ONS Survey: Business Energy Worries Hit 64% as Ofgem's Cap Rises 4%
New ONS data show energy-cost concern among UK businesses jumped in September, days before Ofgem's household price cap rose 4% for autumn - though a VAT cut on electricity softens the impact for many homes.
Energy anxiety climbs among UK businesses just as household bills rise
UK businesses' concern about energy prices jumped to 64% in early September 2026, according to the Office for National Statistics (ONS), up five percentage points from late August, as the same month brought a fresh round of Middle East-linked wholesale gas price rises. The finding lands just days before Ofgem's household energy price cap increases by 4% from 1 October, though a simultaneous government VAT cut on electricity means most households will not see bills rise by the full 4%.
What the ONS survey found
The figures come from wave 164 of the ONS's Business Insights and Conditions Survey (BICS), a voluntary fortnightly poll of private-sector firms that was live from 7 to 20 September 2026 and published on 24 September. It drew 10,256 responses from 38,579 sampled businesses, a 26.6% response rate. The ONS classifies BICS results as "official statistics in development", meaning estimates carry sampling variability and non-sampling error.
- 64% of businesses reported some concern about energy prices in early September, up 5 points from late August, with firms citing the conflict in the Middle East as a reason.
- 29% of trading businesses reported paying more for goods and services bought in August, up 6 percentage points on a year earlier.
- 17% of trading businesses expect to raise their own prices in October, up 3 points on expectations a month earlier and 7 points on October 2025.
- The construction industry had the highest share planning October price rises, at 32% - the highest for that industry since February 2023.
Hospitality feels the strain most
Concern was sharpest in hospitality: 90% of businesses in the accommodation and food service industry reported worry about energy prices, the highest share since the ONS began asking the question in March 2026. Wider cost pressure also showed up in turnover data - 28% of trading businesses reported falling turnover in August, up six points on July, with economic uncertainty the most commonly cited challenge for turnover overall and cost of labour the top concern for larger employers.
Price cap rises 4%, but VAT cut cushions electricity
Ofgem confirmed on 26 August that its default-tariff price cap will rise 4% from 1 October to 31 December 2026 for a typical household paying by direct debit for both electricity and gas. Under the new cap, electricity costs an average of 26.32 pence per kilowatt hour with a 54.83 pence daily standing charge, while gas costs 7.97 pence per kWh with a 29.68 pence standing charge. The cap applies to households on default tariffs paying by standard credit, direct debit, prepayment meter or Economy 7; anyone who has switched to a fixed-rate tariff is unaffected.
The headline 4% rise does not translate directly into a 4% bill increase for most households, because the government has also removed VAT from electricity bills between 1 October 2026 and 31 March 2027. The published electricity rate excludes that VAT, while gas continues to carry 5% VAT. Ofgem says the change means costs cannot be compared directly with previous periods, and that households who use more electricity than gas - or only use electricity - will see a bigger reduction in their bill from the VAT cut, partly offsetting the cap increase.
Why energy costs are climbing again
Ofgem attributes the increase to higher wholesale gas prices driven by the ongoing conflict in the Middle East - the same reason BICS respondents most often gave for their own rising energy worries. The regulator notes that prices remain well below the peak of the 2022 energy crisis, when the government capped typical household bills at £2,500.
What it means for household and business bills
For shoppers, the two releases read together suggest cost pressure has not eased: with almost a third of trading businesses reporting higher input prices and one in six planning to raise their own prices in October, energy costs cited by struggling local shops and cafés are consistent with the ONS data, even though the survey cannot attribute any single business's price rise to energy costs specifically. For households, the practical effect of the price cap change depends heavily on how much electricity versus gas a home uses, its location and meter type - Ofgem does not publish a single pound-and-pence bill impact figure.
What's still unclear
BICS is a voluntary survey and the ONS labels it "official statistics in development", meaning wave-to-wave changes carry inherent statistical uncertainty. No ONS or Ofgem publication links the two datasets directly; reading the business energy-concern figures alongside the household price cap change is an independent comparison of two official releases from the same period, not a claim made by either body itself.
Sources and context
- Business insights and impact on the UK economy: 24 September 2026Office for National Statistics (ONS)
- Changes to energy price cap between 1 October and 31 December 2026Ofgem
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