Energy price cap
Our latest update on Ofgem’s price cap and how it affects our customers. Get ahead of winter energy prices with our cheapest one-year fixed tariff of 2024.1
In this article
How do Ofgem decide what the price cap will be?
What are the current price cap rates?
What do I need to know about the price cap?
What is the Price Cap?
The price cap, introduced by the government in 2019, limits the rates for customers on standard variable energy tariffs. The energy price cap is set by Ofgem every January, April, July and October. It places a maximum amount you'll pay per unit of energy you use, and the daily standing charge that covers the distribution cost of getting gas and electricity to your home.
It doesn't cap your total bill - the more energy you use, the more you'll pay.
How do Ofgem decide what the price cap will be?
Ofgem set the price cap by working out how much it costs energy suppliers to supply you with gas and electricity. These costs cover things like buying wholesale energy, maintaining supply pipes as well as wiring and operating costs.
Energy price cap predictions2
We want to keep you informed, so here's a summary of our latest (July 2024) energy price cap predictions. Please note, this is for guidance only isn’t guaranteed.
Energy prices fell on 1st July
Ofgem announced on 24 May 2024 that energy unit prices will drop which started 1 July 2024. This means, if you’re on a variable tariff, you'll pay less per unit of energy, leading to lower average household bills.
What can affect our energy price cap predictions?
The energy market has been more stable recently, but surprises can happen. Global politics play a big role in energy prices. For example, if conflicts in Ukraine, the Middle East, or Taiwan worsen, wholesale gas prices could go up. This would eventually mean higher bills.
Also, ongoing talks about how the next price cap is calculated and other energy rules could affect prices in 2024, changing these predictions.
We’ll keep these forecasts updated monthly to help you understand if a fixed or variable tariff would be best for you.
| Period | Price cap predictions | Confidence level |
|---|---|---|
| Q3 2024 starts 1 July | £1,568 | Current cap |
| Q4 2024 starts 1 October | £1,716 | Strong prediction |
| Q1 2025 starts 1 January | £1,745 | Best estimate |
| Q2 2025 starts 1 April | £1,759 | Best estimate |
According to the latest predictions, energy prices are expected to rise towards the end of 2024. Right now, fixed tariff deals might look more expensive than the current standard variable tariff price (SVT). But, since fixed tariffs don't change with price caps, you could save money over your contract's term if prices go up as predicted.
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What are the current price cap rates?
Select the payment option below and enter your postcode to find out your local Standard Variable Tariff price cap rates - the table to the right hand side will automatically update.
Direct Debit - July 2024 price cap rates
- Gas standing charge
- 31.413p
- Gas unit rate
- 5.479p
- Electricity standing charge
- 60.098p
- Electricity unit rate
- 22.362p
Pay on Receipt - July 2024 price cap rates
- Gas standing charge
- 35.205p
- Gas unit rate
- 5.766p
- Electricity standing charge
- 65.878p
- Electricity unit rate
- 23.537p
Pay As You Go - July 2024 price cap rates
- Gas standing charge
- 31.404p
- Gas unit rate
- 5.259p
- Electricity standing charge
- 60.087p
- Electricity unit rate
- 21.581p
What do I need to know about the price cap?
The price cap doesn’t apply to fixed tariffs
If you’re on a fixed tariff, the price cap won’t affect you. If you're on a fixed tariff. We won’t increase the price you pay, unless the government increases VAT.
You can see in your account what tariff you’re on.
Send us monthly meter reads for accurate bills
It takes just minutes using your app or online account.
We use your meter readings to create your bills or statements. If we don't receive readings from you, we'll make estimates based on typical energy use, which could result in a higher bill than necessary.
When will my Direct Debit change?
Your Direct Debit amount does not adjust automatically when tariff prices change.
Price cap rates are falling, but we may increase your Direct Debit payments to match the cost of your ongoing average energy use. Also, if your account has a negative balance, we may increase your payments to get your account back to a positive balance.
When will my prepayment meter prices change
Electricity key meters
If you have a meter that you top up with a key at Payzone or Post Office, to get the new prices you need to top up on or after 1st April. Your meter will have the new prices once you've put the key back in your meter.
Pay as you go smart meters
We know that some of our smart meters won't get the new prices no matter how much we try. If we can't fix yours after three months, we'll send you a cheque for anything you've been overcharged.
Smart Energy Monitors
Some Smart Energy Monitors (SEM) won't update with the new prices, so the estimated cost of energy they show will be wrong. Don't worry though, bills and direct debits will be charged on the new prices and we will keep trying to fix your SEM.
What can I do to manage energy costs?
Reduce your usage to save energy and money on bills
The price cap limits the unit rates and standing charges, not your annual energy cost.
Here are some energy-saving steps you can take right away to improve the energy efficiency of your home without spending a penny.
Lock in your energy prices
Our fixed energy tariffs can provide peace of mind that your prices won't increase this winter. Check out all our available tariffs in your online account.
If you're having trouble paying your bills
We don't want people to stop using electricity or heating their homes if you can't afford it. Please let us know if you find yourself needing financial support.
Save money with PeakSave
Earn money off your bills for making small changes to when you use electricity.
Pay less with a Direct Debit
Gas and electricity unit rates are lower if you pay by Direct Debit.
Get smart meters
Easily see how much energy you're using at a glance, which can help you save money.
Legal information
Saving vs price cap is based on dual fuel customers consuming medium energy usage as defined by Ofgem’s new Typical Domestic Consumption Values (TDCV) (2,700 kWh of electricity and 11,500kWh of gas per year), paying by Direct Debit.
Our current prediction is that the price cap will increase for the period between 1st October and 31st December 2024. See our latest predictions for the price cap.
Our current 1-year fixed tariff "Fixed Tariff 12M v8", is the cheapest single-rate dual fuel tariff we’ve offered so far this year. If the price cap falls after December 2024, you could pay more for your energy with a fixed tariff.
Predicted prices based upon Ofgem’s typical domestic consumption values (TDCVs) which are set at 2,700 kWh per year for electricity, and 11,500 kWh per year for gas. Our price cap predictions follow Ofgem’s price cap methodology and we apply our forecasts of other costs to predict future price cap levels. Our prediction will change based on changes in the cost of wholesale energy for future periods.