Millions of households across Britain are set to face their highest energy bills in three years this winter, after regulator Ofgem announced a 4% increase in its energy price cap from October.
Ofgem said on Wednesday that the cap on gas and electricity prices would rise for the October 1 to December 31 period, citing higher wholesale gas prices linked to the continuing conflict in the Middle East.
“This increase reflects higher wholesale gas prices as a result of the ongoing conflict in the Middle East, with volatile global gas markets remaining the dominant driver of price changes,” Ofgem said.
The increase means a typical household paying by standard tariff will face an annualised bill of around £1,723 ($2,348), up from £1,663 during the July-September period.
Around 22 million households on default tariffs are covered by the price cap, which limits the maximum unit rates and standing charges suppliers can impose. Ofgem reviews the cap every three months to reflect changes in the cost of supplying energy.
Energy Secretary Miatta Fahnbulleh acknowledged the pressure rising bills were placing on households amid broader cost-of-living concerns.
“We know people are under huge amounts of pressure due to the cost of living, and I know that people are really worried about their energy bills,” she told the BBC.
The opposition criticised the government over the increase, with Shadow Energy Secretary Claire Coutinho calling for cheaper energy to be prioritised.
“Labour promised to cut energy bills by £300, but they have gone up by nearly £400 instead,” Coutinho said.