Average energy bill to rise to £1,738 from January as squeeze continues

The average annual energy bill in England, Scotland and Wales will increase to £1,738 from January, heaping further pressure on household finances, as the price cap rises by 1.2%.

- Jack Simpson

The energy regulator Ofgem said its quarterly cap would go up by £21 a year, or about £1.75 a month, for a typical household's gas and electricity use. The increase for the January-March cap comes on top of a 10% rise for the October-December period, when it was £1,717 a year.

As temperatures drop during the winter, consumers also face a squeeze from rising mortgage costs and higher inflation as well as threatened price rises by retailers as a result of changes made in last month's budget.

The price cap is set every three months by Ofgem, the regulator that covers Great Britain, and is the maximum suppliers can charge their 26 million household customers for each unit of gas and electricity.

The annual figure represents the average use in a British home. However, consumers may pay more depending on their usage.

Ofgem said the new cap would be £190 cheaper compared with January 2024 and 57% less than in January 2023, during the energy crisis. But bills will remain far higher than the £1,216 cap before Russia's invasion of Ukraine in February 2022, which sent gas prices soaring and threatened to push energy bills above £4,000.