Winter energy prices expected to rise to three-year high
Millions of households will be affected by an increase in the energy price cap by regulator Ofgem.
Household energy bills are forecast to soar to a three-year peak this winter, under a price cap to be revealed by industry regulator Ofgem, according to wire material. The cap, set to reflect the surge in gas wholesale costs, will impact bills from October to the end of December. Analysts anticipate a 4% increase in the cap compared to the present level, affecting those with variable tariffs in England, Scotland, and Wales.
Energy firms have reported a surge in energy debt and have called for additional assistance for those struggling to pay. The UK government announces a reduction in VAT for electricity bills. The price cap for approximately 33 million households is projected to rise, driven by fluctuations in international gas prices. The average gas price has surged 61% over the past three months compared to late 2025, as reported by suppliers' trade body Energy UK.
Around 40% of billpayers have fixed tariffs, which will not see a rise in the price they pay until the expiration of their contract. Cornwall Insight, a consultancy, projects that a household using the average amount of gas and electricity, paid through direct debit, will pay £1,729 yearly from October, a rise from £1,663 between July and September and marking the highest level in three years.
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