Got questions or concerns about the latest price cap change? You’re in the right place. Whether you’re wondering what it is or how it might affect you, you’ll find answers to the most common questions here.

For tips and suggestions on the best ways to be more energy efficient at home, check out our Energy Saving Advice page.

What is the energy price cap?

The energy price cap makes sure you pay a fair price for your energy. It limits how much suppliers can charge you per unit of energy, and is based on the costs that Ofgem (the UK’s energy regulator) calculates we need to spend to get energy to your home. 

All energy suppliers must apply the price cap, and you’re price protected if you use a prepayment meter, or are on a flexible - sometimes called a standard variable - tariff.

Ofgem reviews the price cap every six months to make sure that the price you pay your energy supplier reflects the actual cost of providing you with that energy. 

If these costs go up, the price cap goes up with it. If those costs decrease, the price cap will come down too.

Does the price cap increase affect me?

It depends what type of tariff you’re on: 

I’m on a flexible tariff

If you’re on a flexible tariff, the price cap increase will affect you. You’ll have received an email or letter from us, letting you know your new rates.

In a typical household, credit customers are paying £693 (excl VAT) more on their annual energy bill, which works out at £60 per month. Prepayment customers are seeing an increase of £708 (excl VAT) per year, or £59 per month.*

We know these increases are causing difficulties for many households. If you’re struggling with your energy bills, there are ways we can help. We’ve also created a £5 million support fund to help customers experiencing energy debt and financial hardship. 

I’m on a fixed tariff

Fixed tariffs protect you from energy-market price rises for the length of your contract.

If you’re on a fixed energy tariff, the unit charge for your energy won’t change. That means April’s price cap increase won’t immediately affect you.

When your fixed tariff is ending, we’ll get in touch to discuss your options.

Why can’t energy suppliers charge less?

mceclip0.png

Source: https://www.ofgem.gov.uk/publications/infographic-bills-prices-and-profits

This pie chart shows the breakdown of a Dual Fuel energy bill. As you can see, wholesale energy costs account for a large part of your bill (around 35%), while there are also things like network costs (pipes, wires, etc), operating costs, taxes, and VAT to consider. 

This means that when the markets change significantly, our prices need to adjust as well. We work hard to keep our costs low so we can absorb as many of these costs as possible. But, unfortunately, the latest increase in wholesale prices has been so significant, we’ve had to increase our rates in line with the new price cap.

How long will the price cap last?

Ofgem reviews the price cap twice a year, in February and August, with the changes taking effect on 1 April and 1 October. This is to make sure prices reflect the changes in underlying costs to get energy to you. They also work closely with us and the energy market more generally to make sure you’re getting a fair deal at all times.

How can I be sure Shell Energy is charging me correctly based on the cap?

Ofgem decides what the price cap is going to be, and revises it twice a year. Ofgem always explains why it makes changes, and publishes the new levels we must follow. We’ll then give you the details for your specific tariff.

How much you pay will depend on:

  • how you pay (Direct Debit or otherwise)
  • where you live
  • what type of meter you have. 

 

The price cap won’t limit your total bill. This will vary, depending on how much energy you use.

What should I do if I have a problem paying each month?

We understand that this is a worrying time for many and we want to do all we can to make sure you feel supported.

If you’re struggling to pay, check out our support hub, which details what help and support is available to you.

Is there any other support available to me?

If you’re struggling to pay you can also find support here: 

StepChange Debt Charity (or call 0800 138 1111)

Money Advice Service (or call 0300 500 5000)

National Debtline (or call 0808 223 4188) 

Citizens Advice (or call 0808 223 1133)

Will my energy be cut off if I can’t pay?

Credit customers

Don’t worry, you’ll still receive energy as normal. You can find out what help is available to you in our support hub.

Prepay customers

If you’re struggling to top up and have a low meter balance, we’ll give you £10 emergency credit. This will need to be paid back when you top up next. 

If you have a smart meter, you can top up on our app. If you have a traditional meter, you can top up at your nearest Paypoint. If you don’t top up, your supply may be cut off. 

