About energy price caps

Mae’r dudalen yma ar gael yn Gymraeg.

Energy price caps are here to ensure you pay a fairer price for your energy and to protect against overcharging.

Are all energy tariffs price capped?

No. The price of your tariff is capped if:

Energy price caps limit the price a supplier can charge you per kWH of electricity and gas (this is the unit measure which your bill is calculated from), not your total bill which will vary depending on how much energy you use. 

If you are on a fixed-term energy tariffopen key term pop-up you have chosen, your prices will not be protected by the caps. These tariffs are more likely to be good value. 

How do energy price caps work?

You could be protected by:

  • a ‘prepayment’ price cap (sometimes called a ‘safeguard tariff’). This applies if you use a prepayment meter to pay for your energy. It lasts until 2020.
  • a ‘default tariff’ price cap. This applies if you are on a ‘standard variable’ energy tariff or a tariff you haven’t chosen (a ‘default’ tariff). It started on 1 January 2019.

If you get the government’s Warm Home Discount and are on a  'default' or 'standard variableopen key term pop-up energy tariff, you were protected by the prepayment price cap until the end of 2018, after which you transferred to the ‘default tariff’ price cap.

View the current price cap levels

Will my bills fall?

Yes, if you’re on a poor value deal. Suppliers must cut their prices to the level or below the caps we set. So if you’re on one of the tariffs currently priced above the cap, you will save money. 

If costs to supply your energy fall, the cap makes sure suppliers pass on savings. If these costs rise, then you can have peace of mind that the caps ensure price rises are justified, and not the result of supplier profiteering. 

Price caps won’t limit your total bill. This will vary depending on how much energy you use.

Your capped tariff under a price cap will depend on many things: how you pay (direct debit or standard creditopen key term pop-up), where you live and what type of meteropen key term pop-up you have. There are regional differences in the caps to reflect how much it costs to transport energy across the energy network to where you live.  

Why have price caps been introduced?

The energy market is not working for all consumers and those who have not switched tariff or energy supplieropen key term pop-up are losing out. More than half of UK households have never switched or have only switched once, and are on more expensive ‘default’ and ‘standard variable’ tariffs as a result. 

Ofgem and the UK government have introduced price caps so if you are less active in the market you don’t get left behind or pay an unfair price for your energy. We’re also working to introduce broader reforms, like faster switching times and smart metersopen key term pop-up, to make sure everyone gets a fair deal at all times.  

It’s Ofgem’s role – as the energy regulator we’ve been given special duties by the UK government – to set the levels of the price caps. We do this twice a year. Our calculations reflect a broad estimate of how much it costs an efficient supplier to provide gas and/or electricity services to you if you use a prepayment meter or are on a basic 'default' or 'standard variable' energy tariff.

What next?

You don’t need to do anything to be price protected – your supplier must apply the caps. They can tell you if your energy tariff is covered by a price cap. They must also write to tell you if your tariff is changed in a way that could disadvantage you, or if the tariff you are on is no longer available.

Even if you are covered, you should still shop around to see if you can save more money by switching to a different tariff or supplier. It is likely there will be offers which could save you even more money on your gas and electricity than staying on an energy tariff covered by the price caps. 

How to switch & save on your gas and electricity now

Your questions answered: FAQs

Who to contact? Finding your supplier details

Warm Home Discount

The Warm Home Discount (WHD) is a government scheme aimed at tackling fuel poverty in Great Britain. Under the scheme, larger energy suppliers support people who are in fuel poverty or are at risk of it. More.

Standard variable tariff

A basic tariff with variable prices that can go up and down with the market. You could be put on a standard variable tariff or a tariff you have not chosen (a ‘default tariff’) if your fixed-term tariff contract ends and you have not chosen a new one. They usually cost more than a fixed-term tariff. More.

Default tariff

If you’ve never switched energy supplier or have switched only once, you’re likely to be on a poor value, more expensive ‘default’ tariff. Default tariffs, including standard variable tariffs, are a basic tariff from an energy supplier. More.

Fixed-term tariff

A tariff with specific terms applying to the contract conditions. Usually these lock-in a price for a year or more, amongst other services. More.

Default tariff

If you’ve never switched energy supplier or have switched only once, you’re likely to be on a poor value, more expensive ‘default’ tariff. Default tariffs, including standard variable tariffs, are a basic tariff from an energy supplier. More.

Standard credit

When you arrange payment on receipt of a bill (e.g. each month or once a quarter), rather than paying automatically by Direct Debit or prepayment. More.

Energy meter

The device used to record how much gas and/or electricity is used. More.

Switch or switching

The process of moving from one energy supplier to another, or to another tariff with the same supplier. More.

Smart meter

The next generation of energy meters with real-time data to help consumers control how we buy and use energy. More.