UK electricity bills expected to rise 25% by January

According to the forecast of Bloomberg Economics, the bills of British households for electricity in January may grow by about 25% against the background of the situation in the Middle East.

As reported by Bloomberg, regulator Ofgem will use energy futures prices fixed from mid-August to mid-November to lower marginal prices on domestic electricity bills in January, a period that so far includes an increase in wholesale gas prices. That means the price is expected to rise by £427 ($575) to around £2,150 a year for a typical household. The quarterly adjustment means that on October 1, accounts should already rise by 4%.

Rising energy prices threaten to trigger inflation in the economy as a whole, with the economic damage to ordinary Britons far outweighing the benefits of Burnham's first moves to lower the cost of living since he took power in July. On his second day as prime minister, he abolished the value-added tax on household energy bills from 1 October, which the government said would save families an average of £45 a year.

Since February, the price of gas in the UK for a month ahead has increased by 150 percent.

The latest rise in energy prices could lead to higher inflation – above 4% in 2027, double the Bank of England’s target. Analysts said such a forecast could force the central bank to raise interest rates later this year, Bloomberg Economics said.

The Government is now considering further measures, including extending a £150 heating discount to people who are currently ineligible for it, potentially including some disabled people, pensioners and others on the benefit list.