Millions of British households are set to see their energy bills increase by around £75 in 2026, according to the latest analysis from energy consultancy Cornwall Insight.
Price Cap Forecast: A Temporary Dip Before a Steep Climb
The firm's final forecast, released after the observation window closed on 17 November 2025, provides a clear picture of the year ahead. It predicts that the energy price cap for a typical dual-fuel household will first dip to £1,733 per year in January 2026.
This represents a slight decrease of £22, or 1%, from the current cap of £1,755. However, this relief is expected to be short-lived.
The subsequent price cap for April 2026 is projected to be approximately £75 higher than the January figure. This update affects customers of all major UK suppliers, including British Gas, EDF, EON, Ovo, and Octopus.
The Shifting Drivers of Your Energy Bill
According to Cornwall Insight, this upcoming increase is not being driven by the volatile global wholesale energy markets, which have historically been the main factor. Instead, the primary cause is a rise in the fixed costs associated with maintaining the UK's energy infrastructure.
The consultancy stated: "This is largely due to rising charges associated with the operation and maintenance of the country’s energy networks, specifically electricity transmission and gas distribution charges."
This signals a fundamental shift in the structure of energy bills. Wholesale energy prices are forecast to drop to less than 40% of the total price cap and are expected to remain below that level for the rest of the decade. The growing portion of the bill is now made up of these non-energy costs.
Expert Insight: The Long-Term Cost of a Green Transition
Dr Craig Lowrey, Principal Consultant at Cornwall Insight, provided critical context. He noted that while January's small dip might seem positive, bills remain significantly higher than pre-crisis levels and are set to climb again in the spring.
"The government pledged to lower bills on the promise that investment in renewables would reduce our reliance on global energy markets and stabilise bills," Dr Lowrey said. "But what we’re seeing now is a shift. The real pressure is coming from rising non-energy costs, with levies and policy decisions associated with that investment in renewables driving up bills."
He explained that a large share of these costs is tied to the essential work of maintaining the pipes, wires, and infrastructure that deliver energy—a cost that will only grow as the UK builds its net-zero system.
"The shift to renewables will bring long-term stability and energy independence, but it’s not free," he added. "The upfront costs are real, and they’re landing on bills now. The challenge will be balancing short-term affordability with long-term resilience."
The official price cap for the January period will be confirmed by the regulator Ofgem on 21 November.
