Million of consumers will see a rise in energy bills after Ofgem said it would increase the level of two price caps.

Energy bills will rise by £117 for 11 million households on default or standard variable tariffs and by £106 for four million prepayment customers.

That takes the total to £1,254 a year for dual fuel standard variable customers with typical usage and £1,242 annually for prepayment meter customers.

Energy price caps limit the price a supplier can charge per kWh of electricity and gas.

Ofgem blames wholesale costs, which have increased by 17%, for the rise in the price cap levels, which will come into effect from 1st April 2019.

It will scrap the £76 per year savings for default tariff customers that came into force at the start of a new year.

However, the regulator’s analysis suggests these customers could be paying around £75 to £100 a year more on average for their energy had the default tariff cap not been introduced even after today’s increase.

Dermot Nolan, Chief Executive of Ofgem said: “Under the caps, households on default tariffs are protected and will always pay a fair price for their energy, even though the levels will increase from 1st April.

“We can assure these customers that they remain protected from being overcharged for their energy and that these increases are only due to actual rises in energy costs, rather than excess charges from supplier profiteering.”

The government reiterated Ofgem’s findings that suggest standard variable customers will still be £75 to £100 better off.

The cap is designed to ensure energy companies offer good value to their customers and continue to thrive as an efficient business. We were clear when we introduced the cap that prices can go up but also down.