Energy prices: what’s happening and what you need to know

Energy costs are set for a brief dip before rising again later in the year, according to new forecasts from energy analysts, Cornwall Insight.

Energy prices this winter

From January, the Ofgem price cap for a typical dual-fuel household is expected to fall by around 1%, dropping to about £1,733 a year, roughly £22 less than today.

This small reduction is driven mainly by lower wholesale gas prices.

What is the price cap?

The price cap limits what suppliers can charge per unit of energy and for the standing charge if you’re on a standard variable tariff.

Currently, between 1 October and 31 December 2025, the cap stands at £1,755, which is a 2% increase on the previous quarter’s £1,720.

But costs could rise again

The relief won’t last long. Cornwall Insight expects the cap to rise again by around £75 in April, partly due to the cost of expanding and upgrading the UK’s gas and electricity networks.

This forecast comes ahead of the chancellor’s autumn budget on 26 November.

Reports suggest Rachel Reeves may scrap the 5% VAT on energy bills, something that could reduce typical annual bills by about £80.

The next official price cap announcement is due on 25 November 2025, and will set energy prices for 1 January to 31 March 2026.

What to do if you’re struggling with your energy bills

If you’re finding it hard to keep up with your bills, contact your supplier. 

They might be able to offer:

• grants
• payment plans
• advice on managing your account
• emergency credit if you’re on a prepayment meter

It could also be worth joining the Priority Services Register for extra support.

Another good idea is seeing where you can cut your energy usage to save money.

Have a read of our 50 smart energy-saving tips for some ideas on where to get started.