Business

Winter energy price rises anticipated as experts warn market remains highly volatile

Expected hike in Britain’s energy price cap signals potential increases for Northern Ireland households

The average household energy bill is set to rise by 9% in October when the latest change to the price cap takes effect, according to experts
Britain's energy price cap does not apply in Northern Ireland, but the industry here is still vulnerable to the same volatility affecting global energy markets. (Andrew Matthews/PA)

An anticipated hike in Britain’s energy cap could see prices similarly rise in Northern Ireland this winter.

The price cap does not apply in the north, which is part of the separate all-island energy market.

But the industry here is still vulnerable to the same volatility affecting global energy markets.

Energy consultancy Cornwall Insight said it expects the typical household’s energy bill in Britain to rise 9% to £1,714 a year, up from £1,568 currently, on October 1.

The group said there is also likely to be a further “modest” increase in January 2025, with more rises possible early in the new year due to “recent tensions in the Russia-Ukraine war”.

Craig Lowrey, principal consultant at Cornwall Insight, said: “This is not the news households want to hear when moving into the colder months.

“Following two consecutive falls in the cap, I’m sure many hoped we were on a steady path back to pre-crisis prices.

“However, the lingering impact of the energy crisis has left us with a market that’s still highly volatile and quick to react to any bad news on the supply front.

“Despite this, while we don’t expect a return to the extreme prices of recent years, it’s unlikely that bills will return to what was once considered normal.

“Without significant intervention, this may well be the new normal.”



Energy regulator Ofgem will announce the energy price cap for October to December on Friday August 23.

The cap was introduced by the UK Government in January 2019 and sets a maximum price that energy suppliers can charge consumers in England, Scotland and Wales for each kilowatt hour (kWh) of energy they use.

The price cap does not limit a household’s total bills because people still pay for each unit of gas and electricity they use - the figures provided are calculated for an average-use household and if more energy than average is used, a household will pay above the cap.

Ofgem is currently considering the future of price protection, including the suitability of the price cap and a potential permanent ban on so-called acquisition tariffs - cheaper prices for new customers to lure them away from their existing supplier.