Key Facts
• On August 27, 2025, Ofgem announced a 2% energy price cap increase.
• The new annual cap for average electricity and gas usage is £1,755 ($2,370.83).
• This represents a £35 increase from the July-September 2025 cap.
• The rise is attributed to higher network and policy costs, according to Ofgem.
• Despite a decline from 2023 peaks, energy prices remain 50% higher than summer 2021 levels.
• The UK government plans to expand heating cost discounts to 2.7 million more households this winter.
• The scheme, introduced in 2011, will provide £150 in energy bill support to 6 million low-income households.
• Ofgem states this expansion will add an average of £1.42 per month to all bills.
• Consumer groups urge stronger support for struggling households as energy costs remain unaffordable for many.
Summary
Millions of UK households will face higher energy bills starting October 2025, as the energy regulator Ofgem raises the price cap by 2%. The new annual cap for average electricity and gas usage is set at £1,755 ($2,370.83), marking a £35 increase from the previous quarter. This adjustment is driven by rising network and policy costs, despite a general decline in energy prices since their 2023 peak. However, prices remain significantly higher than pre-crisis levels in 2021. To alleviate the burden, the UK government will extend heating cost discounts to 2.7 million additional households this winter, providing £150 in support to 6 million low-income households. This expansion will slightly increase all bills by an average of £1.42 per month. Consumer groups continue to call for enhanced measures to support those struggling with high energy costs.
