MILLIONS of households will see their energy bills rise in the New Year.
Ofgem's price cap will increase from £1,717 a year to £1,738, affecting 26million households on their supplier's standard variable tariff.
However, it's important to note that the price cap is not a limit on the overall amount people will pay for their energy.
Instead, it caps the amount that they pay per kilowatt hour, or unit, for gas and electricity.
The watchdog's calculations assume the average household burns through 11,500kWh of gas and 2,700kWh of electricity each year.
Use more, and you'll be shelling out more than £1,738 come January. Use less, and your wallet might breathe a sigh of relief.
We've crunched the numbers to uncover just how much extra you'll need to fork out when those dreaded bills arrive in January.
We've worked out how much a typical small, medium and large household currently pays via direct debit each month and how much they'll pay when the price cap changes in the New Year.
But don't expect to be charged these exact figures.
These are based on national averages, and it's important to remember that the price cap varies by region.
Your monthly direct debit may also vary depending on if you're in debt or have significant credit with your energy supplier.
A small household made up of one to two people uses around 7,500kWh of gas and 1,800kWh of electricity every year.
These households currently pay roughly £104 a month on their energy bills.
However, the same household will see their bills rise to £105 a month from January 1 - or from £1,247 a year to £1,260 a year.
A medium household is made up of two to three people and uses an average of 11,500kWh of gas and 2,700kWh of electricity every year.
The average monthly bill for these households under the current cap sits at £143 a month.
However, the same household will see their bills rise to £145 a month from January 1 - or from £1,717 a year to £1,738 a year.
That leaves larger households, often made up of four to five individuals, who use roughly 17,000kWh of gas and 4,100kWh of electricity every year.
Right now, the monthly bills for these homes average £200.
However, the same household will see their bills rise to £203 a month from January 1 - or from £2,403 a year to £2,435 a year.
BELOW we reveal how you can calculate your own energy bill.
To calculate how much you pay for your energy bill, you must find out your unit rate for gas and electricity and the standing charge for each fuel type.
The unit rate will usually be shown on your bill in p/kWh.The standing charge is a daily charge that is paid 365 days of the year - irrespective of whether or not you use any gas or electricity.
You will then need to note down your own annual energy usage from a previous bill.
Once you have these details, you can work out your gas and electricity costs separately.
Multiply your usage in kWh by the unit rate cost in p/kWh for the corresponding fuel type - this will give you your usage costs.
You'll then need to multiply each standing charge by 365 and add this figure to the totals for your usage - this will then give you your annual costs.
Divide this figure by 12, and you'll be able to determine how much you should expect to pay each month from April 1.
Despite Ofgem's upcoming January price cap increase, there's still time to save.
There are dozens of fixed energy deals available that outshine suppliers' standard variable tariffs.
It takes just five minutes to switch and start saving.
Fixed deals work to protect customers from bill hikes if Ofgem were to increase the price cap in the future.
Fixed deals are available for various periods, typically ranging from 12 to 24 months.
Of course, taking out a fixed deal carries a slight risk of you paying more than those on the standard variable tariff if Ofgem's energy price cap were to fall within your deal's term.
However, Richard Neudegg, director of regulation at Uswitch.com, said: "The average household could save up to £112 per year against the January price cap by switching to a fixed deal."
Outfox the Market is currently offering the cheapest deal on the open market.
Its 18-Month Fix'd Dual Dec24 v2.0 tariff costs a typical household £1,626 a year.
This means it is £112 cheaper than Ofgem's January price cap.
The same supplier is also offering a 12 month fixed deal that costs £1,630 a year.
This means it is £108 cheaper than Ofgem's January price cap.
Both deals come with no exit fees.
Other firms may offer offer prices which beat those in the table above.
But, these often cost customers more by forcing them to take out an extra service, like boiler cover, which isn't always necessary.
So, make sure you always read the small print.
TO find the best fixed energy deals, start by visiting price comparison websites, which aggregate various offers from different energy suppliers.
The best sites include Uswitch.com and MoneySavingExpert's Cheap Energy Club.
Enter your postcode and current energy usage details to receive a list of available deals tailored to your needs - it'll take you less than five minutes.
You'll then be able to compare the rates, contract lengths, and any additional features or benefits offered by each deal.
Next, visit the websites of individual energy suppliers to check if they have exclusive deals that are not listed on comparison sites.
Sometimes, suppliers offer special promotions or discounts directly to customers.
Compare these offers with those on the comparison websites to ensure you get the best possible rate.
Finally, consider customer service reviews and the overall reputation of the suppliers.
Once you have identified the best deal, follow the instructions to switch your energy provider.
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