Energy bills will increase more than expected for millions of British households this autumn, as Ofgem raises the government's price cap by 2% from October. The typical annual dual-fuel bill will rise by just over £35 to £1,755, despite a 2% fall in wholesale energy prices over the last three months.
About £15 of the increase will fund an expansion of the warm home discount scheme, providing an extra 2.7 million households with a £150 reduction. Another £17 will go towards balancing the energy system as Britain relies more on renewables, including payments to shut wind farms or fire up gas plants when needed.
For 9 million households on variable tariffs, the impact will be immediate. The electricity unit rate will rise from 25.73p to 26.35p per kWh, while gas falls slightly from 6.33p to 6.29p. Standing charges also increase, with electricity rising from 51.37p to 53.68p per day and gas from 29.82p to 34.03p.
Labour blamed the previous government's renewable energy policies and criticised Reform leader Nigel Farage's plans to move away from green energy. A spokesperson said: 'Energy bills soared under the Conservatives because they tied our country to the fossil fuel rollercoaster.'
The typical household will now pay about £600 more per year than before Russia's invasion of Ukraine in 2022. Citizens Advice's Gillian Cooper said the charity was 'bracing for more calls as people struggle to top up their meters' and called for long-term support and energy upgrades.
