Energy Price Cap October 2025: What It Means for Your Bills

What is the energy price cap?

The energy price cap is the highest amount that an energy supplier can ask for in Great Britain. This is for customers who are on a default tariff, which is a standard tariff where prices can go up or down. The energy regulator Ofgem is the one that decides the limit. The main goal of this is to help people the and make sure they do not pay too much for their electricity or gas prices.

The price cap sets the top price for the unit rates (per kilowatt hour) and also for the daily standing charge. This is meant to keep costs under control and be fair for all.

The price cap changes every three months. It shows how much people may pay for energy. The price cap level includes the cost of energy. This cost has things like wholesale gas prices, network charges, and policy costs. It also covers what suppliers get for doing their work. Wholesale gas prices and policy costs are big parts of the cap level. The cap level helps people know the cost of energy and what they will pay.

From 1 October to 31 December 2025, the cap level will go up by 2%. A typical household will see its annual bill reach £1,755 during this time. People will pay about £35 more for the year. That is around £2.93 more each month compared to the current level set in July 2025.

Why has the price cap increased in October 2025?

Ofgem said that today’s change is happening because network operator charges are now more. The price is also rising since the warm home discount scheme is getting bigger.

• Network costs: The fees that people pay to network operators who keep the pipes and wires working have gone up.
• Policy costs: The UK government’s Warm Home Discount now helps 2.7 million more homes. Because of this, costs have gone up for suppliers.
• Wholesale prices: While wholesale gas prices are not at the record high from 2022–23, they are still linked to volatile international gas markets.

Even after this price rise, the cap is still £625 lower than it was last year. In early 2023, people had to deal with high energy costs. That time was the worst part of the energy crisis.

What are the new unit rates and standing charges?

The cap level is based on how much energy a typical household in Great Britain uses. Your bill will be set by the type of meter you have. The amount you pay also depends on the tariff and how much energy you use.

Here are the official figures for October to December 2025.

For an average home, if you use the typical amount of energy, it means about 2,700 kWh of electricity and 11,500 kWh of gas every year. When you are on the default tariff, your annual bill will be £1,755.

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How do different payment methods affect the cap?

The price cap might change, depending on how you pay your energy bill.

• Direct Debit → This way has the lowest cap level. You can get a discount if you pay at the right time.
• Standard Credit (cash/cheque) → This will cost more, because the risk is bigger that people may not pay.
• Prepayment meters → A different cap level is used here. They have protections like emergency credit, to help you if you have trouble with paying.

For many homes, the best way to pay your energy bill is by setting up direct debit. This can help you not miss any payments and helps you avoid energy bill defaults.

What support is available for vulnerable families?

The warm home discount scheme will help more people this winter. It will offer essential support to vulnerable families, and to those who face fuel poverty. The warm home discount can help your home feel warmer, and help you save money on the bills. The goal is to make sure all people get the help they need through this scheme, especially when it gets cold.

• About 5 million households will get help from this.
• The discount takes £150 off the electricity charges on your bill.
• If your household can get this help, it will be added to your account on its own, so you do not have to do anything.

Other protections include:

• The emergency credit helps people who use prepayment meters.
• There is now a limit on the maximum amount energy suppliers can ask for from homes that have trouble with paying their bills.
• In winter, fuel payments and special cold weather payments are given to pensioners and people who have low income.

How does the energy cap link to wholesale gas prices?

The cap level is set by looking at how wholesale gas prices and electricity prices change. In the UK, gas is used as a part of the energy mix. Because of this, when gas prices go up or down across the world, it can make household bills go up as well.

• Last year, energy prices went up a lot because people were worried about the supply. This made bills the highest they had ever been.
• This year, there are signs of a healthier market. But some risks are still out there. A big risk is still the volatile international gas markets.
• Ofgem says that, in the longer term, future energy prices could go up or down a lot.

Does the cap guarantee lower bills?

The energy price cap does not set the amount you have to pay for your total bill. It is there to control how much you pay for every unit of energy you use and the daily standing charge. Your total bill will go up or down depending on your energy usage.

• A typical household pays £1,755 for the bill. If you use more energy, you will have to pay more.
• Some homes watch their energy use. People in these homes use less energy, so they can pay less than the typical household energy use amount.
• The cap is for default tariffs only. It does not be for fixed tariffs.

Should I switch to a fixed tariff?

With the price cap level at £1,755, some suppliers now give you fixed tariff options. These deals let you lock in your energy price for one or two years. A fixed tariff means your bills stay the same, even if the price cap or cap level changes later on.

• Fixed tariffs can help you keep away from a price rise later on. This can be a good thing if gas prices or wholesale gas prices go up again.
• But if the cap level goes down in January 2026, which some people say could happen, fixed deals may end up costing more than the default tariff.

Before people change to a new provider, they need to check energy prices very carefully. It is important to see if one offer is better than another. This is a good way to save money on the energy bills at home.

What does this mean for the average home?

The new cap level tells you what most people pay for average gas and electricity charges. Here is a look at the usual costs for both.

These numbers show how different costs affect people at home. You can see how this is linked to their energy usage.

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How does this affect energy security in Great Britain?

The UK government and Ofgem say that it is good to have an energy mix. A mix of clean energy and other types can help make sure people in the UK have energy all the time. This is important for their safety if things change later. A strong energy mix can help homes feel safe and be ready for what comes next.

• Adding more renewables to the grid can help us lower our use of volatile international gas markets.
• When we spend money for energy security, it is there to keep us safe if there are supply problems in the world.
• Ofgem says customer satisfaction will get better when people know they are safe with a system that is fair and stable.

Will energy prices fall in the longer term?

Analysts say that energy prices may go down in January 2026. This may be because of changes in the wholesale markets. A lot of people want to know what will happen with future energy prices, so they watch the market closely. If there is a big change in how wholesale markets work, energy costs might drop. We will have to wait and see what happens then.

• If gas prices around the world go down, the cap level could be lower by 5% to 10%.
• This means the typical household annual bill could be close to £1,650.
• But if there are new problems with getting gas, bills could go up again.

This is why many people at home want to learn more about energy prices. They also want to see if a fixed tariff is going to help them. A lot of us look at these choices because we feel unsure about what will happen next. Many families like to check and compare energy prices, and some will choose a fixed tariff to feel more safe.

Where can I check the latest updates about the energy price cap?

The energy regulator Ofgem gives new price cap updates four times a year. Each time, they tell us the cap level, unit of energy rates, and the daily standing charge for both gas and electricity.

Households in Great Britain will notice new details on their energy bill. Suppliers need to show the new rates when they talk to customers. For more information, top broadcasters and newspapers talk about today’s change as soon as it comes out. They let you see how the current level compares with last year’s cap.

If you want to see how energy prices can change what you pay, you can look and compare energy prices. You can also check if a fixed tariff is good for your home and the people who live with you. This can help you know what works best for you.

Does the energy price cap change differently for gas and electricity?

Yes, the price cap level is shown as a single number for what a typical household pays each year. But this price cap is made up of several unit rates and standing charges. This is true if you use gas or electricity.

For October to December 2025:

• Electricity charges be 26.35p for each kilowatt hour. You also have to pay a daily standing charge of 53.68p.
• Gas prices be 6.29p for each kilowatt hour. There is a daily standing charge of 34.03p that you will have to pay.

This means the cap level is decided by looking at both gas prices and electricity prices. It is set based on how much energy a typical household would use. If you use more gas or electricity in your home, your total bill might go up. Your bill may not match the Ofgem estimate for energy use by a typical household.

Correct as of 27 August 2025

FAQs about the October 2025 Energy Price Cap