Households face 13% energy bill surge as Ofgem raises price cap

Household energy prices are rising by 13% from Wednesday.

Ofgem’s latest price cap will increase by 13% – around £18 a month – taking the annual bill for a typical household using gas and electricity to £1,862.

The increase follows a spike in wholesale energy costs linked to tensions in the Middle East.

Prices rocketed after Iran responded to US and Israel attacks by blocking the Strait of Hormuz shipping route, through which a fifth of the world’s oil and gas is carried.

Ofgem will announce the next price quarterly cap level for October to December on or by August 26.

It comes as debt to energy suppliers has reached a new record high of £4.79bn – a 5% increase on the last quarter, Ofgem has said.

Citizens Advice Scotland (CAS) is marking the new increase by calling for bold action by the regulator to end fuel poverty.

Molly Shevlin, energy spokesperson for Citizens Advice Scotland, said: “Even though we’ve been living through a heatwave, rising energy prices this summer will be a devastating blow for many people across Scotland.

“The pressure is already overwhelming, with people turning to local CAB offices at crisis point because they cannot top up their prepayment meters without emergency support.

“We urge Ofgem and the UK Government to introduce bold measures to tackle fuel poverty, including a debt write-off scheme for those trapped in energy debt and a social tariff for households on the lowest incomes.”

Age Scotland chief executive Katherine Crawford said the Warm Home Discount should be increased to at least £200 and expanded to cover more low-income households.

She said: “Our research shows that half of Scottish pensioners are living in fuel poverty. That needs to change.

“While many may be using less energy during the summer, this latest and significant rise could be a sign of things to come in the autumn and winter as it gets colder and darker.

“Over the last five years energy costs have more than doubled but the financial support for those older households on low and modest incomes just hasn’t kept up. Better access to energy efficiency measures, home insulation and enhanced financial support for the coldest parts of Scotland should be seriously considered.”

First Minister John Swinney highlighted a number of Scottish Government measures in place to help households struggling with energy costs, including support through the Scottish Welfare Fund and the Scottish Emergency Heating Oil Scheme.

He said: “I know the prospect of further energy bill increases will be causing anxiety for many people who are already struggling with the cost of living.

“Scotland is an energy-rich country and nobody should be struggling to pay their bills. If the UK government was serious about devolving more power away from Westminster they would finally put control of Scotland’s energy resources in Scotland’s hands.”

Tim Jarvis, Ofgem CEO, said: “We understand many will be concerned about rising prices. While energy use typically falls over the summer months, there are still practical steps households can take to manage costs, including exploring fixed tariffs or changing their payment method. Smart meter customers can also take advantage of half price or cheap electricity at the weekends.

“While our energy supplies remain secure, the best way to limit this exposure is by investing in our energy network. That’s why we’re unlocking the funding needed for the biggest transformation of our lifetime to deliver a system that is secure, resilient, and works for consumers across Great Britain.”