After months of rising energy bills, there is finally some positive news for consumers, with leading energy market analysts Cornwall Insight forecasting a significant drop in the energy price cap from 1st July 2025. The energy price cap currently stands at £1,849 for the average dual-fuel energy bill. The anticipated fall in the energy price cap is primarily attributed to lower wholesale gas prices observed in recent months. Several factors have contributed to this, including milder weather across Europe reducing heating demand, geopolitical developments such as US tariffs potentially impacting Liquified Natural Gas (LNG) flows, and evolving strategies around gas storage levels in the EU.
The predicted drop will come as a welcome relief for households on standard variable tariffs (SVTs), which are directly governed by the cap. The price cap, set by the energy regulator Ofgem, limits the amount suppliers can charge per unit of gas and electricity (the unit rate) and the fixed daily amount charged for being connected to the network (the standing charge). While the predicted drop is encouraging, the energy market remains highly volatile, driven primarily by fluctuating wholesale energy costs on the global stage. It is worth noting that even if the energy cap falls as predicted, average energy bills will still be considerably higher than they were before the energy crisis began in late 2021.
Energy price cap predictions for July 2025
As well as the latest predictions from Cornwall Insight, three major energy providers now publish regular updates on where they think energy prices will be heading in the coming months. The actual energy price cap is set by the energy regulator Ofgem and is based on a number of factors, including the wholesale price of electricity and gas. Energy providers British Gas, E.ON Next and EDF are able to run this information through their own algorithms to form a prediction on where the energy price cap is likely to be set in the future. We have provided the latest forecasts below.
| Source | Predicted Annual Cost (£) from July 2025 | Predicted Change vs Current Price Cap (£1,849) | % Change vs Current Price Cap | Confidence Level (where stated) | Date of Forecast |
| Cornwall Insight | £1,683 | -£166 | -8.98% | N/A | 24 April 2025 |
| British Gas | £1,692 | -£157 | -8.49% | Medium | 28 April 2025 |
| E.ON Next | £1,739 | -£110 | -5.95% | Low | 22 April 2025 |
| EDF | £1,697 | -£152 | -8.96% | N/A | 28 April 2025 |
Energy price cap predictions for October 2025
Major energy suppliers now provide energy price cap forecasts that stretch as far as the summer of 2026. Current long-range forecasts from major suppliers suggest relative stability or minor fluctuations after the July drop, but with a high degree of caution. The low confidence ratings attached to these predictions underscore the ongoing volatility in global energy markets. Geopolitical tensions, unexpected weather patterns, or changes in global supply and demand can rapidly alter wholesale prices, making long-term forecasting extremely challenging
| Source | Predicted Annual Cost (£) from October 2025 | Confidence Level (where stated) | Date of Forecast |
| British Gas | £1,657 | Low | 28 April 2025 |
| E.ON Next | £1,700 | Very Low | 22 April 2025 |
| EDF | £1,660 | N/A | 28 April 2025 |
Is now the time to fix your energy tariff?
The prediction of a falling energy price cap complicates the decision of whether now is the right time to fix your energy tariff. When prices were consistently rising, fixing offered protection against further increases, but with the prospect of lower variable rates from July, the decision isn't as straightforward. Ultimately, there is no single right answer. The best course of action depends on individual circumstances, usage patterns, and tolerance for risk. It is crucial to weigh the pros and cons carefully before making a decision.
What are the pros of fixing your energy tariff now?
Fixing your energy tariff now provides clarity on what you will pay and may help you to budget more effectively. Locking in your unit rates and standing charges for 12, 18, or even 24 months protects you from the market volatility that causes the price cap to fluctuate in the future. Additionally, some fixed-rate tariffs are priced below the level that the energy price cap is predicted to fall to in July. It means that fixing now could lead to immediate savings compared to staying on the current standard variable tariff, as well as offering protection against any future price cap rises. You can compare the latest energy deals below. You can also check out our article 'What is the cheapest fixed-price energy tariff?'.
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What are the cons of fixing your energy tariff now?
The main risk of fixing now is missing out on further price reductions. If the energy price cap drops more than predicted in July, or continues to fall in subsequent reviews in October 2025 and January 2026 (although forecasts suggest this is less likely), those locked into a fixed deal could find themselves paying more than necessary or facing an exit fee to change their tariff.
Most fixed tariffs come with early exit fees that can be as much as £150 per fuel. These extra costs reduce flexibility if your circumstances change or if significantly cheaper deals emerge later. Some suppliers, such as British Gas, will often waive exit fees if you decide to switch to another of their fixed tariffs, while others offer fixed deals with no early exit fees.
What if you can't afford to pay your energy bill?
Even with energy bills predicted to fall in July, typical bills remain around £400 higher than they were in October 2021. If you find yourself struggling to pay your energy bills there are a number of things you can do:
- Contact your energy supplier - Notifying your energy supplier that you are struggling to pay your energy bills means that they are obliged to help you find an affordable way for you to repay them.
- Check for grants and schemes - Contact your energy supplier and ask if you are eligible for any of their grants or schemes on offer.
- Pay your bills via your benefits - If you receive certain benefits, such as Universal Credit or Income Support, you may be able to come to an agreement with your supplier for your debts to be repaid directly from your benefits.
Check out the full article 'What to do if you're struggling to pay your energy bills' for more information.
Help if you're struggling to pay your energy bill
You may be able to clear your debt with your energy supplier via the Fuel Direct Scheme if you receive benefits. Alternatively, you may be able to get help with grants and schemes offered by your energy supplier or with the British Gas Energy Trust, which offers support for customers of all energy companies. For more information on the schemes available visit the Citizen's Advice website.
Finally, there are a number of charities and organisations that can provide free financial advice. We've provided links to a selection of the best websites below:
- MoneyHelper (previously the Money Advice Service)
- The money charity
- StepChange
- National Debtline
- Turn2us
- Citizens Advice
- Payplan
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