Energy Price Cap Details

Last Updated: 06/09/2025

From 1 October to 31 December 2025, the energy price cap has risen to £1,755 per year for a typical household paying by direct debit, an increase of 2% (£35) compared to the previous cap of £1,720.

Set by Ofgem, the energy price cap limits what suppliers can charge per unit of gas and electricity, as well as daily standing charges, for those on standard variable (default) tariffs. It ensures prices are fair and reflect underlying market costs, though it does not cap your total bill, usage still determines what you pay.

What’s Changed?

Electricity

• Before (Jul–Sep 2025):
  • Unit rate: 25.73p per kWh
  • Standing charge: 51.37p per day

• After (Oct–Dec 2025):
  • Unit rate: 26.35p per kWh
  • Standing charge: 53.68p per day

Gas

• Before (Jul–Sep 2025):
  • Unit rate: 6.33p per kWh
  • Standing charge: 29.82p per day

• After (Oct–Dec 2025):
  • Unit rate: 6.29p per kWh
  • Standing charge: 34.03p per day

Despite a small drop in wholesale energy costs, rising network charges, policy costs, and supplier operating expenses have driven the overall cap upwards. The full cost breakdown is reviewed quarterly and varies depending on how you pay and where you live.

With the next price cap announcement due on 25 November 2025, now may be a good time to explore fixed energy deals, many of which still undercut the cap, offering potential savings and greater protection ahead of winter.

Our expert says

“Despite wholesale gas prices falling by 44% since February 2025, it's more bad news for UK consumers as further price increases are now confirmed from 1st October 2025. Right now, there are deals offering savings of £316 a year, a reduction of 20%, meaning I urge all consumers to act fast and get on the cheapest possible deal now before we get into the cooler Autumn months." 

- Scott Byrom, Chief Executive Officer

When will the energy price cap change again?

What is the energy price cap?

The 'Energy Price Cap' is a legal requirement that energy suppliers must comply with in an attempt by Ofgem, the energy regulator, to protect households against unfair rises in gas and electricity costs and being overcharged for their home gas and electricity. The cap puts a limit in place on what suppliers can charge customers who are on either standard variable or default energy tariffs.

It is these tariffs that around 29 million of the UK remain on and are, in any normal time, amongst the most expensive forms of energy tariff with savings now available of around £160 below the new price cap level.

How do energy price caps work?

Price caps work by setting a limit on the rates a supplier can charge for each unit of gas and electricity. Many households are stuck on expensive default tariffs that they have fallen into after a fixed rate energy deal has expired, when they move in to a new property or if they have never switched their gas and electricity provider. With the cap in place, suppliers can only charge up to a set amount for their default energy tariffs, therefore apparently (as Ofgem claims) saving households money on their energy bills.

Your tariff details are on your energy bill. You can see if you are on a "Standard Variable" tariff or, if you switched to an energy supplier after another supplier went bust, a "Deemed Contract." If you are on a fixed-rate energy tariff, the cap will not apply to you until your energy tariff expires.

Even with the cap in place, this doesn't mean you won't end up paying more for your energy each year. Price caps are set at a unit price (the amount you pay for each kilowatt hour used) plus standing charges (the amount charged each day whether you use energy or not). With the cap being set by averaging out annual energy usage, if you use more energy than the medium Typical Domestic Consumption Values (TDCVs) - meaning "the average household", you will still be charged extra. Equally, if you use less, then your annual energy bill will be lower.

Price caps are also based on your region due to transportation costs and you could see higher rates if you don't pay by direct debit.

Why you should switch energy supplier

Usually, with the cap in place for standard variable or default tariffs, the best way to make big savings to your energy bills is to switch to a cheaper, more often "fixed", energy tariff. This could be with your existing energy supplier or moving to a new one altogether. As the price cap doesn't protect you from price fluctuations, it's generally best to consider a fixed rate plan to lock in your energy costs for a set period of time, e.g. 12-24 months.