UK energy secretary says looking at ‘what more we can do’ as typical annual bill rises to £1,723 from October – business live
UK households face a fourth energy price cap rise this year, with the typical annual bill increasing by £60 to £1,723 from October, Ofgem announced, making it the highest level in three years. The increase stems from wholesale gas price volatility linked to the ongoing Iran conflict, prompting renewed pressure on the government to shield struggling households, with unions and economists warning of financial strain and continued inflationary pressure ahead.
The cap will rise by 4% (technically 3.6%, rounded up by Ofgem) from October, following a 13% jump in July, and comes after Brent crude climbed from $72.80 to around $90 a barrel since the war began six months ago. Energy secretary Miatta Fahnbulleh pointed to the removal of VAT from electricity bills and an earlier £150 reduction as measures already taken, while TUC general secretary Paul Nowak said many people are "skipping meals" and cutting back on essentials. Economists warned that low European gas storage levels could push bills even higher by January, keeping inflation elevated into 2027.
- Typical UK energy bill rises £60 to £1,723 from October.
- Iran war-driven wholesale gas prices are the main cause.
- Unions warn households are struggling; more bill rises may follow in January.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Advocates for stronger government intervention argue that with typical bills now at a three-year high and driven by volatility beyond any household's control, ministers have both the moral duty and fiscal tools to shield people from a crisis they did not cause. They point to unions' testimony that families are skipping meals as evidence that existing measures, such as the VAT removal and the earlier £150 reduction, are insufficient, and argue that targeted support, further subsidies, or structural reform of energy pricing are justified to prevent lasting hardship and economic damage. They see this as consistent with a compassionate, active state stepping in when markets fail ordinary consumers.
The case against
Those cautious about further intervention argue that the price cap already reflects a considered balance between protecting consumers and maintaining a functioning energy market, and that the rise is driven by external wholesale gas volatility linked to geopolitical conflict, not domestic policy failure. They contend that repeated ad hoc government support risks distorting market signals, straining public finances already under pressure, and setting a precedent of shielding consumers from global price movements that cannot be sustained indefinitely. On this view, the sensible course is to maintain existing targeted support, encourage energy efficiency and diversification of supply, and avoid interventions that could exacerbate inflation or deter investment in the energy sector.