Gas and electricity prices during the 'energy crisis' and beyond
Energy prices have fallen since summer 2023, but are still well above pre-'energy crisis' levels and there is little prospect of large cuts to bills in the near future.
Impact of the conflict in the Middle East
Conflict in the Middle East has led to disruption in energy supplies and resulted in higher gas and electricity prices on the wholesale market. The energy price cap fell in April 2026, as it was based on wholesale prices up to mid-February 2026 and took account of the government's decision to remove some policy costs from bills. The cap for July to September 2026 is the first to be affected by these increased wholesale prices and unit prices for gas and electricity will increase by 28% and 6% respectively.
Cornwall Insight publishes its latest forecast of the price cap on its Predictions & Insights into the Default Tariff Cap (Price Cap) page.
This page is a short summary of the full PDF report Gas and electricity prices during the 'energy crisis' and beyond.
Domestic gas and electricity prices increased rapidly during the 'energy crisis' of late 2021 to early 2023. Average annual bills for typical levels of dual fuel consumption rose by 54% in the April 2022 price cap, and by a further 27% in the October 2022 cap. They would have increased by a greater amount without government intervention.
Energy prices have fallen back from the highs they reached during the energy crisis, but not returned to pre-crisis levels. The upcoming increase in the July 2026 cap will mean bills for typical levels of consumption will be 53% above their winter 2021/22 level.
The 'energy crisis'Global prices for gas, electricity, oil and other fuels started to increase from summer 2021 when economies began opening up after pandemic related-lockdowns. This underlying increase was magnified by reduced supply of fuels from some producers and increased tensions between Russia and Ukraine.
Prices increased further in late 2021/early 2022 and spiked after Russia launched a full-scale invasion of Ukraine on 24 February 2022.
Source: nationalgrid.com Prevailing View tool (system average price)
The first major impact on domestic customers in Great Britain (those on standard variable tariffs and hence covered by the energy price cap) was a 54% increase in the price cap in April 2022.
Wholesale prices for gas and electricity reached new record highs in the UK, Europe and elsewhere during this ‘energy crisis’ and have still not returned to their earlier levels.
The crisis led to an unprecedented response from governments across Europe. In the short term this was mainly to support consumers facing much higher prices and, for some, to move away from Russian fossil fuels. Medium to longer term policies in the EU and UK aim to reduce dependence on imported fossil fuels more generally.
The record prices in 2022 would have led to an 80% increase in the energy price cap in Great Britain without intervention from government. The Energy Price Guarantee (EPG) limited the increase to 27% in October 2022 and meant that domestic consumers paid less than they would have under the price cap until July 2023.
Source: Ofgem, Energy price cap (default tariff) levels: 1 July 2026 to 30 September 2026 (Final levelised cap rates model (Annex 9)), 27 May 2026
What are current energy prices?
Under the April to June 2026 direct debit price cap the average annual bill for typical gas and electricity consumption is £1,641. This is well below the peak level of £2,380 under the Energy Price Guarantee from October 2022 to June 2023, but still 35% higher than in Winter 2021/22.
The price cap will increase by 13% in the third quarter of 2026 and is currently forecast to increase by a further 2% in the fourth quarter of 2026.
Under the current direct debit cap the average price of gas is 5.7 pence per kilowatt hour (p/kWh), the average price of electricity is 24.7 p/kWh. Average standing charges are 29.1 p/day for gas and 57.2 p/day for electricity.
The average price of gas under the direct debit cap will increase to 7.3 p/kWh in July 2026, the average price of electricity will increase to 26.1 p/kWh. Average standing charges under this cap will remain broadly similar to their current level.
Source: Ofgem, Energy price cap (default tariff) levels: 1 July 2026 to 30 September 2026 (Final levelised cap rates model (Annex 9)), 27 May 2026
How do energy prices in the UK compare to those in the EU?
UK domestic gas prices in the first half of 2025 were below those in 17 EU countries. UK electricity prices were higher than in all but one EU state (Germany). Electricity prices in the UK have gradually become more expensive than in most other EU countries. In the early 2000s domestic electricity prices were the second lowest in the (then) EU 15.
Gas prices in the UK were 28% below the EU average and electricity prices 23% above the EU average in the first half of 2025. The ratio of electricity to gas unit prices in the UK was higher than in any EU country at the time.
UK consumer prices for gas and electricity increased at a much faster rate than the EU average in 2022. Price falls in the UK in 2023 happened later than in most of the rest of Europe.
For more detail on international price comparisons of household energy prices see section 7 of the Library briefing Domestic energy prices.
What was the Energy Price Guarantee?Following concerns over the effect of a proposed 80% increase in the energy price cap, then Prime Minister Liz Truss announced that the Energy Price Guarantee (EPG) would be introduced from 1 October 2022 and last two years. This was the government’s main measure to reduce the impact of the ‘energy crisis’ on consumers.
The EPG’s aim was to reduce the extent of price increases for domestic customers. Under the scheme, the government set maximum prices for gas and electricity which were below those under the existing price cap. The government compensated energy suppliers for selling at below cap prices.
Maximum energy prices for customers on standard variable tariffs were set by the lower of the EPG or the energy price cap. The EPG was lower during the period October 2022 to June 2023, so set maximum prices during this time.
The falls in the price cap since in July 2023 meant the EPG was not needed again and it ended in March 2024.
Annual bills for ‘typical’ consumption levelsThe EPG and price cap are normally expressed as an annual figure. This is the annual bill that dual fuel (gas and electricity) direct debit customers with typical consumption levels would face if these prices remained constant across a year. Annual bills are not capped. Households that use more energy will pay more, those which use less will pay less.
Prices vary by region and are higher for customers paying by quarterly bills.
