The energy price cap in Great Britain has risen to the equivalent of £1,862 per year from Wednesday, pushing millions of households into fuel poverty as the typical bill surges by £220 annually. According to the End Fuel Poverty Coalition, the number of homes forced to spend more than 10% of their income on energy bills will increase to 13.5 million, up from almost 11.3 million in April. This marks the steepest summer rise in energy charges in four years.
Impact on Households
Almost 5.5 million homes now face energy bills consuming about 20% of their income, a sharp increase from 4.3 million in April, based on research by the University of York. Simon Francis, coordinator of the End Fuel Poverty Coalition, stated: “These figures show the reality behind the headline price cap figure: a growing number of households are spending an unsustainable share of their income just to heat their homes in winter and keep them cool in summer.” He added that rising costs over summer will wipe out any chance for households to reduce energy debts or build reserves before winter.
New Cap Rates
Under the new cap, electricity rates rise from 24.67p to 26.11p per kilowatt hour, and gas charges increase from 5.74p to 7.33p, for households paying via direct debit. This equates to an annual dual fuel bill of £1,862 for a typical household under the previous methodology. Using new calculations assuming lower consumption, the regulator Ofgem estimates the average household will spend £1,663 per year from July.
Future Forecasts
Energy analysts at Cornwall Insight predict bills will remain high as cooler months begin, with greater impact as gas use increases. From October, the average bill could be £1,654 under the new assumptions, a 0.5% reduction from July. The surge has reignited calls for government action on energy affordability.
Political Reactions
Unite union has planned protests calling for an immediate cut to energy costs and renationalisation of energy companies. Sharon Graham, Unite’s general secretary, said: “The increase in the energy cap is another kick in the teeth for workers and families who were already struggling with ever rising bills and the cost of living crisis. The UK has among the highest energy bills in Europe, they should be going down not up.”
Labour MP Andy Burnham, widely expected to become prime minister, used a public address to advocate for local leaders to have greater control of essential services, including energy, to curb living costs. Simon Francis commented: “If it is to be Andy Burnham as the next PM with his vision of a rewired Britain, then new ministers must also rewire how energy bills are set. Plans to devolve control of energy will count for nothing unless they are accompanied by a permanent social tariff, an end to energy debt, reduction of electricity costs and a credible plan to break the link between gas and electricity prices.”
Martin McCluskey, minister for energy consumers, said: “We know families are deeply concerned about rising energy bills because of a war we did not choose, and we are determined to fight their corner to tackle energy affordability.” The government has removed some policy costs from home energy bills and expanded the warm home discount scheme to benefit 6 million households. McCluskey confirmed the government will continue to monitor the situation before winter and plan for all contingencies while pursuing clean power to lower bills permanently.
