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The UK energy regulator, Ofgem, is expected to announce a significant increase in the electricity price cap, with estimates suggesting that the average household bill could rise to £1,850, reflecting a £209 increase from the previous quarter. This forecast is based on current wholesale energy prices, which Ofgem tracks during its observation period.
Energy consultancy Cornwall Insight has provided insights into these projections, indicating that the price surge is largely driven by external factors, including geopolitical tensions affecting energy supplies, particularly following the closure of the Strait of Hormuz. Ofgem is likely to emphasize that without the contributions from renewable energy sources like wind and solar, the price hike could have been even more substantial, highlighting a shift in the energy mix where gas now sets the wholesale price of electricity only 60% of the time, down from 90% in the past.
Critics argue that Ofgem should provide clearer, multi-year forecasts and detailed breakdowns of electricity pricing to better inform consumers about future costs. This call for transparency comes as households brace for prolonged high energy bills, which are expected to remain elevated for the foreseeable future.
As the energy landscape evolves, the need for straightforward communication from regulators becomes increasingly vital to help consumers navigate their financial commitments in a challenging economic environment.
Source: www.theguardian.com – https://www.theguardian.com/business/nils-pratley-on-finance/2026/may/26/ofgem-should-tell-it-straight-electricity-prices-are-set-to-stay-high-for-years