If you can’t afford to top up, please call our team on 0330 094 5802 and we’ll find the best way to support you.

Can I change my tariff?

We’re not currently offering fixed tariffs. Once wholesale prices stabilise and we’re able to offer our customers fixed tariffs once again, we’ll let you know. 

Are other suppliers changing their prices?

The price cap impacts how much every energy supplier in the UK can charge per unit of energy. Suppliers will typically change their prices to reflect the latest Ofgem price cap review.

How is the price cap calculated?

Ofgem calculates price caps based on the latest estimates of the costs for each supplier to supply their customers with electricity and gas. These include the costs of wholesale energy, networks, environmental and social programmes, and tax. 

Ofgem also makes an allowance for suppliers’ costs to ensure we can continue to operate. Ofgem always explains why it makes changes to the caps, and shows you current price-cap levels.

I’m on a Smart Export Guarantee (SEG) tariff – is the rate I receive changing? 

If you’re on a Smart Export Guarantee (SEG) tariff, your tariff is currently set at 3.5 pence per kW. There are no plans to change this tariff rate.

I’m on a Feed in Tariff (FIT) scheme – is the rate I receive changing? 

If your solar panels are registered on a government Feed in Tariff scheme (FIT), your generation and export tariff rates increased on Friday 1 April. These rates will be adjusted with the Retail Price Index (RPI), which is set at 7.5%.

What is a standing charge, and why has it increased?

A standing charge is a fixed daily charge for supplying your home with energy. It includes the fees we have to pay the companies who own the wires and pipes that transport your energy. The recent changes to the energy price cap have affected the standing charge, as well as the unit price of your energy. Here’s why: 

The companies who own the pipes and wires that transport energy to your home normally split their fees across the standing charge and unit rate. They tell suppliers like us how much we need to pay them each day (a cost we include in your standing charge) and also the fee per usage (which we add to the unit rate). When Ofgem, the UK’s energy regulator, reviewed the price cap, many of those costs were moved from the unit rate onto the daily standing charge. 

On top of this, the amount we pay the network companies is increasing. This is driven by two factors: the cost of maintaining the network has gone up, and there’s an extra amount payable to recoup the costs associated with the collapse of 29 energy suppliers this past year. This is why your standing charge is going up, while increased wholesale prices have seen the unit rate rise, too. 

It’s worth noting that there are different network companies across the country serving different regions. Each company sets its own charges, which means there isn’t one, universal set of rates – prices vary between regions. Ofgem has published an average, but this will be different to the rate you pay, which will depend on where you live. 

Why is the standing charge for some customers higher than the averages Ofgem has published?

How much you pay for your electricity standing charge will depend on where you live. This is because the cost of maintaining the network varies between regions. The average price – as shown on Ofgem's website– is 45p, but this means that some regions pay less (in London it’s 32p), while others pay more (in the South West, it’s 51p) to reflect the differing network costs of serving those areas.   

For gas, there’s just one standing charge.

Why we’ve decided to temporarily remove fixed tariffs

Right now, wholesale costs are so high that offering you a fixed tariff would mean setting a price that's higher than the price cap. As this doesn’t represent a good deal for our customers, we’ve temporarily removed fixed tariffs from our website. 

When wholesale prices stabilise, we’ll go back to offering fixed tariffs online with 100% renewable electricity as standard.

What happens if I need extra support? 

We understand that rising energy prices will affect our customers, and want to do all we can to help. If you’re struggling to pay your bill, get in touch with our team. You can also:

To find out more about how the price cap works, visit Ofgem’s website.

* The average annual bill figure is for illustrative purposes only and is based on Ofgem’s national average consumption rates of 2,900kWh of electricity and 12,000 kWh of gas. Your actual costs may differ based on the amount of energy consumed. https://www.ofgem.gov.uk/publications/price-cap-increase-ps693-april 

† Lines are open 8am to 6.30pm Monday to Friday or 9am to 4pm Saturday.