Price cap for average dual fuel Direct Debit households increased to £1,849

The energy price cap for an average household paying by Direct Debit for dual fuel rose to £1,849 a year in April 2025, Ofgem's state of the energy market report confirms, primarily because of higher wholesale energy costs¹. The increase is 6.4 per cent, or £111, on the previous level, and is the third rise in a row³. The cap sets the maximum a supplier can charge for a unit of energy and standing charge on a default, variable tariff, so it governs what households pay when they have not switched to a fixed deal.

The cap level differs by how a household pays. Ofgem gives £1,849 for Direct Debit customers, £1,803 for prepayment meter customers and £1,969 for standard credit customers². Ofgem attributes the rise mainly to volatile international wholesale markets, with policy costs up by £11, driven by increases in the Renewable Obligation and Green Gas Levy and the introduction of a new Network Charge Compensation scheme allowance². For a typical dual fuel Direct Debit household between April and June 2025, Ofgem's bill breakdown is 45 per cent wholesale costs, 20 per cent network costs, 13 per cent operating costs, 11 per cent policy costs, 6 per cent other costs and 5 per cent VAT².

"The current price cap for average households on dual fuel Direct Debit increased to £1,849 in April 2025 due to higher wholesale costs."

The rise lands on top of record consumer debt. Ofgem puts consumer debt and arrears at a record high of £3.85 billion in quarter 4 2024¹. Consumer Scotland says energy debt and arrears in the GB domestic market now exceed £3.8bn, also a record high, and that its earlier Energy Affordability Tracker showed 9 per cent of consumers reported being in energy debt⁴. National Energy Action notes the cap is now only £120 below the £1,971 level of May 2022, when households also received £400 of energy bill support⁵. It adds that under the previous typical domestic consumption value the April 2025 cap would have been £1,938 a year, less than £40 off May 2022, because Ofgem lowered the consumption figure used for the headline in May 2023⁵.

On the market around the cap, Ofgem reports 23 active domestic suppliers and 72 business suppliers, with the six largest holding 91 per cent of the domestic market; Octopus is now the largest electricity supplier and second largest gas supplier in Great Britain¹. The number of available tariffs has risen, and as of February 2025 the gap between the cheapest tariffs and the cap was around £140². Switching is rising but remains below pre-crisis levels¹. Rebel Energy exited the market in April 2025, affecting some 90,000 customers². Smart time of use tariff adoption rose by over 75 per cent in the past year, and smart meters are in 65 per cent of homes, with around 90 per cent operating in smart mode¹.

Why it matters for households

The cap is not a ceiling on a household's bill; it caps unit rates and standing charges, so a home that uses more than the typical 2,700kWh of electricity and 11,500kWh of gas a year pays more than £1,849². A home that uses less pays less. That distinction matters for what the price cap typical household figure actually means, and for reading the price cap rates by payment method, since prepayment and standard credit carry different levels². For energy independence, the levers a household controls are its own consumption and its tariff choice, not the cap level itself. Ofgem's own figures show the gap between the cheapest available tariffs and the cap was around £140 in February 2025, and that the share of customers on fixed-term contracts more than doubled from 11 per cent to 27 per cent after fixed deals returned in the second half of 2023². The price cap history shows how the level has moved since 2019, and UK domestic energy prices over time sets the current level against earlier periods.

What happens next

Ofgem says it aims to publish the state of the market report every six months¹. Uswitch reports that prices are due to drop slightly in the summer, but states this is not a guarantee and that the wholesale market remains unpredictable³. National Energy Action says no energy bill support is in place until later this winter⁵. The next cap level, and the date of its announcement, have not been reported in these sources.

Sources5 cited

1. State of the energy market report: retail | Ofgem, ofgem.gov.uk
2. Ofgem State of the market report, ofgem.gov.uk
3. Energy price cap to increase by 6.4% to £1,849 - Uswitch, uswitch.com
4. Consumers facing further rise in energy costs after price cap increase | Consumer Scotland, consumer.scot
5. Energy bills rise to crisis levels - National Energy Action (NEA), nea.org.uk