Households in the United Kingdom could face a sharp increase in heating costs in January, with energy bills forecast to rise 27% and gas rates expected to reach a record high.
Here's what to know
An EDF analysis seen by The Times forecasts that Ofgem's annual price cap will reach £2,192 ($2,936) in January, up from £1,723 ($2,306), according to The Independent.
That would mean an additional £469 ($628) for a household using the amount of energy assumed in the cap calculation.
A household's energy use determines its bill; the cap does not set a maximum total charge. Instead, it restricts suppliers' gas and electricity charges based on their costs. Ofgem, the independent energy regulator, reviews those limits every quarter.
Europe's gas supplies are a concern as fighting involving Iran pushes prices higher, driving the forecast increase.
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More background
Wholesale gas prices reached €97, or about £81 ($108), per megawatt-hour as falling temperatures increased heating demand across Europe.
That marked a four-year high, with attacks between the United States and Iran adding pressure to an already strained market.
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EDF's analysis forecasts that household gas rates will reach 11.13 pence per kilowatt-hour in January. That would surpass the previous record of 10.33 pence set at the start of 2023, when Russia's invasion of Ukraine drove an earlier energy-price shock.
April is expected to bring a further increase in both electricity and gas prices.
The country's exposure to these price increases extends beyond household heating. According to EDF, oil and gas still account for 70% of the United Kingdom's total energy consumption.
What's being done?
The New Economics Foundation, an influential think tank, has urged the government to allocate £6 billion for broader energy assistance to shield all households against the expected increases.
Chancellor John Healey is reportedly considering a £1 billion ($1.3 billion) allocation to increase funding for the Warm Home discount, which is available to people receiving certain means-tested benefits.
The country could put the homegrown electricity being built to use and better withstand future shocks by speeding up electrification, an EDF spokesperson told The Times.
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EDF's spokesperson emphasized that households need relief.
"Rising wholesale gas prices are once again pushing up energy bills and the increases forecast this winter are worsening. Additional support for those least able to pay, alongside tackling the growing problem of energy debt, is essential for this winter.
"Longer term, with 70% of the UK's total energy consumption still coming from oil and gas, we need to electrify the economy more quickly to improve resilience to future shocks and ensure we utilise the homegrown electricity being built," the spokesperson told The Times.
Where can I learn more?
Rising gas prices are squeezing U.K. household budgets and making electric heating worth a closer look. These U.K. stories cover winter energy supplies, heat pump costs and grants, and who qualifies for fuel payments.
• Gas prices are set to jump 85%, strengthening the case for heat pumps.
• The U.K. faces a harsher winter as oil tops $100 and Europe's gas buffer thins.
• In Britain, $12,000 heat pump grants face cuts to fund defense as gas prices surge.
• In the U.K., four groups won't receive the £200-£300 ($268-$402) Winter Fuel Payment in 2026.
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