Prices in 2023 and early 2024Wholesale energy prices fell in late 2022 but there was a substantial lag before these fed through to consumers. The reduction in the price cap in April 2023 was not large enough to take it below the EPG level, so customers did not see their bills fall until the cap fall at the time.
The price cap (for typical consumption) for July to September 2023 was £1,976. Unit prices were 27% lower than under the EPG for gas and 9% lower for electricity. As its annual level was lower than the EPG, customers on standard variable tariffs saw prices fall for the first time since October 2020.
The cap fell further to £1,834 in October 2023. It increased to £1,928 in the first quarter of 2024. As these levels were below the EPG, this mechanism was not needed to set maximum prices again before it ended in March 2024.
The April to June 2024 cap fell to £1,690 for customers with typical consumption levels. Average unit prices for gas and electricity both fell by 9%. Average standing charges increased by 13% for electricity and 6% for gas.
Price changes from April 2024The overall price cap for typical levels of dual fuel consumption has varied from around £1,570 in July to September 2024 to around £1,850 in April to June 2025. They are £1,641 under the current cap. Unit prices for gas have fallen by 5% between the start and end of this period, unit electricity prices have increased by 1%. Standing charges increased steadily to early 2025 before falling in the second and third quarters of 2025, increasing at the end of 2025/beginning of 2026 and falling again in April 2026.
Prospects for pricesWholesale gas prices doubled in early March 2026 in response to the start of the Middle East conflict. They have fallen back from these recent highs, but are still volatile and remain clearly above their levels from much of 2025. This recent increase in prices will not feed through to the price cap until July 2026. The earlier fall in the cap in April 2026 was largely due to reductions in policy costs. Unit prices for gas and electricity will increase in July 2026 by 28% and 6% respectively. Standing charges will remain broadly stable.
Despite the fall in prices in late 2023, much of 2024 and April 2026, typical bills under the July to September 2026 price cap will still be 53% higher than in winter 2021/22.
The cap is currently forecast to increase by 2% in the final quarter of 2026. Forecasts of the price cap are uncertain so there is no guarantee that prices fall at this time.
With little immediate prospect of savings from fixed tariffs or substantial further cuts in the price cap, the only way to substantially reduce energy bills, while still adequately heating and powering homes, is to improve the energy efficiency of properties.
Customers in Northern IrelandEnergy prices in Northern Ireland are not controlled by the price cap and only a minority of households use mains gas for heating. The government provided support for customers in Northern Ireland which was said to be equivalent to the EPG. This resulted in the largest electricity supplier in Northern Ireland cutting prices in November 2022 to below those in the rest of the UK. However, reduction in this support from April 2023, and its ending from July 2023, led to price rises in Northern Ireland in 2023. Since October 2023 the cheapest prices from Northern Ireland’s largest supplier have been higher than prices under the cap in the rest of the UK.
Since October 2023 the cheapest prices from Northern Ireland’s largest supplier have been higher than prices under the cap in the rest of the UK.
Revised Typical Domestic Consumption ValuesOfgem introduced new lower Typical Domestic Consumption Values (TDCVs) for all its relevant publications from October 2023. This reduced the assumed typical level of annual gas consumption from 12,000 kWh per household to 11,500 kWh and typical electricity consumption from 2,900 kWh to 2,700kWh.
Ofgem will reduce these TDCV levels again in July 2026, reflecting further falls in median average household consumption. The assumed level for gas will be reduced by 17% to 9,500 kWh, the level for electricity will be reduced by 7% to 2,500 kWh.
This change makes an average bill for typical consumption look lower, even if prices per unit of energy are unchanged. However, it does not affect trends in prices or bills.
Most statistics included in this briefing use the current (October 2023 to June 2026) TDCVs. Future versions of this briefing will use the new lower TDCVs. Unit prices are also included as these are not affected by assumptions about TDCVs.
Local area dataThe tables at the end of the full PDF report give breakdowns of the current and upcoming price caps by energy supply region and payment method. A separate price cap is set for each of the 14 regions and applies throughout the region. This means there is no further geographical breakdown of prices or typical bills below regional level.
Further informationThe Library briefing What costs make up an electricity bill? Looks in detail at the different cost components of these bills, what they are, how they have changed in the past and how they might alter in the future.
The briefing Domestic Energy Prices includes more analysis of the causes of recent prices rises, historical data and information on prices of other domestic fuels. Households off the gas-grid and prices for alternative fuels looks at prices of fuels for households that do not use mains gas for heating and compares changes in their prices to those for mains gas.
Energy standing charges looks in more detail at these costs, how they have changed over time, what they consist of and proposals for change.
The briefing Energy efficiency of UK homes presents data on energy efficiency levels across the nations of the UK, variations by different types of properties and households, insulation measures and government funded/mandated energy efficiency schemes.
Introduction to the domestic energy market explains key concepts in the domestic energy market and looks at how the market is structured, how bills are calculated and the challenges facing energy supply. The insight Why is cheap renewable electricity so expensive? Looks at how prices are set on the wholesale market.
The briefing Constituency casework: Government support for energy bills includes answers to frequently asked questions about government help with energy bills. Help with energy efficiency, heating and renewable energy in homes includes information on financial support available to install these measures.
The data dashboard Local area data: fuel poverty gives fuel poverty statistics for constituencies in England and local authorities in Scotland, Wales and Northern Ireland. Constituency data: Households off the gas grid shows patterns of connection to the gas grid for constituencies in Great Britain. Constituency data: Energy efficiency includes data on energy efficiency measures and ratings.
Ofgem's latest assessment of the state of the retail energy market looks at data on prices, suppliers/resilience and quality/standards.