The second increase in Ofgem’s price cap this winter takes effect on Wednesday and means someone paying by direct debit and using a typical amount of gas and electricity will pay £1738 a year – £21 more than under the previous cap.
As such, billpayers not on a smart meter are being urged to submit a meter reading to avoid overpaying on estimated usage.
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“If you leave it any later than this, then some of your December energy usage could end up being estimated and therefore charged under the higher January rates,” said Elise Melville from price comparison site Uswitch.
This is despite Labour pledging on numerous occasions that they would reduce energy bills when they formed a new government.
Keir Starmer previously said he would cut bills by £400 and promised that GB Energy would help “cut people’s bills”.
Writing on Twitter/X on Wednesday, SNP Westminster leader Stephen Flynn shared a BBC article on the price cap rise.
He said: “A New Year gift from the Labour Party.”
Charities and campaign groups have also expressed concerns with Simon Francis, coordinator for the End Fuel Poverty Coalition, saying: “The public have seen first-hand the impact of the energy bills crisis – driven by our reliance on volatile energy markets.
“Over 800,000 Scottish homes experience fuel poverty, unable to heat their homes to a safe temperature or racking up massive debts just to pay their bills.
“Meanwhile 20 energy firms have made more than £483 billion in profits in recent years.”
Owing to rising prices, analysts at energy consultancy Cornwall Insight are also predicting an additional rise in the price cap in April of nearly 3%.
Elsewhere, Frazer Scott, chief executive of Energy Action Scotland, said it was “scandalous” that people were unable to heat their homes due to rising prices.
“Governments have all but removed the vitally important financial support that helps keep the lights on and heating going during this enduring crisis,” he said.
The Labour Government also faced heavy criticism for cutting the universal Winter Fuel Payment earlier this year – with the Scottish Government announcing it would introduce its own version of the payment to pensioners next winter.
Keir Starmer speech
The news comes as Starmer said the UK faces a “year of rebuilding” while also “rediscovering the great nation that we are” in 2025.
He added his Labour administration has begun the “work of change” since winning the general election in July and pointed to an increase in the minimum wage, clean energy projects and NHS investment as examples.
The 80th anniversaries of two notable moments of the Second World War – Victory in Europe (VE) Day and Victory over Japan (VJ) Day – also provide a chance for the nation to “come together” in 2025, Starmer said.
I wish you and your loved ones a very happy New Year. pic.twitter.com/iW4NTmSeg7
— Keir Starmer (@Keir_Starmer) December 31, 2024
In a video message, the Prime Minister said: “I know there is still so much more to do and that for many people it’s hard to think about the future when you spend all of your time fighting to get through the week.
“So I want to be clear: until you can look forward and believe in the promise and the prosperity of Britain again, then this Government will fight for you.
“A fight for change that will define this year, next year and, indeed, every waking hour of this Government.
“We have a clear plan for change: 1.5 million new homes – restoring the dream of home ownership; children starting school, ready to learn; a more secure energy system; waiting lists cut dramatically; immigration – reduced; neighbourhood police, tackling anti-social behaviour in every community; and more cash in your pocket, wherever you live.
“That is what we will be focusing on. A year of rebuilding, but also rediscovering the great nation that we are.
“A nation that gets things done. No matter how hard or tough the circumstances.”
Starmer said 2025 will offer time to “reflect on that” as he described the upcoming Second World War anniversaries as a chance to “cherish the greatest victories of this country, and the greatest generation that achieved it”.
He said: “The 8th of May and the 15th of August will both be wonderful moments, to come together and do that generation proud.
“But that victory – and indeed the peace and the prosperity that followed – all rested on that same foundation we must rebuild today.
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“The security of working people. That is the purpose of this Government. The goal of our plan for change. And we will push it forward in 2025.
“So, wherever and however you’re celebrating tonight, on behalf of the Government, happy new year.
“Here’s to a year of changing Britain for the better.”