Energy bills to RISE for millions of households as new price cap to hit £1,755

MILLIONS of households are to see their energy bills hiked by 2% to £1,755 this autumn.

The new price cap, confirmed by regulator Ofgem today, comes in from October 1.

Smartphone displaying energy usage graph and British currency.

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Regulator Ofgem announced its latest energy price cap todayCredit: EPA

It will see bills rise by £35.14 per year for households using a typical amount of energy – up from the current rate of £1,720, which came into effect in July.

Only those on standard variable tariffs, which is around 35million households, will be affected by the price cap change.

Those on fixed tariffs, however, will not see their bills change from October.

The energy price cap was introduced by the government in January 2019, and sets a maximum price that energy suppliers can charge households in England, Scotland and Wales for each kilowatt hour (kWh) of energy they use.

Experts at Cornwall Insight had predicted the energy price cap would increase by 1% to £1,737 this autumn.

It marked a turnaround from its previous forecast in July that bills would drop by 1% from the current £1,720 in October, due to easing Middle East tensions.

The company said its updated forecast reflected changes Ofgem is set to introduce this autumn and winter.

This includes the expansion of the Warm Home Discount scheme, which aims to help struggling households with their energy costs.

Over six million households are now set to benefit from the scheme – an increase of over 2.5million.

Martin Lewis reveals MILLIONS more households could get £150 energy bill discount – check if you’re eligible

The expansion of the scheme, which was announced by the government in June, is expected to add around £15 to a typical energy bill while also providing £150 in support to 2.7million people.

The price cap is announced every three months, and experts have said they are expecting the price to fall slightly again in January.

However, this will depend on geopolitical movement, weather patterns, and changes to policy changes introduced by the government.

They also said that households could not expect their bills to fall sharply in the near future.

Cornwall Insight principal consultant Dr Craig Lowrey said: “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.”

It comes after campaigners warned that 12.1million households are now struggling with the cost of their energy bills, and urged Ofgem to stop “tinkering with the price cap”.

Two fifths of households are currently finding it difficult to pay their energy bill and are spending more than 10% of their income on gas and electricity, according to recent research by the University of York.

Of this group, almost five million spend more than 20% of their income on energy, which means they are in fuel poverty.

Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “We are now approaching the fifth winter of the energy bills crisis and the time for tinkering with the price cap is over.

“Ofgem is right to launch a comprehensive review of how energy system costs are allocated, but simply shifting budgets between standing charges and unit rates will not solve the problem.”

He added that a typical household is still paying 67% more for their energy than just five years ago.

Help with energy bills

If you are struggling with your energy bills, there are several ways you can get support.

For example, the Winter Fuel Allowance offers £300 to pensioners to help cover the cost of their heating during colder months.

Around 75% of pensioners are expected to receive the support this year, after Labour’s U-turned on the tighter eligibility criteria it announced last winter.

Struggling families can get access to money for their energy bills through the Household Support Fund (HSF).

Each council in England has been allocated a share of the £742million fund and can distribute it to residents in need.

Exactly how much you can get and how the money will be paid depends on your council and situation.

The scheme has been extended multiple times with the latest round running between April 2025 and March 2026.

Meanwhile, thousands of households will receive the Warm Home Discount, which is worth £150.

The discount is means tested and is given to households on a low-income or claiming certain benefits, such as Universal Credit.

If you are falling behind on your energy bill then may also be able to get help from your energy supplier.

British Gas has announced a £140million support package to help customers facing financial hardship.

This includes free energy grants, tailored support for households and small business customers and funding for advice centres and charities.

It has also launched You Pay: We Pay, which gives households the opportunity to have their payments matched by British Gas for a period of six months.

Elsewhere, Octopus Energy’s £30million Octo Assist fund is designed to help customers keep on top of their energy bills.

It includes free electric blankets, Winter Fuel Payments and standing charge waivers.

How do I calculate my energy bill?

BELOW we reveal how you can calculate your own energy bill.

To calculate how much you pay for your energy bill, you must find out your unit rate for gas and electricity and the standing charge for each fuel type.

The unit rate will usually be shown on your bill in p/kWh.The standing charge is a daily charge that is paid 365 days of the year – irrespective of whether or not you use any gas or electricity.

You will then need to note down your own annual energy usage from a previous bill.

Once you have these details, you can work out your gas and electricity costs separately.

Multiply your usage in kWh by the unit rate cost in p/kWh for the corresponding fuel type – this will give you your usage costs.

You’ll then need to multiply each standing charge by 365 and add this figure to the totals for your usage – this will then give you your annual costs.

Divide this figure by 12, and you’ll be able to determine how much you should expect to pay each month from April 1.

Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.

Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories

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