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Energy prices will fall by 7% in July for millions of households. But after recent punishing energy price hikes, costs will still be high. We look at what’s expected to happen and how you can save on your energy bills.
AT A GLANCE
Energy bills will fall by 7% in July 2025 for millions of UK households when the new energy price cap, set by Ofgem, comes into force. This means a typical annual bill for a dual-fuel customer paying by direct debit will cost £1,720, down from the current level of £1,849.
But you could make bigger savings on your energy bills by shopping around and fixing your tariff. Ofgem says this could give annual energy bills savings of £200 – read on for more on this.
Ofgem announces its next price cap around 6 weeks ahead of it coming into force. But a number of energy price cap forecasts are made much further in advance:
The further ahead the forecast, the less likely it is to be accurate. British gas says, ‘The energy market has been more stable recently, but surprises can happen. Global politics play a big role in energy prices. For example, if conflicts in Ukraine, or the Middle East worsen, wholesale gas prices could go up. This would eventually mean higher bills.’
Find out instantly how much you can save on energy bills with our free switching service today
Compare energy deals, see how much you can save on electricity and gas, switch provider today.
Yes. Consumers are being urged to shop around for cheaper energy deals despite energy bills set to fall in July. Ofgem says shopping around and switching to a fixed deal could save money for many customers; it says shopping around could lead to an annual saving on energy bills of £200.
“I want to remind people that you don’t have to pay the price cap – there are better deals out there so it’s important to shop around, and talk to your existing supplier about the best deal they can offer you,” said Tim Jarvis, director general of markets at Ofgem.
Some 35% of households are currently on fixed energy tariffs compared to just 15% a year ago when fewer deals were available.
Energy advice guru Martin Lewis says, “The cheapest year-long standalone fixes right now are about 18% LESS than the current Cap (about 12% less than the new July Cap), so if you get a good fix now you can lock in at a cheaper rate for a year, get price certainty and save instantly.
There are also energy deals available that track under the energy price cap. Or that follow the energy price cap’s unit rates but have lower standing charges. So make sure you shop around and switch energy suppliers ASAP if you find a better deal.
But bear in mind that exactly what will happen to energy prices in the longer term is subject to debate and global developments.
Compare energy deals, see how much you can save on electricity and gas, switch provider today.
July’s energy price cap fall will see energy bills go down for millions of households. But it’s important to note that the reduction in energy costs will come after a succession of price hikes.
This table illustrates how much energy prices have increased in recent months.
| Time period | Energy price cap amount |
| Old cap: 1 October -31 December 2024 | Up 10% to £1,717 a year |
| Old cap: 1 January – 31 March 2025 | Up 1.2% to £1,738 a year |
| Current cap: 1 April – 30 June 2025 | Up 6.4% to £1,849 |
| Future cap: 1 July-31 September 2025 | Go down to £1,720 |
If you’re one of the 21 million households in the UK on a standard variable tariff, here’s how the new price cap will change how much you pay:
| CURRENT Energy price cap rates from 1 April to 30 June 2025 | FUTURE Energy price cap rates from 1 July to 30 September 2025 | |
|---|---|---|
| Gas | Unit rate: av 6.99 per kWh Standing charge: 32.67p per day | Unit rate: av 6.33 per kWh Standing charge: 29.82p per day |
| Electricity | Unit rate: av 27.03p per kWh Standing charge: 53.80p per day | Unit rate: av 25.73p per kWh Standing charge: 51.37p per day |
UK households have been facing increased energy costs since 2022, when the conflict between Russia and Ukraine broke out. While energy costs aren’t as high as the peaks we’ve seen, energy prices are still high and unaffordable for many.
Avoid rising energy prices and save money by switching to a fixed energy deal. Find out instantly how much you can save with our free switching service today
Compare energy deals, see how much you can save on electricity and gas, switch provider today.
Cornwall Insight predicts that prices will remain relatively flat over the next three years, before beginning to fall from 2028. It expects that improved gas supplies will be better supported by renewable energy. The consultancy says a possible end to the war in Ukraine would also help ease pressures on energy.
But it says wholesale prices are likely to remain well above averages seen during the last decade, even by 2031.
Yes, most people will be able to save on their energy bill by shopping around and switching to a cheap fixed tariff or a variable deal that charges less than the energy price cap. We’ve partnered with The Energy Shop to provide you with an instant tool for comparing tariffs and seeing how much you can save.
When you’re comparing deals, remember to check how long the fixed deal lasts for any whether you’ll need to pay any exit fees if you want to leave before the end of the deal.
It’s also a good time to check for the best deal if you’re moving house, if your current supplier has poor customer service or you want a specialist tariff such as an EV tariff.
Paula Higgins, Chief Executive of the HomeOwners Alliance, says, ‘Households will welcome the predicted falls in energy prices but after so many energy bills hikes, bills will still be high. We advise people to shop around and switch energy suppliers to ensure you’re on the best deal for you.’
Compare energy deals, see how much you can save on electricity and gas, switch provider today.
Once you’ve shopped around for the best energy deal, the other way to save on energy bills is to use less. You can do this by:
For more ideas read out Top 10 Energy Saving Tips guide
Yes, some help is available for energy bills. For example, individual energy companies have hardship funds. Find out more in our guide on Energy grants and how to get them.
Avoid rising energy prices by shopping around and switching to a fixed energy deal. Find out instantly how much you can save with our free switching service today
Compare energy deals, see how much you can save on electricity and gas, switch provider today.
Here are the historic price changes to Ofgem’s energy price cap, which shows how energy bills have increased and decreased in recent years.
| Price cap period | Ofgem energy price cap | Price cap change vs previous period |
| April – June 2025 | £1,849 | +6.4% |
| January – March 2025 | £1,738 | +1% |
| October – December 2024 | £1,717 | +10% |
| July – September 2024 | £1,568 | -7% |
| April – June 2024 | £1,690 | -12% |
| January – March 2024 | £1,928 | +5% |
| October – December 2023 | £1,834 | -7% |
| July – September 2023 | £1,976 | -37% |
| April – June 2023 | £3,116* | -23% |
| January – March 2023 | £4,059* | 20% |
| October – December 2022 | £3,371* | 80% |
| Summer 2022 | £1,877 | 54% |
| Winter 2021/22 | £1,216 | 12% |
| Summer 2021 | £1,084 | 9% |
Source: Ofgem data. *This was replaced by the £2,500 Energy Price Guarantee
