Energy giant EDF has warned that the average household energy bill could rise by 26%
Millions of households are being warned to brace for another jump in energy bills as winter approaches, with fresh forecasts suggesting the typical annual cost could surge by hundreds of pounds at the start of 2026. Energy firm EDF says the average bill could climb by 26% to £2,165 when the next Ofgem price cap takes effect in January – an increase of about £442. That would land after another rise expected this autumn.
The current cap is also due to move higher in October, with Ofgem’s limit forecast to rise 4% to £1,723. EDF’s latest warning is linked to a sharp spike in wholesale gas prices, fuelled by concerns that the escalating conflict in the Middle East could disrupt supplies, including liquefied natural gas shipments through the Strait of Hormuz.
On Monday, the wholesale gas price topped 208p a therm, its highest since December 2022 and roughly double late-June levels.
With bills potentially rising again, charities and campaign groups say many families are already entering the colder months with debts left over from the last energy crisis. The End Fuel Poverty Coalition – which includes the National Pensioners Convention, Energy Action Scotland, Fuel Poverty Action and Uplift – has sent the Chancellor a seven-point “winter rescue plan”.
A key demand is that energy arrears built up during the crisis should be written off for households on means-tested benefits. The coalition is also calling for the £150 Warm Home Discount to be increased and widened to cover vulnerable households who are outside the benefits system, arguing the rebate has shrunk relative to bills. It says the discount is currently worth around 8% of a typical bill, down from about 14% when it was introduced.
The coalition has also warned that gas unit rates could reach around 12p per kWh from January 1, 2027. It says that would be about double the 5.93p per kWh rate under the cap at the start of 2026, though the 12p figure is based on its own modelling using the upper end of current price-cap forecasts.
Ministers are understood to be looking at options to soften the impact for households if prices keep climbing. One idea being discussed is an Energy Price Protection Payment for people already receiving the Warm Home Discount or other benefits, although no amount has been set.
Another is raising the Warm Home Discount itself. A wider, universal bailout similar to the £400 energy discount introduced in 2022 has also reportedly been considered, but repeating that kind of scheme would be expensive – the previous six-month package cost £44billion.
The warning on household bills comes as drivers are also facing higher costs at the pumps. The RAC said filling a family car had increased by almost £5 since the start of September, with petrol at 170.54p a litre and diesel at 192.86p.
The End Fuel Poverty Coalition also claims energy companies have made around £125billion in profits from UK operations since 2020, though the industry disputes those figures. Jan Shortt, general secretary of the National Pensioners Convention, said older people, disabled people and those on low incomes faced falling into debt as prices rise.
Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “With gas prices again on a dangerous upward trajectory, emergency financial support may also be needed to keep people safe this winter.” He also urged steps to cut reliance on gas and heating oil, including accelerating the Warm Homes Plan.
Other proposals include replacing Cold Weather Payments in England, Wales and Northern Ireland with an Extreme Weather Payment triggered by forecast cold snaps, and extending the temporary cut in VAT on electricity beyond March 31, 2027.
A Government spokesperson said: “The chancellor is fully focused on giving families and businesses breathing space and helping ease cost pressures.”
There remains uncertainty over where the cap will land, with other industry forecasts putting the January average bill at around £2,086 (a 21% rise), compared with EDF’s £2,165 estimate. EDF has previously suggested bills could stay elevated for years, forecasting average dual-fuel costs in 2030 to be 13% higher than the level seen in the final quarter of 2025.
