Changes to energy bills announced in the recent Budget take effect in spring 2026, the End Fuel Poverty Coalition has said, but average household energy bills will remain higher than they were in winter 2020/20211. The campaign group published its assessment as cold weather affected the country, describing the change as a marginal tweak to the energy price cap that leaves bills almost £700 above pre-crisis levels1.
In the detailed price cap documents, Ofgem confirmed that the Earnings Before Interest and Tax (EBIT) allowance built into the cap will rise by £1.51 per household from January to March 2026, a 4% increase1. The Coalition states this could hand suppliers millions of pounds of extra profit while the average household energy bill rises by 0.2%1. The group also cites analysis showing 27 energy companies have made more than £125bn in UK profits since 2020, part of more than half a trillion pounds in global profits across the sector, with more than four-fifths coming from companies with extensive involvement in the gas industry1.
The Coalition says official data shows the UK will no longer be able to meet national heating demand using domestically extracted gas from 20271. It links this to a North Sea basin in long-term decline, and to the policy costs and levies that sit on household bills.
It found 29% of adults say they are unable to keep their home at the recommended minimum temperature of 18°C, and 14% consider themselves to live in cold, damp homes, with higher rates among low-income households, families with children and people with long-term health conditions1. Among those in cold, damp homes, 18% reported high levels of carbon monoxide in the past 12 months1.
"It really is a case of every little doesn't help as cold weather grips the country and the price cap nudges upward."
"Households are facing their fifth winter of unaffordable energy bills. For millions of people, this cold isn't an inconvenience, it's a real risk to health and safety as they struggle to keep homes warm."
Why it matters for households
The spring 2026 changes alter what households pay, but the Coalition's position is that they do not restore bills to their pre-crisis level1. The EBIT allowance is a return built into the cap for suppliers, so its rise of £1.51 per household between January and March 2026 flows through the standing charges and unit rates that make up a bill, rather than being a separate charge1. For a household, the practical effect is that the floor under a bill moves up slightly even as the headline average moves by 0.2%1.
The Coalition's figures on cold homes and carbon monoxide point to the health side of energy independence at home: a dwelling that cannot be kept warm, or whose gas appliances go unserviced, carries risks beyond cost1. The claim that domestic gas will not meet national heating demand from 2027 is about where the heat comes from, not what it costs1.
What happens next
The Budget bill changes take effect in spring 20261. The EBIT allowance rise runs from January to March 20261. The Coalition calls for the Warm Homes Plan to be funded, energy pricing to be fixed and a fair social tariff introduced1. No further dates for those measures are given in the source.
Sources1 cited
- Price cap tweaks fail households as cold snap hits the country - End Fuel Poverty Coalition, endfuelpoverty.org.uk