Most households paying £750 a year more for energy bills than before cost of living crisis

Average households are set to pay around £750 more per year for energy bills compared to winter of 2020/2021, research has revealed.

It’s a 75% increase and means that, by the end of June 2025, households will have had to find an extra £3,033 to pay their energy bills during the cost of living crisis.

Ofgem is due to announce its next energy price cap on Tuesday (25 February), with energy bills forecast to increase in April by at least 5% from current levels.

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According to forecasts from Cornwall Insight, a typical household is expected to pay around £1,822.99 a year for their energy bills between April and June 2025.

By comparison, in October to March 2020, the energy price cap was £1,042.

Simon Francis, coordinator of the End Fuel Poverty Coalition, said the burden of high energy bills had gone on long enough. “As long as our energy bills remain tied to the cost of gas, households continue to be at the mercy of global markets and a fossil fuel industry which is making billions of pounds in profit every year,” he said.

“But alongside the transition away from reliance on gas, it’s crucial to provide support for vulnerable households struggling with energy costs now and to invest in improving energy efficiency of homes.”

Ofgem caps the cost of each unit of gas and electricity, but the total bill is not capped, meaning that some households will pay more for their energy bills.

Campaigners have warned this most impacts larger families and people with health conditions who use medical equipment or need to keep their homes warm – people who are already at greater risk of facing poverty.

“Households in the UK will be in despair that energy prices are on the rise again as they are out of pocket by thousands and have forked out for excessive bills for the last four years,” explained Caroline Simpson, Warm This Winter campaign manager.

“These constant hikes show the UK is still too reliant on foreign energy imports and the answer is not more North Sea drilling. Our gas fields are now virtually exhausted and any resources extracted as a result of new developments would be sold on the open market, making vast profits for foreign owned energy giants and doing nothing to bring down bills for ordinary people.”

Simpson said the UK should rapidly increase supply of homegrown, cheap and clean renewable energy “which is abundantly available and the quickest form of energy production to get up and running”. 

Francis urged chancellor Rachel Reeves to announce a fully-funded £13.2bn Warm Homes Plan in the Comprehensive Spending Review, and he also encouraged the government to introduce swifter support for people next winter.

“Until then, the only advice for households is to make the most of existing energy efficiency schemes and if customers do shop around for a lower energy bill, they must use their own energy usage on price comparison sites,” Francis said. “Bills can vary greatly due to different rates for every unit of energy used and the daily standing charges so it pays to be aware of how these might affect the total bill.”

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