Annual energy bills could climb back above £2,000 next year – in a blow to millions of families facing another costly winter.
The price cap set by regulator Ofgem from January 1 will take the typical gas and electricity bill to £2,083 a year, asset manager Investec predicted.
That is an 8 per cent rise on current tariff levels, adding further strain to budgets at a time of year when households are most likely to turn on the heating.
A fall in bills next month is likely to be temporary, adding to the headache facing ministers and the Bank of England over inflation.
The price cap set by regulator Ofgem from January 1 will take the typical gas and electricity bill to £2,083 a year, asset manager Investec predicted (Stock)
It comes as Chancellor Jeremy Hunt warned inflation was on the rise again. Ofgem caps the tariffs suppliers can charge households.
The limit, set every quarter, goes up when suppliers have to pay more for gas and electricity on global markets. Bills soared after Russia’s invasion of Ukraine last year sent global gas prices surging.
Bills went from about £1,000 to £2,500. Billions of pounds of taxpayer subsidies were spent to stop them from going higher. They started to come down in July as wholesale gas prices eased.
The October cap of £1,923 marks the first time it will be below £2,000 since last summer. January’s cap will be set later this year.
Investec analyst Martin Young said: ‘Our latest price-cap estimates point to an 8 per cent jump, exacerbating cost of living pain.’
Chancellor Jeremy Hunt (pictured) warned that Britain’s inflation was on the rise again
Mr Young warned estimates stayed ‘highly volatile’ given possible market movements between now and when the cap is set.
He predicts bills will be ‘back above the £2,000 level for what is the highest consumption quarter of the year’, adding: ‘The cost of energy/living crisis is not dissipating.’
Inflation rose to 11.1 per cent last autumn, and dropped to 6.8 per cent in July. But internal Treasury analysis suggests inflation climbed to more than 7 per cent in August.
Elsewhere, RAC figures show average petrol prices went up by 7 pence per litre over last month – one of the biggest monthly fuel rises over the past two decades.
Ministers will overhaul planning rules that prevent onshore wind farms being built.
Government sources said they would bring into force immediate changes to stop just one person being able to block projects – as has been the case under rules since 2015. It would end the de facto ban on new wind turbine sites, as long as there is sufficient local support.
The pledge is designed to prevent a Commons defeat today, seeing off an amendment to the Energy Bill tabled by Tory Alok Sharma.
