Millions of households across England, Scotland, and Wales are facing another rise in energy costs as the latest price cap increase takes effect, prompting urgent calls for more targeted support for those struggling with their bills. On Wednesday, October 1, 2025, Ofgem’s new price cap came into force, raising the average annual energy bill for a typical household by 2%, from £1,720 to £1,755. While the increase may appear modest—amounting to about £35 more per year—the cumulative effect is significant for many families already grappling with high living costs and mounting energy debt.
According to Cornwall Insight, this uptick in the price cap is expected to remain in place through the end of December, with a potential small drop of £30 forecast for the start of 2026. However, the respite may be short-lived. The respected industry forecaster warns that further government-imposed policy costs, including levies to support new nuclear power stations and expanded green energy initiatives, could add up to £100 more per year to bills from April 2026. If these predictions hold, the cap could climb to £1,855 in the spring, underscoring the volatility and uncertainty facing UK households.
Wholesale gas prices, which have been the main driver of rising bills since the pandemic and Russia’s invasion of Ukraine in February 2022, remain 75% above pre-invasion levels. Still, recent months have seen some stabilization, thanks to weaker global demand and increased supply flows. According to Sky News, these factors have helped limit the contribution of wholesale prices to this autumn’s increase, but the risk of global shocks—and their impact on bills—remains ever-present.
Government officials are keenly aware of these challenges. Martin McCluskey, the minister for energy consumers, emphasized the government’s commitment to reducing reliance on volatile fossil fuel markets. “Wholesale gas costs remain 75% above their levels before Russia invaded Ukraine,” he noted. “The more renewables on the system, the cheaper the wholesale price of electricity, which is why the only answer for Britain is this government’s mission to get us off the rollercoaster of fossil fuel prices and onto clean, homegrown power we control.”
To that end, the government is investing in wind, new nuclear—including modular reactors—and other renewables. But this transition comes with its own costs. Charges to fund the green energy shift and support vulnerable households are increasingly being passed on to bill-payers. The expansion of the Warm Home Discount, for example, is being funded by a rise for all billpayers, but it now provides £150 off winter bills for more than six million families—helping one in five households, according to the BBC. The government has also pledged to announce soon “the biggest home upgrade programme in British history,” aiming to improve up to five million homes to make them cheaper and cleaner to run.
Despite these efforts, campaigners and industry voices argue that more must be done to protect those most at risk. Recent figures from Ofgem revealed a record £4.4 billion in household energy debt during the second quarter of 2025, up by £750 million from the same period in 2024. Over one million households now have no arrangement in place to repay what they owe—a record high. Ned Hammond, deputy director at Energy UK, called on the government to “make swift progress to improve targeting and design an enduring support scheme that effectively addresses fuel poverty.” He pointed to research suggesting that spending £1.5 billion a year could “close the fuel poverty gap completely” and save affected households an average of £400 annually.
Ofgem is considering the introduction of a Debt Relief Support Scheme, which would allow suppliers to write off unpayable debts or match customer payments to help manage what is owed. This scheme would likely require funding either from general taxation or by spreading the cost across all customers’ bills. The regulator also aims to ensure a consistent, accessible service for households seeking help from charities and debt support agencies, so that energy debts remain manageable and do not spiral further out of control.
Energy suppliers are also stepping up their support. British Gas, for instance, reopened its Energy Support Fund on October 1, offering grants of up to £2,000 to vulnerable households with energy debt between £50 and £2,000 on pre-payment meters or £250 and £2,000 on credit accounts. To qualify, customers must have received financial advice in the past six months or used an online budgeting tool as part of their application. The company has committed £140 million to help customers since 2021 and last winter issued more than £4.2 million in grants, as reported by Express.co.uk. Additionally, British Gas’s Individuals and Families Fund provides up to £1,700 in support for energy debt, available to customers of any supplier.
Chris O’Shea, chief executive of Centrica, which owns British Gas, said: “As winter approaches, we know that rising household bills are a real worry for many people across the UK. We want our customers to know that we’re here to support them. Tackling energy debt and fuel poverty is a priority for us, and we’re making sure help is available when it’s needed most.”
For those on standard variable tariffs, the advice is clear: now is the time to shop around. Will Owen, energy expert at Uswitch.com, told Sky News, “If you’re on a standard variable tariff, you can beat these expected rises and save on bills by switching to a well-priced fixed deal now. There are currently 26 fixed deals priced below the October price cap, with savings of around £234 for the average household.”
Consumer advocates and charities are also urging households to take action. More than seven million households on standard tariffs were advised to submit meter readings before October 1 to avoid being charged higher rates for energy used before the new cap took effect, according to NationalWorld. Emily Seymour, energy editor at Which?, recommended looking for fixed deals not longer than 12 months and without significant exit fees. She also noted, “If you’re on a variable tariff, make sure to submit a meter reading to ensure you pay the cheaper rates for any energy used before the new price cap takes effect.”
The StepChange debt charity reported a 32% rise in average energy arrears among its clients seeking advice over the past two years. Simon Trevethick, head of communications at StepChange, warned, “Not only will people find they are having to switch on their heating now as the weather turns colder, but bills are also set to go up this month, which is another blow to household finances. Energy arrears are the most common type of debt across household bills that we see at StepChange, and people have had little respite from steep costs over the past three years.”
Support for pensioners is also in focus. After initially slashing the winter fuel payment, the government reversed course, making nine million pensioners in England and Wales with annual incomes of £35,000 or less eligible for the payment, expected in early October.
While the government, regulators, and energy companies have all announced new measures and support schemes, the reality for many households is a winter of tough choices and financial uncertainty. With energy debt at record highs and bills set to rise further in the spring, the need for enduring, targeted support has never been clearer.
For now, as the colder months settle in, millions of Britons are left weighing their options, hoping that the promised help arrives in time to keep the lights—and the heat—on.
