Wholesale gas prices hit their highest level since 2022 on Wednesday at 217p per therm, up from 81p a year ago, according to the Telegraph1. The End Fuel Poverty Coalition had reported on 9 September that the UK wholesale price of gas had reached a fresh high last seen in December 2022, with the cost approaching 200p per therm as of 1300 that day2. The Energy and Climate Intelligence Unit said on 12 October that UK gas prices had risen to their highest levels since December 20223.
Keith Anderson, chief executive of Scottish Power, told an industry conference on Wednesday that debts from household gas and electricity bills will hit at least £7bn next year, forcing suppliers to recoup more costs from those who are able to pay1. Unpaid energy debts already add £67 a year to the average bill under rules set by Ofgem, the regulator, and this is poised to hit £100 if debts keep rising1. EDF has warned that energy bills will jump from £1,723 today to more than £2,204 next April1.
"We're heading into a doom loop of asking today's bill-payers to pick up the costs of others without solving any of the issues that caused it."
Ofgem has announced that energy bills will increase for a majority of customers from 1 October 2026 as gas unit rates rise 27% year on year, the highest level since early 2023, while electricity unit rates are being held roughly stable, helped by the Government cutting VAT on electricity2. The End Fuel Poverty Coalition said surging oil and gas prices since the start of the US-Iran conflict on 28 February have added an estimated £5 billion in higher gas and electricity costs, with a handful of firms making £6bn on UK operations in the first six months of 20262. It attributed the gas price rise to Qatar suspending LNG shipments and European storage sites sitting below the seasonal average with the heating season approaching2.
The ECIU's Jess Ralston said the UK remains exposed to wars and instability thousands of miles away because it is still so reliant on gas, particularly for heating homes, and that reports suggest Government support for heat pumps could be cut3. She said more North Sea drilling will not shield people from internationally-set gas prices3.
Why it matters for households
The gas price is the main input into the price cap, so movements in the wholesale gas and electricity markets feed through to domestic bills with a lag. The End Fuel Poverty Coalition said the January price cap is being calculated on prices like these, and that households using heating oil or on some heat networks, who are not covered by the cap, may see increases sooner2. Heating oil prices have exceeded the previous five-year highs set at the start of the US-Israeli attacks on Iran2. For a home's energy independence, the exposure runs through how much gas it uses for heating: the ECIU argues the lasting route to energy security is using less gas through better insulated homes, more heat pumps and clean British power3. The wholesale prices guide sets out how these costs reach bills, and UK domestic energy prices over time puts the current level in context.
What happens next
The next price cap period reflecting these prices will be announced in late November and come into force on 1 January 20272. Energy Secretary Miatta Fahnbulleh said on Wednesday that a decision on whether to give the Jackdaw oil and gas field the green light was "imminent", with an announcement expected as early as next week, while a decision on Rosebank, the largest untapped oil field in UK waters, will take "a bit longer"1. She said she was "100pc confident" the lights will not go out this winter1. The price cap history and announcement dates page lists when each level has been set.