Nearly 15 million households will see their energy bills rise by up to £96, as a result of an increase in the price cap.

Ofgem said the price cap has been set at £1,138 per year for default tariff customers and at £1,156 for pre-payment meter customers and will come into force from 1st April.

The return to pre-pandemic levels is attributed to the change in wholesale energy prices.

During the first lockdown last year, costs fell sharply and the level of the price cap dropped by £84 in October.

Demand for energy has since recovered, pushing wholesale prices back up to more normal levels.

The regulator adjusts the level of the cap up or down twice a year, to reflect the costs of supplying electricity and gas for suppliers.

Jonathan Brearley, Chief Executive of Ofgem, said:  “Energy bill increases are never welcome, especially as many households are struggling with the impact of the pandemic. We have carefully scrutinised these changes to ensure that customers only pay a fair price for their energy.

“The price cap offers a safety net against poor pricing practices, saving customers up to £100 a year, but if they want to avoid the increase in April they should shop around for a cheaper deal.

“As the UK still faces challenges around Covid-19, during this exceptional time I expect suppliers to set their prices competitively, treat all customers fairly and ensure that any household in financial distress is given access to the support they need.

But what does the energy industry think about the new price cap?