Energy Price Cap Drops in July 2025 – What It Means for Your Bills

If you’re wondering how your energy bills will change this summer, here’s the good news: they’re going down, but not by as much as you might hope. 

From 1 July 2025, the energy regulator Ofgem is cutting the price cap on standard variable tariffs by 7%, bringing average annual bills for a typical dual-fuel household down from £1,849 to £1,720. That’s a saving of around £129 a year, or roughly £10.75 per month. 

Why your bill might still not feel cheaper 

Even with this cut, bills remain significantly higher than pre-crisis levels. Standing charges, the fixed daily fee you pay regardless of how much energy you use. are still elevated. And while unit rates (the price per kilowatt-hour) are falling slightly, most households won’t feel a big difference unless they actively reduce consumption. 

Here’s how the new rates compare for a typical user paying by direct debit: 

Charge Type	Before (Apr–Jun)	After (Jul–Sep)
Electricity unit rate	27.03p/kWh	25.73p/kWh
Electricity standing charge	53.80p/day	51.37p/day
Gas unit rate	6.99p/kWh	6.33p/kWh
Gas standing charge	32.67p/day	29.82p/day

Who does the price cap apply to? 

This cap applies to: 

• Customers on standard variable tariffs (SVTs), typically the default after fixed deals end 
• Those who pay by direct debit, standard credit, or prepayment meters 

If you're on a fixed deal, this cap won’t affect you unless your term is ending soon. 

What should you do now? 

1. Make sure your energy bills reflect your actual usage 
If you don’t have a smart meter, now’s a good time to check your meter and provide an up-to-date reading to your supplier. This helps avoid being charged based on estimates, especially as prices drop from 1 July. It ensures you’re only paying the higher spring rates for energy you used - not more. 

2. Consider switching to a fixed-rate tariff 
With the price cap falling, some energy suppliers are offering fixed-rate deals that undercut the current cap. Locking in a lower rate now could protect you from potential price rises later in the year - especially if forecasts for autumn point to another increase. Always compare options to see if a fixed deal could save you money based on your usage. 

3. Take advantage of lower summer usage 
With gas heating usage low in summer, now’s a good time to reduce unnecessary electricity use - turn off standby devices, wash at lower temperatures, and monitor your usage through smart apps. 

Bottom Line 

Your energy bills are coming down this summer, but the relief is modest. With prices still high historically, and another cap review due in October, it pays to: 

• Submit meter readings 
• Compare fixed deals 
• Reduce your summer energy use 

This is a good opportunity to review your energy usage and tariff, as some households may be able to reduce costs through switching or improved efficiency. 

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