How Energy Price Cap Affects Energy Bill Calculator

Gas and electricity supply on standard variable tariffs and prepayment meters. It protects households from sudden price rises caused by changes in the wholesale cost of gas and electricity but does not cap your total bill — the more energy you use, the more you pay.

It uses official data from Ofgem, which reviews the price cap every three months. As of October–December 2025, the typical household pays about £1,755 per year on a dual fuel direct debit plan. You can use the energy bill calculator to check your own costs and compare energy prices across different suppliers to find cheaper rates.

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What is the Ofgem energy price cap and why does it exist?

The Ofgem price cap began in January 2019. The main idea is to make sure that homes with default or variable energy tariffs do not pay too much for their energy supply. The price cap can help people save money. It also helps people get a good deal with their energy tariffs.

It gives a limit on how much energy suppliers in Great Britain can charge for each kWh. This is called the unit rate. The rule also decides the most that can be asked for the daily fee, which is called the standing charge. It is for around 23 million homes in Great Britain.

The cap adjusts each quarter to reflect:

• Wholesale cost of gas and electricity.
• Network charges (National Grid maintenance).
• Operating costs of energy companies.
• Government environmental schemes.
• Supplier profit margin (EBIT allowance).

What are the current price cap levels for October–December 2025?

The new price cap level is set for a typical household. This is for a home that uses about 2,700 kWh of electricity and 11,500 kWh of gas every year.

*For standard variable tariff, direct debit payment, Ofgem October–December 2025.

The cap went up by 2%. It went from £1,720 in July to September 2025. A rise in network and supplier costs made it go up, even when the wholesale cost of gas went down a little.

How does the price cap affect your energy bill calculator results?

When you use the energy bill calculator, it checks your cost of energy with the most recent price cap and standing charges. This helps make sure what you get matches the true cost of energy that Ofgem puts for your area.

The calculator uses:

1. Regional unit rates for electricity and gas.
2. Standing charge values for each type of meter.
3. Your energy usage (kWh) from smart or manual meter readings.
4. Tariff type – variable, fixed, or prepayment.

By combining these, you get a realistic estimate of your annual and monthly energy bills.

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How does the price cap differ for variable and fixed energy tariffs?

Households on a variable tariff or default tariff are directly protected by the cap.
Those on fixed rate deals are not covered — their unit rate and standing charge stay the same for the fixed term.

Why are standing charges important under the price cap?

The standing charges on energy bills have been rising faster than the unit rates since 2022. Right now, they make up about 10 to 15% of what people pay on their energy bills.

Even if you use no gas or electricity, you still pay the standing charge to remain connected to the National Grid and maintain your energy supply.

This affects low-use households the most — even efficient or solar-powered homes must pay a minimum connection cost.

Prepayment Meter Tariffs – Find Cheaper Options Today

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How do regional unit rates change your results?

The price cap changes in different places in Great Britain. This happens because it costs more to run the network in some areas than in others.

If you put your postcode into the utility bill calculator it automatically applies your region’s unit rates, showing how much your local area affects your total bill.

How does your type of meter affect energy prices?

Since July 2023, Ofgem made the daily standing charges the same for people using direct debit and those who pay with prepayment. Both groups now pay about the same each day.

How does household energy use change the impact of the price cap?

The price cap is set by looking at what a typical household spends on energy. Your bill can go up or down. It depends on how much energy you use.

If you use more energy, then you will have to pay more money. The cap does not set a limit on how much you spend in total.

Adding devices like heat pumps, electric vehicles (EVs), or new solar panels can change your electricity usage. Using a smart meter helps track how much energy you consume, especially during peak hours.

How do price cap changes affect households across Great Britain?

Electricity prices are up by 36% since 2019. Gas prices have gone higher, going up by 81% in that year. The cap is lower than it was in the crisis. But variable rates change often. These rates go up and down with the cost of buying energy and what takes place in global energy markets.

Why has the price cap risen this quarter?

The October 2025 price cap went up. It’s because things cost more in these areas:

• Network charges: +£24 (National Grid and local pipes)
• Supplier costs: +£6
• Environmental schemes: +£17
• VAT impact: +£2
• Wholesale cost of gas: –£15 (slight drop)

The net result is a 2% increase overall. A typical household will have to pay about £35 more every year.

How can you lower your energy bills under the price cap?

Even though the price cap is set to keep things fair, you could still pay less. All you have to do is change how much you use.

• Use your appliances when it is not peak hours. This helps you get the most out of smart tariffs and EV tariffs when there are cheaper rates.
• Put in solar panels or choose SEG tariffs. You could get credit back from the electricity that you make and send to the grid.
• Check your energy usage often with the smart meter or by using an energy app. You can see how much energy you use.
• Compare energy tariffs to find a cheaper energy deal or fixed tariff before the next cap update.
• Upgrade insulation or heating systems like heat pumps to lower gas bills.

Compare energy prices to find a better tariff

What happens when you switch after a price cap change?

When switching energy suppliers:

1. Your current energy supplier takes the last reading from your meter.
2. Your new energy supplier will use the latest price cap level or fixed tariff rate for your bill.
3. The Energy Switch Guarantee makes sure your energy supply does not get cut off.

Check for an exit fee if leaving a fixed deal early. Most standard variable tariffs have none, so you can switch any time.

Find cheaper rates with the updated calculator

How the energy bill calculator updates after each price cap change

The calculator updates within days of each new Ofgem price cap announcement. It uses published regional and national data to update:

• Electricity unit rate
• Gas unit rates
• Standing charges
• Regional network costs

You can check how much your energy usage and location affect the cost of energy immediately after every update.

How the price cap affects different payment methods

Using direct debit ensures consistent payments and usually offers the lowest energy tariffs.

How does the calculator help plan for solar panels or EVs?

If you install solar panels or switch to EV tariffs, your energy usage will change significantly. The calculator allows users to:

• Input lower electricity use due to solar generation.
• Add EV charging to see new total energy costs.
• Estimate savings through SEG tariffs (Smart Export Guarantee).

You can run these calculations to decide whether investing in new solar panels or EV charging suits your specific needs.

Estimate your future costs with solar or EV charging

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Benefits of using the calculator during price cap periods

• Shows how price cap changes affect real bills.
• Includes regional unit rates and standing charges.
• Adjusts for tariff type, payment method, and energy usage.
• Helps identify cheaper energy deals with no exit fee.
• Reflects true cost of energy across all energy suppliers in Great Britain.

FAQs About the Energy Price Cap and Calculator