Ofgem's new energy price cap, which launched on 1 July, pushed typical annual household bills up 13 percent. The cap sets the maximum price suppliers can charge for gas and electricity, adjusted quarterly based on wholesale costs and network expenses.
The 13 percent increase affects millions of UK households immediately. Those on default tariffs will see higher standing charges and unit rates for both gas and electricity. The rise follows earlier cap increases and reflects ongoing volatility in global energy markets, particularly natural gas prices tied to geopolitical tensions and supply chain disruptions.
Households can mitigate costs by switching suppliers, improving insulation, or upgrading to more efficient appliances. Those eligible for government support programs, including winter fuel payments or energy bill discounts, should verify their eligibility. Renters and those in vulnerable situations may qualify for additional assistance.
The cap impacts roughly 24 million households on standard variable rates. Fixed-rate customers locked into earlier deals won't face immediate changes, though many face higher rates when their contracts expire. Ofgem reviews and adjusts the cap quarterly, meaning further changes arrive in October based on updated wholesale price forecasts.
Energy companies argue the cap constrains their margins during a period of historically high wholesale costs. Consumer groups counter that the increases create genuine hardship, particularly for low-income households already stretched by inflation in food and other essentials. The government has indicated it may intervene with additional support depending on winter conditions and energy market trends.