Ofgem’s new price cap will see energy bills rise from £1,738 to £1,849 from April 1 for a typical dual fuel household.
Dr Craig Lowrey, Cornwall Insight principal consultant, said: “Households have been hit hard over the past few months, and with bills set to rise for a third consecutive time the pressure is not letting up.
Below we look at what the price cap is and what could happen to your energy bills in future.
The cap limits how much suppliers can charge you per unit of gas or electricity and are based on how much it costs, on average, to get energy to your home. They also set a maximum daily standing charge, the cost of being connected to the grid.
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Caps only limit bills for consumers on a standard variable energy tariff, not those on a fixed rate tariff.
Despite Russia’s invasion of Ukraine happening over a thousand miles away, its effects have still been felt closer to home.
However, prices are expected to fall in the short term before rising again.
The government’s drive to expand renewable energy capacity is also expected to reduce energy bills in the long run, replacing expensive fossil fuels with more affordable sustainable energy and decreasing dependence on the volatile international wholesale market.
Supplier EDF’s price cap predictions for the rest of 2025 show some fluctuation in the cap, with £1,839 for July to September and £1,859 for October to the end of December 2025.
Should households move to a fixed tariff?
This means whether price caps rise or fall, the unit rate and standing charges you pay remain the same, providing bill payers with certainty about their finances.
If the price cap drops, being on a fixed tariff may not be the best option as you could be paying more for energy that the standard rate.
However, should energy prices rise again, you should be shielded from the effects.
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