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Ofgem announced its latest change to the energy price cap this morning and it's bad news for Brits. The cap will rise by 2% and the estimated bill for the average household will be £1,755. The figures announced today will be introduced in October and last until December. Ofgem, which sets the limit on what energy companies can charge customers, has said the average annual energy bill will rise by more than expected in October.

This marks an increase of £35 from the current cap, which is the typical sum most households pay for gas and electricity for those who pay via direct debit. Ofgem has said that the £1,755 per year average is £625 (26.3%) lower than when the "energy crisis" was at its peak in 2023. Households have been advised to calculate their average spend by adding £2 to every £100 they spend on energy per year.

"News of higher bills will not be welcomed by households, especially as winter approaches," said Dr Craig Lowrey, principal consultant at Cornwall Insight. "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."

The price cap was introduced by the government in January 2019 and sets a limit of what suppliers can charge energy customers in England, Scotland and Wales.

A Department for Energy Security and Net Zero spokeswoman said: "The only way to bring down energy bills for good is with the Government's clean energy superpower mission, which will get the UK off the rollercoaster of fossil fuel prices and on to clean, homegrown power that we control.

"We are taking urgent action to support families this winter - in addition to expanding the £150 Warm Home Discount to 2.7 million more households, we are strengthening customer protections, including by giving people quicker and easier access to automatic compensation when their suppliers let them down."

Ofgem said that the increase in energy prices is due to "increases to parts of the costs of transporting energy in Great Britain (England, Scotland, and Wales)."

Simon Francis, coordinator of the End Fuel Poverty Coalition, said: "Fuel poverty is very much still with us and these figures highlight how vital schemes like the Warm Home Discount are to help those struggling each year. But we are now approaching the fifth winter of the energy bills crisis and the time for tinkering with the price cap is over.

"The average household is still paying 67% more for their energy than in winter 2020/21. 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.

"We also need to realise that the North Sea is now in terminal decline and unable to meet the UK's long-term heating needs. This means we must urgently plan to cut our dependence on gas and bring down the cost of electricity."