According to Cornwall Insight, a consultancy, energy prices are projected to rise as the UK approaches the colder winter months.
Ofgem’s price cap is anticipated to increase by 9% from £1,568 to £1,714 in October, representing the average annual cost for a British household.
Cornwall Insight attributed this rise to recent volatility in the global energy market. Gas prices have climbed in recent months, partly due to the ongoing conflict between Ukraine and Russia.
The October price cap will set energy unit rates for the year’s final quarter, following a period of the lowest costs in two years from July to September.
Cornwall Insight noted that a rise in prices ahead of winter was anticipated but cautioned that further volatility could arise due to the ongoing conflict between Russia and Ukraine.
Principal consultant Craig Lowrey remarked, “While we don’t expect a return to the extreme prices of recent years, it’s unlikely that bills will revert to previous levels considered normal.”
He added, “Without significant intervention, this may become the new norm,” pointing out that Ofgem’s cap was lower before the war, at £1,277 in October 2021.
Ofgem is scheduled to officially announce the October cap price this Friday.
