Headline: Energy Price Cap to Rise 4% as Labour Faces Criticism Over Household Bills

Date: 26 August 2026

Tags: Energy, Cost of Living, Politics, Economy

Summary:

• Ofgem has confirmed the household energy price cap will rise by 4% from October 1.

• The typical annual bill will increase by £60, from £1,663 to £1,723, through the end of December.

• Shadow Environment Secretary Victoria Atkins accused Labour of breaking promises to reduce household energy costs.

• Atkins said rising bills could create particular difficulties for rural households dependent on heating oil.

• She also warned that higher energy costs and taxes could increase financial pressure on businesses.

• The Conservatives propose removing VAT and carbon-related charges from electricity while abandoning current Net Zero policies.

• Energy Secretary Miatta Fahnbulleh said higher energy costs were being driven by the Iran War.

• The Government will cut VAT on electricity from October, saying the measure has limited the price-cap increase.

• Ministers previously removed £150 of costs from bills and say further measures to support households remain under consideration.

Why this matters: Higher energy costs will add pressure to household finances ahead of winter and could increase operating costs for businesses.

What’s next: The new price cap takes effect on October 1 and will remain in place until December 31.