Households are bracing for yet another rise in energy bills this winter, with Cornwall Insight warning of a 9% increase in January – roughly £149 added to the average annual bill. It’s an early forecast, and global events could shift the picture, but the outlook is far from reassuring.
Analysts say wholesale prices could fall if tensions in the Middle East ease, but for now the trend is pointing in the wrong direction.
Energy Secretary Miatta Fahnbulleh hinted this morning that ministers are preparing to go further in the upcoming Budget, saying the government is exploring “what more we can do”. With public finances already stretched, the scale of any intervention will be closely watched.
On Wednesday, Fahnbulleh pointed to the familiar culprit: that fossil fuel prices are a “rollercoaster”, this time jolted by Donald Trump’s latest Middle East misadventure.
But the short-term spike is only part of the story. Even when gas prices fall, industry projections suggest bills won’t meaningfully drop.
EDF, one of the UK’s biggest suppliers, published new forecasts this week assuming “some moderation” in wholesale costs. Their conclusion: bills will remain stubbornly high through the end of the decade. The company expects the price cap to sit at £1,721 in late 2026 and rise to £1,786 by 2030.
That figure could be around £90 lower if the government extends VAT relief on electricity and continues shifting older green levies into general taxation. But even with those measures, the numbers cast serious doubt on former energy secretary Ed Miliband’s promise of “£300 off bills by 2030” — a pledge that now looks increasingly unrealistic.
With another price rise looming and long-term projections offering little comfort, the pressure is mounting on ministers to deliver meaningful relief. Whether the Budget will go far enough remains to be seen, but for millions of households, the stakes could not be higher.