As energy bills become more expensive from 1 January, respected forecasters have said they are likely to rise further in spring instead of fall, as first anticipated.
The energy price cap rises from January, bringing the cost of a typical annual bill to £1,738 – £21 a year more than from October to December.
Bills had already become more expensive from October, up 10% a year – or £12 per month.
But now the forecast dip in April will not materialise, according to energy consultants Cornwall Insight.
Instead, the firm said the cost is April is expected to rise to £1,785 a year for a typical consumer, nearly a 3% increase on January’s cap, about an extra £4 a month on the average bill.
Compared to the three months from July, it will cost £217 a year more, according to the forecast.
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Billpayers have seen energy costs rise every three months since July. Energy regulator Ofgem revises its price cap four times a year, setting out the maximum a provider can charge per unit of gas and electricity.
It’s assessed based on how much providers themselves are being charged to supply power and is intended to protect consumers and utilities.
Why are bills going up?
Continued volatility in international energy markets is behind the cost increases.
EU gas storage levels and uncertainty over the gas transit deal between Russia and Ukraine have contributed to “a level of volatility we haven’t seen for months”, according to Cornwall Insight’s principal consultant Dr Craig Lowrey.
The unknown impact of a Trump presidency on liquified natural gas (LNG) flows means the firm said its forecasts will “display a high degree of variability”.
These events resulted in higher wholesale prices which impact how much households are billed in the UK.
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These forecasts “could very well increase or decrease several times before the April cap is set”, Dr Lowrey said.
The official energy price cap announcement for the three months from April will come on 25 February.
Also influencing bills are possible changes to the standing charge, the fixed daily amount to receive gas and electricity.
Ofgem is consulting on introducing an option to include zero-standing charge options alongside existing tariffs, offering more consumer choice.
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As of 31 December, Cornwall Insight anticipates a July price cap fall before an October rise.
