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We’ll find out the new energy price cap a little later this morning – and it doesn’t look like it’s going to be good news.
Ofgem sets the price cap each quarter, meaning the figures announced today will be introduced in October and last until December.
Energy consultant and major forecaster Cornwall Insight predicts energy bills will rise by £17 to £1,737 a year for a typical dual fuel household – a 1% increase from today’s rate of £1,720.
Here’s a breakdown of the changes it is anticipating…
Why is the cap likely to rise?
Cornwall Insight says its forecast reflects changes it assumes Ofgem will make in October to cover the expansion of the warm home discount, which was announced by the government in June.
The scheme, which gives financial help to vulnerable households, will add around £15 to a typical bill while providing £150 of support to 2.7 million additional people, according to the prediction.
Read more about the scheme here…
Wholesale gas and energy prices have also been volatile, largely due to global conflicts and Donald Trump’s US trade policy, but have been on a general decline recently.
Dr Craig Lowrey, principal consultant at Cornwall Insight, says: “News of higher bills will not be welcomed by households, especially as winter approaches.
“While the added costs behind this forecasted rise are aimed at supporting those most in need, it does mean typical bills will increase despite relatively lower wholesale costs. It’s a reminder that the price cap reflects more than just the market price of energy.
“This immediate challenge underscores a broader uncertainty facing millions of households, with current forecasts suggesting a sharp drop in bills is unlikely in the near term.”
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