What is the Energy Price Cap?

What is the Energy Price Cap?

The Energy Price Cap is a way of controlling the price that suppliers can charge for a single unit of energy. Suppliers are the companies that sell energy to households. Ofgem, the energy regulator, sets a maximum price that energy companies can charge per unit of electricity or gas.

Ofgem review and update the price cap every three months, and announce new costs around:

• 27 August 2024 for the period 1 October to 31 December 2024
• 25 November 2024 for the period 1 January to 31 March 2025
• 25 February 2025 for the period 1 April 2025 to 30 June 2025

The Energy Price Cap is usually described by saying how much the average user would pay for their energy. At the moment, the Energy Price Cap is set at £1,568 per year for a typical household who pay by Direct Debit in Great Britain until the end of September 2024. However, a household that uses twice as much energy as the average household would get a bill for much more than £1,568. And a household that uses half as much energy as an average household would get a bill for much less than £1,568. 

The actual rates you are charged will also depend on where you live, how you pay your bills and the type of meter you have.

What has changed? 

From October 2024, the Energy Price Cap is set to increase by 9.5% to £1,717.

What does this mean for you?  

If you are on a default energy tariff (also called a Standard Variable Tariff or SVT), the Energy Price Cap applies to you. If you aren’t sure what kind of tariff you’re on, you can check your energy bill or talk to your supplier.  

The Energy Price Cap is not applied to your total energy bill – it is applied to each individual unit of energy. If you use more energy, you will pay for more. So your energy bill might be higher or lower than the £1,717 average figure depending on how much energy you use.  

How will you notice the changes?  

To find out how much your energy is likely to cost, you can check the details on your energy bill.  Make sure you are supplying regular and correct meter readings, so your supplier knows how much energy you’re actually using and can keep your bills accurate. 

What help is available? 

Read what financial support may be available to you if you're struggling with energy and water bills.