London Daily

Focus on the big picture.
Wednesday, Jul 02, 2025

Energy bills set to soar but millions may get £200 help

Energy bills set to soar but millions may get £200 help

A record rise in energy bills is set to be announced on Thursday, but the government may step in to reduce bills by £200 for many households.

The energy regulator will detail how much bills can rise from the beginning of April, with forecasts they could reach £2,000 for many homes.

Energy firms are likely to be given loans to help them cut customers' bills, the BBC has been told.

Ministers may also extend targeted help for those in need.

But there are doubts over whether the measures will be ready by the time higher prices start on 1 April.

Energy bosses have told the BBC that they have been kept largely in the dark about the government's plans.

While some have described the plan to lend money to energy companies, to allow them to reduce bills as credible, they say they are worried that the details of the plan have not been thought through.

Energy firms are struggling under the weight of surging wholesale gas prices, and passing on some of that rise to consumers, driving up the cost of living.

Rising energy bills have helped push inflation up to a 30-year high, leaving the government under pressure to intervene.

The Treasury's "rebate and clawback" scheme, first revealed in The Times, would involve providing around £5-6bn in loans to energy firms to enable them to lower bills.

But the scheme has raised concerns among providers because the money would still have to be paid back eventually.

Energy bosses told the BBC they expect the plan would include recouping the money from households over three to five years as wholesale costs fall.

However, the bosses said wholesale prices are not expected to fall significantly any time soon.

Ofgem was meant to reveal April's price cap - which sets how much providers can charge for gas and electricity - next Monday, but it has brought the announcement forward.

The government's announcement, which could come as early as Thursday, may also include an extension of the warm homes discount and changes in other benefits.


One of the UK's biggest providers, EDF, said in a statement it would welcome government action, but gave no details of any plan nor the timing.

Philippe Commaret, the firm's managing director for customers, said: "Ballooning wholesale gas prices are driving energy bills up and customers need government to act now, especially to support those most in need.

"We look forward to hearing from government urgently on how it will help struggling households beyond the support energy companies already provide. Delaying action adds to the stress and anxiety households face."

It is feared Ofgem's announcement will take the average annual domestic energy bill from 1 April to about £2,000 for 22 million households, up from about £1,300.

That has intensified calls in recent weeks for the government to step in to help struggling households.

Citizens Advice revealed they have already seen a record number of people turning to them for advice on energy debts.

The cost of living is forecast to rise further this year, along with interest rates.

Across the economy individuals and companies are reporting price pressures. On Wednesday, a survey found that shoppers are seeing the sharpest rise in prices for a decade.

The cost of broadband and mobile phones, raw materials, transport and fuel, and food and drink are among a wide range of products and services now on the rise.

There are also planned tax rises in April, with Prime Minister Boris Johnson under intense pressure to scrap an increase in National Insurance. But he, and Chancellor Rishi Sunak, said at the weekend the NI rise would go ahead.

Newsletter

Related Articles

0:00
0:00
Close
Poland Implements Border Checks Amid Growing Migration Tensions
Political Dispute Escalates Between Trump and Musk
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
US Senate Votes to Remove AI Regulation Moratorium from Domestic Policy Bill
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
Jury Deliberations in Diddy Trial Yield Partial Verdict in Serious Criminal Charges
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
King Charles Plans Significant Role for Prince Harry in Coronation
Two Chinese Nationals Arrested for Espionage Activities Against U.S. Navy
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
Trump Administration Considers Withdrawal of Funding for Hospitals Providing Gender Treatment to Minors
Texas Enacts Law Allowing Gold and Silver Transactions
China Unveils Miniature Insect-Like Surveillance Drone
OpenAI Secures Multimillion-Dollar AI Contracts with Pentagon, India, and Grab
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Elon Musk Critiques Senate Budget Proposal Over Job Losses and Strategic Risks
Los Angeles Riots ended with Federal Investigations into Funding
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Education Secretary Announces Overhaul of Complaints System Amid Rising Parental Grievances
Massive Anti-Government Protests Erupt in Belgrade
Trump Ends Trade Talks with Canada Over Digital Services Tax
UK Government Softens Welfare Reform Plans Amid Labour Party Rebellion
Labour Faces Rebellion Over Disability Benefit Reforms Ahead of Key Vote
Jeff Bezos and Lauren Sánchez Host Lavish Wedding in Venice Amid Protests
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
North Korea to Open New Beach Resort to Boost Tourism Economy
UK Labour Party Faces Internal Tensions Over Welfare Reforms
Andrew Cuomo Hints at Potential November Comeback Amid Democratic Primary Results
Curtis Sliwa Champions His Vision for New York City Amid Rising Crime Concerns
Federal Reserve Proposes Changes to Capital Rule Affecting Major Banks
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Trump Escalates Criticism of Media Over Iran Strike Coverage
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
Big Four Accounting Firms Fined in Exam Cheating Scandal
NATO Members Agree to 5% Defense Spending Target by 2035
Australia's Star Casino Secures $195 Million Rescue Package Amid Challenges
UK to Enhance Nuclear Capabilities with Acquisition of F-35A Fighter Jets
Russian Shadow Payments via Cryptocurrency Reach $9 Billion
Explosions Rock Doha as Iranian Missiles Target Qatar
“You Have 12 Hours to Flee”: Israeli Threat Campaign Targets Surviving Iranian Officials
×