Household energy bills in Britain could rise by more than \u00a3400 in the new year as higher wholesale fuel prices put renewed pressure on consumers. According to The Independent, forecasts from EDF and Bloomberg Economics suggest annual costs could climb above \u00a32,150, taking bills to levels not seen since June 2023.<\/p>\n\n\n\n
The warnings come before Ofgem\u2019s October price cap takes effect, raising the average household bill to \u00a31,723. That represents a \u00a360, or 4%, increase from the current rate. Pressure on fuel markets has intensified amid conflict in the Middle East, while the effective closure of the Strait of Hormuz<\/strong> has contributed to rising prices.<\/p>\n\n\n\n An independent forecast from EDF <\/strong>estimates that the average energy bill could increase by 30% to \u00a32,165 in the new year. According to The Independent, that would represent a \u00a3442 increase from the October price-cap level, equivalent to about \u00a336 more each month for an average household.<\/p>\n\n\n\n Bloomberg Economics issued a separate forecast during the same week, estimating a 25% increase to \u00a32,150 for the January-to-March period. Under either forecast, household energy costs would reach their highest level since June 2023.<\/p>\n\n\n\n An earlier estimate from energy consultancy Cornwall Insight <\/strong>was lower. In August, the firm predicted that January\u2019s price cap would be set at \u00a31,872, an increase of \u00a3149. Wholesale prices have risen since that forecast was published, and Cornwall Insight is expected to issue a new estimate later in September.<\/p>\n\n\n\n The price cap limits how much energy suppliers can charge per unit to customers on standard variable tariffs, which cover most households. The annual figure published alongside the cap reflects consumption by an average home rather than setting a maximum amount that any household can pay.<\/p>\n\n\n\n Ofgem has also changed the methodology used to calculate the cap as average<\/strong> consumption levels <\/strong>have shifted. Using the regulator\u2019s methodology from before October 2023, EDF\u2019s \u00a32,165 forecast would be equivalent to \u00a32,425 a year. That figure is close to the \u00a32,500 level at which the government intervened following the energy <\/a>price shock associated with Russia\u2019s invasion of Ukraine in 2022.<\/p>\n\n\n\nForecasts Point to a Sharp Rise in Household Costs<\/strong><\/h2>\n\n\n\n