British Gas has confirmed it will hike up gas and electricity tariffs by 6% from next month, or £80 a year - leaving consumer groups warnings some households will be "scared to turn on heating for fear of the cost" this winter.
The latest blow will hit 8.5m households, although another one million British Gas customers on fixed price contracts will be unaffected.
British Gas managing director Phil Bentley said rising costs that are largely outside the company’s control but which make up most tariffs were to blame.
The pre-winter increase comes just months after British Gas announced a 23% leap in half-year profits at its residential arm to £345m
Ann Robinson, director of consumer policy at uSwitch, said the increase would leave many households facing a winter where they are "scared to turn on heating for fear of the cost" while Scott Byrom, energy expert at MoneySupermarket.com said stretched households faced a "bleak outlook."
“Unfortunately, a round of price hikes now means bills increase just in time for the more costly Winter months when energy usage is at its highest," he said in a statement.
The pre-winter increase comes just months after it announced a 23% leap in half-year profits at its residential arm to £345m.
Rival SSE, which trades as Southern Electric, Swalec and Scottish Hydro, is due to increase tariffs by 9% on average on Monday, hitting about five million electricity customers and 3.4 million gas customers.
Other big suppliers - including EDF, Scottish Power and nPower - are not expected to follow suit and announce higher prices. E.ON is the only supplier to guarantee a price freeze this year.
Centrica said prices in the wholesale market for gas this winter are around 13% higher than those paid for the same period last year.
British Gas has confirmed it will hike up gas and electricity tariffs by 6% from next month
Assuming normal weather conditions and despite today's price rise, Centrica said British Gas Residential profits for the second half of 2012 are expected to be around 15% lower than for the same period of 2011.
Centrica estimates its residential margins after tax in 2012 will be 5p in the pound - a similar level to last year and lower than the prior year.
Bentley said: "Unfortunately, we cannot run our business sustainably on lower margins and still make the investments in jobs and future energy sources that Britain needs, especially if the country is to grow its way out of recession."
Attention will now switch to the other big suppliers - EDF, Scottish Power and npower - while E.ON has guaranteed a price freeze for 2012.
Citizens Advice chief executive Gillian Guy has said the price rise could be "really frightening".
"Bill increases throw already stretched budgets into turmoil, with people forced to find more ways to scrimp and save,” he said. “But there are things that people can do to save money on their fuel bills."
Reacting to the news energy minister Greg Baker said: "There's no easy answers here. There's no way to dress this up as anything other than tough for people who are struggling with bills. This isn't welcome news.
"What they expect from a responsible government is taking decisions that will help them in the short term and also get a grip on the market to help it deliver better value in the future."
The news comes days after the national farmers union said food prices are likely to rise after poor harvests.
Further utility bill increases will play havoc with the Bank of England's inflation forecasts, which predicted a gradual slide in the consumer price index rate towards the end of the year and into 2013.
While inflation has fallen from 5.2% in September last year to 2.5% in August this year, many economists expect the rate to rise again as droughts in the US and poor summer weather in the UK are likely to mean higher food prices.