Ofgem Raises UK Energy Price Cap 4% to Three-Year High
· World · The Independent, BBC News
UK regulator Ofgem raised its energy price cap by 4%, lifting the typical household bill to £1,723 a year if sustained for 12 months — a £60 annual, or £5 monthly, increase that marks the highest level since July 2023. Ofgem tied the rise to higher wholesale gas prices driven by the ongoing Middle East conflict, with volatile global markets remaining the dominant driver. Ofgem's director general for markets, Neil Kenward, said the government's planned removal of VAT from electricity bills from October will limit the increase, and that fixed tariffs are available at £100 or more below the October cap. Prepayment customers also pay the lowest cap rates, saving an average of about £45 versus direct debit.
Why it matters
The 4% cap rise adds pressure on UK households entering the winter heating season, though VAT removal and cheaper fixed tariffs could offset some of the increase. The decision highlights how the Middle East conflict feeds directly into British household energy costs through wholesale gas markets.
Read the original report — The Independent
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