"A dip in bills this January might come as a relief for households, but we shouldn't mistake this as the start of a trend toward cheaper energy. The reduction we are forecasting is being driven by relatively small shifts in the wholesale market. At the same time, new charges like those to support nuclear development are starting to appear on bills, and that's a sign of things to come."
"Any fall in January would represent a pause rather than a permanent drop. By spring, costs are expected to rise again as network charges and policy costs increase. It's a reminder that while wholesale prices may be softening, the costs of running and upgrading Britain's energy system are moving in the opposite direction. Ultimately, adjusting bills, whether through lower standing charge tariffs or redistributing costs, won't deliver meaningful savings. The only route to genuinely lower energy costs is a move toward secure, sustainable energy."
Ofgem's energy price cap will increase by 2% from April 2026, raising a typical household bill from £1,720 to £1,755 annually, an extra £100. Cornwall Insight forecasts a temporary dip to £1,725 in January 2026 before costs rise again. Small shifts in wholesale markets are driving the short-term reduction, while new charges to support nuclear development, rising network charges and growing policy costs will push bills higher by spring. Genuine, lasting reductions require investment in secure, sustainable energy and targeted social tariffs to protect households, since the price cap alone cannot resolve the underlying issues. Uswitch called the predicted rise a bitter pill for households.
Read at London Business News | Londonlovesbusiness.com
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