With the price cap set to reduce from July, we look at energy costs for the summer and what you might expect for the autumn time.
Government regulator Ofgem sets the energy price cap every three months, and back in April, it saw a 6.4% increase. However, it is estimated to drop back down by 7% in July, though the exact figures will vary depending on the payment method.
Here we’ll discuss current energy costs, the price estimates for July through September, and what the price cap may be adjusted to for the October-December period.
What Do The Energy Price Changes Mean For Your Pocket?
With the price cap increasing by 6.4% on April 1st (as compared to the three months prior), this represented a rise in average annual energy bills for a typical household paying by direct debit of £1,738 to £1,849.
In the immediate, this meant monthly bills increasing from £145 to £155 per month if you pay by direct debit, with similar cost increases for other payment methods, calculated at around a 6% increase in monthly bills.
As discussed, monthly bills are expected to decrease by around 7% from July 1st, with this essentially canceling out the increase seen earlier in the year.
Monthly bills for households paying by direct debit are due to land at around £143 per month from the first of July, close to levels seen at the start of the year.
Estimated Energy Costs For July-September
As you might conclude, these price variations fall somewhere between everything adds up when money is tight but the changes in prices may not be as dramatic as some headlines suggest.
To be more specific, here’s what the July 2025 estimates mean in practice for different households, with these estimates based on Ofgem data for the typical household:
| Payment Method | Avg. Monthly Bills for April-June | New Avg. Monthly Bills for July-Sept | Reduction In Price Cap |
| Direct Debit* | £155 per month | £143 per month | £12 per month |
| Prepayment Meter | £150 per month | £139 per month | £11 per month |
| Standard Credit | £164 per month | £155 per month | £9 per month |
| Economy 7 (Direct Debit) – Electricity Only | £100 per month | £95 per month | £5 per month |
*Direct debit payment is the most common payment method for heating bills in the UK, which, according to Nesta, accounts for around 7 in 10 UK households.
What Else You Should Know
The previous increases seen in April have/are resulting in an increase of close to £10 per month for most customers as compared to January-March, an accumulative total of £30 per month over the three months. However, with prices coming back down, that will be the extent of April’s increase, at least until any future price increases in the future.
It should also be noted that Economy 7 direct debit customers as opposed to regular direct debit customers saw their bills increase by only about half as much as most energy consumers. And likewise, they will see a reduction by a similar amount in July, about a £5 decrease in bills per month.
Why The Price Cap Has Varied This Year
Ofgem adjusts the price cap, in general, to consider how wholesale energy costs are changing, thus keeping this in mind when capping what suppliers can charge in a given season, though numerous factors can, directly and indirectly, affect wholesale costs.
This year, the price cap initially went up in April due to supply constraints and, to an extent, governmental schemes.
Reliance on natural gas, while decreasing, remains a factor in price volatility too, however, the UK surpassed 50% renewable electricity generation in 2024 with the government eyeing increased self-reliance to reduce price volatility over time.
Efforts by government and local authorities can have positive and negative effects on the price cap which highlights the importance of careful management of schemes and developments that aim to stabilise energy prices over time.
As for July, some of the key factors in the price cap reduction include wholesale gas prices declining and lowering supplier operating costs.
The summer is also generally associated with lower energy bills, regardless, due to seasonal demand variations.
In fact, the price cap fell by a similar 7.2% last July, though additional factors should not be overlooked, especially as you’ll see shortly that the October price cap estimate (while speculative) suggests the Summer reduction sustaining through the autumn time.
Either way, this is another sign that the price cap is lowering as it is for reasons other than seasonal price variations as a sole explanation.
Energy Cost Forecasts for October And Beyond
Following the price cap adjustment on July 1st, the next price cap period will apply for October through December with the October price cap due to be announced on August 27th.
Cornwall Insights predicts that the monthly price cap will go up very slightly to £144 per month in October, virtually unchanged in general from July. This would represent a change of less than 1%.
Of course, it’s early days and predictions are always far from secure nowadays given international instability as relates to energy and the global economy.
While the energy crisis was more severe earlier in the decade, price volatility and the risk of volatility remain in the current geopolitical environment.
Prices will likely fluctuate in 2026, particularly if 2025 price variations are anything to go by in terms of fluctuation levels.
That said, there are positive indicators to suggest that bills may decline more consistently in the late 2020s and into the 2030s, possibly bringing an end to at least a given phase of the energy crisis.
Key reasons that prices may become less and less volatile over several years and beyond include increasing energy self-reliance, the growth in exportable renewable energy across the continent and the prospect of at least reduced conflict in Ukraine with some degree of geopolitical stabilisation in the region, at least relatively speaking.
Of course, there are many question marks over the above scenarios, though growing energy self-reliance at home is arguably the most likely factor to prove secure in reducing domestic energy prices and stabilising price volatility as reflected in Ofgem’s price cap.