As of July 1st, 2025, Ofgem announced that UK energy prices have fallen by 7% thanks to the latest price cap. Those on standard variable tariffs can expect their annual bill to drop to £1720 on average.
This news will come as a welcome helping hand when compared to the high energy cap price seen in 2022-23, where the average bill is estimated to be around £2,316 annually.
While the price drop is great news, households are still paying far more than pre-energy crisis levels. Before the energy crisis came into effect, households were paying on average £1000 less annually than they currently pay.
Energy bills have fallen by 7% thanks to wholesale energy prices settling down, but unfortunately, they still remain volatile due to risks with gas storage levels in Europe and global demand.
In the latest energy price report, Ofgem has announced that bills will be rising by 2% as of 1 October. Meaning the typical dual-fuel household can expect their annual bill to increase to £1755.
Fortunately, energy consultancy Cornwall Insight predict that energy bills will fall again by 2.6% in the first quarter of 2026.
Principal consultant at Cornwall Insight, Dr Craig Lowrey, said, "There is better news on the horizon with bills currently expected to ease in January, driven by a forecast fall in wholesale prices."
EDF Energy and British Gas also predict that energy prices will be lower in the first quarter of 2026 by 0.5%.
British Gas, however, also forecasts that prices will go up in April 2026 by £1830 per year. It's worth noting that British Gas forecast this price increase with 'very low' confidence.
