The regulator is expected to confirm later this week a 4% increase on the energy price cap for millions of households from October as \u201ctoo many households continue to feel the strain of high energy bills\u201d, the group\u2019s chief executive, Dhara Vyas, said.<\/p>\n
She urged Andy Burnham\u2019s government last week to consider a \u201ctargeted and more permanent\u201d solution to the rise in energy bills \u2013 including a social discount tariff \u2013 rather than rely on \u201cstopgap, ad hoc or emergency measures\u201d.<\/p>\n
The increase will more than wipe out the impact of the new prime minister\u2019s promise to cut VAT from household electricity bills from October, which aimed to give voters \u201csome breathing space\u201d<\/a> by shrinking bills by an average of about \u00a345 a year.<\/p>\n \u201cThe current arrangements fail to provide the help needed and work out more costly,\u201d Vyas said. \u201cA social discount will address the fuel poverty gap and provide the right amount of support to the right households at the right time \u2013 reflecting that needs vary across different customers.\u201d<\/p>\n The forecast energy price cap rise means that over the final three months of 2026 the typical household faces a gas and electricity bill equivalent to \u00a31,729 a year<\/a>, forecasters at Cornwall Insight predict.<\/p>\n The consultancy expects electricity rates to rise from 26.11p a kilowatt hour to 26.57p, and gas charges will rise from 7.33p to 7.90p for households that pay via direct debit. However, the actual bill for a household will depend on how much each consumes.<\/p>\n The average bill under the price cap was calculated assuming lower annual energy use than in previous years, because the high cost of energy has forced many households to use less gas and electricity as debt levels rise. Using the previous methodology, the price cap would be forecast to rise to \u00a31,940.69 from October \u2013 the highest level since the summer of 2023.<\/p>\n
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