B1 Intermediate · 291 words · 2 min read

Energy Price Cap to Rise 4% in October, Taking Typical Bill to £1,723

Ofgem says higher wholesale gas prices will add £60 a year to a typical household bill just as colder weather arrives.

Household energy bills in Britain will reach a three-year high after the regulator Ofgem announced that the price cap will increase by 4% on 1 October. A household using a typical amount of gas and electricity will pay £60 more a year, or £5 a month, taking the annual figure to £1,723 if the level was sustained for a year.

The increase has been driven by higher wholesale gas prices, which make up just over a third of a dual-fuel bill. According to Energy UK, the trade body for suppliers, the average price of gas has been 61% higher over the past three months than in late 2025. Gas bills are rising by 8%, although electricity bills are falling slightly because of the government's cut to VAT on electricity.

Neil Kenward, Ofgem's director general for markets, said a gap was opening up between gas and electricity prices for the second price cap in a row. He added: "Savings are available by choosing a fixed tariff, which are available at £100 or more below the October price cap." Around 35% of households, or 11 million homes, are already on fixed tariffs, while 22 million households in England, Wales and Scotland are affected by the cap.

The government said its VAT cut would save households £45, and that the warm homes discount would take £150 off bills for six million households this winter. Opposition parties said this was not enough. Shadow energy secretary Claire Coutinho said the government had to "put cheap energy first".

Suppliers say energy debt has risen sharply, to an estimated £6bn, and have called for more support for customers who are struggling. Analysts at Cornwall Insight have forecast that prices may rise a further 9% in the new year.

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