From October 1, millions of households in the UK will face an increase in energy bills as the price cap rises by 2% to £1,755 per year. This change, confirmed by the energy regulator Ofgem, translates to an additional £35.14 annually for those using a typical amount of energy. The new cap affects approximately 35 million households on standard variable tariffs, while those on fixed tariffs will not see any changes.

The energy price cap, which was introduced in January 2019, sets a maximum price that energy suppliers can charge for each kilowatt hour (kWh) of energy consumed. Experts from Cornwall Insight had initially predicted a decrease in bills, but recent forecasts indicate a rise due to various factors, including the expansion of the Warm Home Discount scheme. This scheme aims to assist struggling households and is expected to add around £15 to typical energy bills while providing £150 in support to an additional 2.7 million people.

Dr Craig Lowrey, a principal consultant at Cornwall Insight, stated, "News of higher bills will not be welcomed by households, especially as winter approaches. While the added costs behind this forecasted rise are aimed at supporting those most in need, it does mean typical bills will increase despite relatively lower wholesale costs."

The price cap is reviewed every three months, and while experts anticipate a slight decrease in January, this is contingent on geopolitical developments, weather patterns, and government policy changes. The current situation has raised concerns, with campaigners highlighting that 12.1 million households are struggling to manage their energy costs. Recent research from the University of York indicates that two-fifths of households are finding it difficult to pay their energy bills, with many spending over 10% of their income on gas and electricity.

Simon Francis, coordinator of the End Fuel Poverty Coalition, remarked, "We are now approaching the fifth winter of the energy bills crisis and the time for tinkering with the price cap is over. Ofgem is right to launch a comprehensive review of how energy system costs are allocated, but simply shifting budgets between standing charges and unit rates will not solve the problem."

For those facing difficulties, various support options are available. The Winter Fuel Allowance offers £300 to pensioners, with around 75% expected to receive this support this year. Additionally, the Household Support Fund provides financial assistance to struggling families, with councils distributing a share of a £742 million fund. Energy suppliers like British Gas and Octopus Energy have also introduced support packages to assist customers in financial hardship.

As households prepare for the upcoming winter, the rise in energy bills adds to the financial strain many are already experiencing, highlighting the ongoing challenges within the energy market.