The parliamentary Business and Enterprise Committee, made up of members from the country's main political parties, said in a report that millions of households were likely to be affected by energy price rises soon.
It voiced concerns that energy markets are not functioning as efficiently as they should and called for reform through improved market design, regulatory changes, and by continuing to work for liberalisation of European markets.
"Gas and electricity bills for domestic consumers (will) rise significantly in the near future, over and above the increases already announced this year, with serious consequences for millions of households, and especially the fuel-poor," the report predicted.
"Industrial consumers now face prices above European levels. If these price differentials are sustained, they will affect the competitiveness of the UK economy, and put many thousands of jobs in manufacturing at risk."
Labour is under increasing pressure to deal with rapidly rising fuel and food prices.
Earlier this month the government postponed a planned rise in fuel duty planned for October for at least another six months because of soaring world oil prices and in a bid to keep the headline rate of inflation down.
But many people have called for the government to go further and have criticised the energy supply companies for hiking prices whilst reporting soaring profits.
In February, the country's energy watchdog Ofgem launched an investigation into power and gas supply markets because of growing public concern over price rises.
Ofgem always monitors Britain's power and gas markets and has previously said it had not uncovered any price collusion between the big six suppliers, despite rising concern over ballooning bills.
"Just because we have found no evidence of collusion does not mean we have given the 'Big 6' energy companies a clean bill of health - far from it," Business and Enterprise Committee Chairman Peter Luff said.
"It is clear that there are very real problems in the energy markets at all levels, and going beyond these six companies, which need to be addressed."
He said some of these were strategic issues such as the functioning of wholesale markets, while others were more specific concerns such as how suppliers conduct their doorstep sales to encourage switching.
The report also called for the government to undertake "a fundamental re-think" of its approach to tackling fuel poverty - the number of households who spend more than 10 percent of their income on energy costs.
