UK household energy bills forecast to jump 16% to £1,999 a year from January as Middle East conflict depletes European gas stocks

Consultancy Cornwall Insight has forecast that the Ofgem price cap for a typical dual-fuel household will rise by £276 a year to £1,999 from January 2027, a 16% increase that would mark the biggest quarterly rise in four years. The prediction comes the day before a 4% increase, equivalent to roughly £60 a year, takes effect under the October price cap, taking the typical annual bill to £1,723. That October rise was partially offset by the government's VAT cut on electricity, which knocks approximately £45 off a typical bill. Cornwall Insight attributes the January forecast to disruption of gas supplies caused by the conflict in the Middle East and the resulting low gas storage levels across Europe, with high prices expected "well beyond the winter". The firm's principal consultant Craig Lowrey described a January rise as "all but certain", noting that the price-setting period for the cap is already halfway through. EDF Energy chief executive Simone Rossi warned the UK is "walking into a second significant energy crisis" and called for the VAT cut on electricity to be extended beyond its current April expiry. He also urged ministers to approve the Jackdaw gas field off Aberdeen and the Rosebank oil field off Shetland. Ofgem data shows customers collectively owe more than £5bn in unpaid bills, and the regulator has a proposed debt relief scheme under consideration. Charities including National Energy Action are pressing the government to use the upcoming Budget to provide targeted support for the most vulnerable households.