Josh Jackman Date published: 9th June 2022 7 min read ✔ The average home will pay £896 more over the next 12 months✔ That figure includes £400 of government support✔ 79% of households will be affected22 million households are set to see their energy bills increase by 42% in October.The new energy price cap will be “in the region of £2,800” per year, according to Ofgem chief executive Jonathan Brearley, up from £1,971.This £829 increase isn’t official yet – and won’t be until August at the earliest – but households can’t wait until then to prepare for such a gigantic increase in their bills.Here’s what the latest hike in your energy prices means for you, and how to best deal with it.What’s on this page? 01 How will the price cap rise affect you? 02 Is there any government help available? 03 How much will your gas bill increase by? 04 How much will your electricity bill increase by? 05 Will solar panels be more profitable to buy? 06 What can you do to reduce your bills? How will the price cap rise affect you?From October 2022, your monthly energy bill will be £233, on average.That’s £69 higher than it is now, which is in turn £58 higher than it was before April 2022.Overall, your monthly energy bill for October 2022 will be £127 more than your bill for October 2021.The effects of this devastatingly large hike will be wide-ranging. Is there any government help available?Yes, the government is set to help homes with their soaring energy bills, through the Cost of Living Support package.This package will give all households in England, Scotland, and Wales a grant of £400 to lessen the impact of the energy cap rise.You don’t have to do anything to receive this funding; it’ll simply be taken off your energy bills over the course of six months, starting in October.In addition, the lowest income households will receive £650 in two payments – one in July, and one that’s currently scheduled for the autumn.To qualify, you must be on at least one of the following means-tested benefits:Child Tax CreditIncome SupportIncome-based Jobseekers AllowanceIncome-related Employment and Support AllowancePension CreditUniversal CreditWorking Tax CreditAll pensioners will also be given a one-off grant of £300. If you’ll be 66 or older on 25 September 2022, this should be automatically deducted from your energy bills.And households containing people with disabilities will also get a one-off payment, to the tune of £150.This will be available to anyone who receives at least one of the following benefits:Armed Forces Independence PaymentAttendance AllowanceConstant Attendance AllowanceDisability Living AllowancePersonal Independence PaymentScottish Disability BenefitsWar Pension Mobility SupplementHow will this support affect your bills?This government support will automatically be added to your energy bills from October 2022 to April 2023.Without the support, your energy costs would increase by £415 over this six-month period – but the £400 grant to all households means you’ll only pay £15 more.This will be a relief to millions – but it doesn’t take into the account the previous price cap rise.Is the government’s support enough?The government’s support is insufficient, as it does nothing to address the price cap’s previous rise of 54% in April 2022.In the 12 months from April 2022 to March 2023, the average household will pay £2,386 for its energy.That’s £1,296 more than that same household paid from April 2021 to March 2022.Even the lowest income households will only receive £1,050 in belated payments, meaning their costs will go up by £246 instead – which is still far too much for many homes.The only households whose increased energy costs will be covered by the government’s support are lowest income homes that contain a pensioner.Most homes will only receive the £400 grant, leaving them having to pay £896 more for their energy than they did the previous year.And come April 2023, the support package will end just as the price cap rises again.Thanks to previous price cap rises, 6.5 million households already live in fuel poverty – which is when spending enough to properly heat your home puts you under the poverty line.This package won’t stop hundreds of thousands more homes entering fuel poverty. How much will your gas bill increase by?The average home will pay £116 per month for gas from October.That’s a rise of £34 on every single monthly gas bill.The average price of gas will go up by 3.1p per kWh, to 10.5p per kWh.Your daily standing charge will also go up, from from 27.2p to 38.7p. How much will your electricity bill increase by?The typical household’s monthly electricity bill will be £117.That’s an increase of £35 per month.The average cost of electricity will soar by 12p per kWh, to a new, record-breaking rate of 40.3p per kWh.And the new average daily standing charge will be 64.4p, up from 45.3p.How much more will your boiler cost to run?Between October 2022 and April 2023, gas boiler running costs will rise from £420 to £628 for the average home.In those six months, you’ll pay £208 more to use your boiler.This is because the cost of gas will increase from 7.4p per kWh to 10.5p per kWh.How about heat pumps?Heat pumps use electricity, so their average running costs across this six-month period will also increase, from £560 to £800.So if you own a heat pump, you’ll typically pay £240 more to use it.This reflects the rise in the price of domestic electricity, from 28.3p per kWh to 40.3p per kWh. Will solar panels be more profitable to buy?Yes, solar panels will absolutely be more profitable after the October 2022 price cap rise.With electricity costing 40.3p per kWh, the average UK household with a new set of solar panels will break even in just 6.7 years.Before April 2022, the cost of electricity was such that it would’ve taken 11.3 years to break even.A typical three-bedroom house can now make an overall profit of £13,000 by buying solar panels, as long as they use the Smart Export Guarantee.Between October 2022 and April 2023 alone, they’ll cut their electricity bills by £357. What can you do to reduce your bills?Follow the 60% of UK residents who told our National Home Energy Survey that rising energy bills made them want to switch to green energy.Solar panels are your best option. If you can afford their average £4,800 price tag and you use the Smart Export Guarantee, you’ll cut your electricity bills by 59% every month.You could also quickly make your home more energy efficient – and insulation is a great place to start.Roof and loft insulation can save you £225 per year, cavity wall insulation can cut your costs by £255 per year, and solid wall insulation will reduce your bills by up to £435 per year.If you need cheaper solutions, there are plenty of options.Draught proofing will cut up to £50 per year from your energy bills, while avoiding overfilling your kettle can save you £47 per year.The average home will also save £40 per year by replacing all their light bulbs with LED bulbs.If you’re still struggling to pay your energy bills, contact your supplier and tell them about your situation, as they may be able to reduce or suspend your payments.For more energy-saving tips, read our Top 17 Ways To Reduce Your Energy Bills. Josh Jackman Senior Writer @josh_jackman Josh has written about eco-friendly home improvements and climate change for the past three years. His work has featured on the front page of the Financial Times; he’s been interviewed by BBC Radio; and he was the resident expert in BT’s smart home tech initiative.