Energy costs likely to rise under Ofgem's new price cap
Published On Feb 24, 2025, 7:00 PM
The UK energy regulator, Ofgem, is set to announce a third successive price cap increase for households, with projections indicating a 5% rise in gas and electricity costs starting in April. This increase is attributed to rising wholesale prices caused by colder weather and lower gas storage levels in Europe. As a result, the average annual energy bill for a typical household could reach £1,823. This situation places further financial strain on consumers already grappling with increased costs in other areas like water and council taxes. Calls for government intervention and enhanced energy efficiency measures are growing as household debts to suppliers reach £3.8 billion.
Stock Forecasts
XLU
Negative
The rise in energy prices is likely to impact utilities and energy supply companies adversely as consumers may seek cheaper alternatives or reduce usage. Additionally, increased household debt can dampen discretionary spending, affecting the broader economy.
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