Ofgem announced a 6.4% increase of the energy price cap for the period covering April to June.
This is almost double what was predicted and piles the pressure on millions already facing huge energy bills.
The regulator blamed a recent spike in wholesale prices accounting for around 78% of the total increase. A small increase in policy costs and associated inflationary pressures make up a further 22% said Ofgem.
The price cap will rise by £111 for an average household per year, or around £9.25 a month, over the three-month period of the price cap.
For an average household paying by Direct Debit for dual fuel this equates to £1,849 per year.
This is 9.4% (£159) higher than this time last year (£1,690) but £531 (22%) lower than at the height of the energy crisis at the start of 2023, when the Energy Price Guarantee was in place.
Since the last price cap announcement in November 2024, four million customers have moved to a fixed tariff and Ofgem said 11 million people are on a fixed deal and won’t be affected by the change.
This is the largest movement of customers coming off the price cap and on to a fixed deal since the energy crisis it added.
Ofgem boss Jonathan Brearley said: “We know that no price rise is ever welcome and that the cost of energy remains a huge challenge for many households.
“But our reliance on international gas markets leads to volatile wholesale prices and continues to drive up bills, which is why it’s more important than ever that we’re driving forward investment in a cleaner, homegrown system.
“Energy debts that began during the energy crisis have reached record levels and without intervention will continue to grow. This puts families under huge stress and increases costs for all customers. We’re developing plans that could give households with unmanageable debt the clean slate they need to move forward.
If anyone is worried about paying their bills, I would urge them to reach out to their supplier to make sure they’re getting all the help they can. Where possible, switching or fixing tariffs now could also help to bring costs down and provide certainty over coming payments.”
Copyright © 2025 Energy Live News LtdELN