LONDON: Energy regulator Ofgem has announced a 7% reduction of the energy price cap for the period covering July to September 2025.
A recent fall in wholesale prices is the main driver of the overall reduction, accounting for around 90% of the fall. The remainder is primarily due to changes to the operating cost allowances energy suppliers can recover. Direct Debit and prepayment customers will see standing charges fall by around £19 per year on average.
The price cap – which sets a maximum rate per unit and standing charge that can be billed to customers for their energy use – will fall by £129 for an average household per year, or around £11 a month, over the three-month period of the price cap.
For an average household paying by Direct Debit for dual fuel this equates to £1,720 per year. This is £660 (28%) lower than the height of the energy crisis at the start of 2023 when the government implemented the energy price guarantee. However, prices remain high with the upcoming level £152 (10%) higher than the same period last year.