Average Cost of Electricity per kWh in the UK (2024)

According to OFGEM, the average electricity bill in the UK as determined by the energy price cap will be £1,568 per year for the typical household from 1 July, but this does not mean your energy bills are capped at £1,568! The cap is not actually a cap on the total figure one pays—the cap is per kWh (unit cost). So the £1,568 'cap' refers only to households with typical usage. Those using more energy will pay more than £1,568 per year. (And those using less energy will pay less than £1,568.)

What does this price cap mean on a per kWh basis? The new price cap was just announced for Q3 2024—the great news is that prices are coming down, at least a bit! For the three months from 1 July - 30 September 2024, the per unit direct debit costs will be capped at 22.36p/kWh for electricity and 5.48p/kWh for gas, inclusive of VAT—and standing rates hold steady at 60.1p/day for electricity and 31.4p/day for gas. This all means that the per kWh cost for electricity will drop 8.7% from July.

But these per unit/per day rates actually vary by region, as we explain below.

In this article

• Current electricity prices UK
• Comparing Current Energy Deals by Company
• NEW Custom Energy Report. Ever wonder how your energy bills compare to your neighbour's?
• Current and Historical Energy Prices in the UK
• Unit Cost of Electricity per kWh, by UK Region
• Future Electricity Prices

This article will explain what we know about current unit costs for electricity in the rapidly changing market. We'll also discuss historical electricity cost data so you can see just how much prices have risen, as well as see differences by region, household consumption and depending on how you pay: credit, direct debit or prepayment.

Electricity prices UK

The current price of electricity in the UK is going to be 24.5p/kWh (variable cost) plus 60.1p/day (daily standing charge). These figures reflect the current Energy Price Cap (EPC) that runs from 1 July 2024 through 30 September 2024.

Gas prices UK

The price of gas in the UK will be 5.48p/kWh (variable cost) plus 31.41p/day (daily standing charge). These figures reflect the current Energy Price Cap (EPC) that runs from 1 July 2024 through 30 September 2024.

Comparing Energy Costs by Company

Is it time to switch energy? The Q3 price cap of £1,568 is a two-year low for energy prices. It's worth assessing your options if you're on a standard variable tariff. Run an energy comparison to see fixed energy deals that are currently available.

Most companies currently charge very similar unit costs and standing charges right now—these tariffs are essentially the same because they're based on the EPC (£1,568 from 1 July to 30 September 2024). So does it make any sense to switch—is there any way to save?

Possibly—for two reasons.

Firstly, the majority of households are now on a variable tariff. If prices rise heading into autumn and winter 2024, then those on a variable tariff will pay more—leading to rising energy bills.

Secondly, locking in a fixed tariff can reduce the stress of uncertainty. By switching to a fixed tariff, you know exactly how much you'll pay (per kWh) for the next year. Fixed tariffs are now coming back into the market, with So Energy, British Gas, EDF and more recently offering fixed tariffs at rates cheaper than the EPC.

Depending on details like your location and usage, you will get a different offer, of course. The point is, there are fixed tariffs that can help you so you know exactly how much you'll pay per day and per kWh for the next year. It provides that security. But, and this is a big but, you might pay more for your energy use right now for the security of locking in your rate.

We compared tariffs with Uswitch for our local area and found two companies offering a fixed rate not far from current variable tariffs:

For reference and comparison, we've included the July EPC in the table above.

What do we think—are these good deals?

The So Energy deal looks a bit more expensive than the July - September EPC (other than the electricity standing charge), however, it does lock in a rate to protect against rising prices over the winter.

The Utility Warehouse fixed tariff is a bit more to take in. As you can see, the Utility Warehouse daily standing charge for electricity seems quite cheap (7.115p/day compared to the 60.12p/day July EPC). This alone could save you £193 per year in standing charges, calculated/estimated as 365 days x (60.12 p/day - 7.115p/day). However, the variable cost for electricity on this tariff is higher than the current EPC (27.997p/kWh compared to 24.5 now and 22.36 in July - September)—this would cost you more over the next few months, and potentially over the course of a year, unless variable prices rise from September. The amount this would cost you extra depends on usage as well as future variable electricity prices. For example, a household using 3,200kWh of electricity per year would spend an extra £180 per year paying 27.997p/kWh compared to paying 22.36p/kWh (the July - September price cap). But prices may rise in the autumn/winter. In short, for this example, you save on standing charges but potentially spend extra on variable charges—whether or not this type of deal is right for you depends on your usage, your views of energy prices, etc. Don't forget the exit fee for fixed tariffs, should you want to change in the next year (£50/fuel with SO Energy and £75/fuel for UW).

Of course, of rates continue to drop, then you could pay more over the next year on a fixed tariff compared to a variable tariff...

Ever wonder how your energy bills compare to your neighbours'?

Get Your Personal Energy Report here! (See what it looks like here.)

Our energy calculator compares your gas and electricity bills to other households in your postcode. It also highlights ways you specifically could save money—e.g. perhaps your standing charge is higher than your neighbors are paying, so you could compare plans with more competitive standing charges.

Using official data, your customised report breaks down the average usage, price and standing charges where you live, and shows whether you're paying above or below the odds. All you need to do is enter a few details found on your utility bill and we'll do the rest. Get started below.

Unit Cost of Electricity per kWh, by UK Region

Did you know that electricity prices vary by region? The table below displays unit prices by UK area, with figures for 2021, 2022 and estimates by area since then for 2023 and 2024 according to the EPG and EPC.

Please note, these regional price estimates (based on EPC/EPG) are without VAT, which is charged at 5%. If you want the price including VAT for your area, multiply by 1.05. Prices reflect direct debit payment options.

1 July 2024 Unit and Standing Gas & Electric Costs (by region)

Below, we've consolidated the figures for gas and electric—both variable per kWh costs and daily standing charges—by region. The figures exclude VAT (charged at 5%) and are for a standard, single meter on direct debit for payments. Beware that rates will vary by payment method and meter (e.g. direct debit is typically cheapest historically; now prepayment meters match direct debit standing charges). For example, gas standing rates including VAT for Q3 2024 are on average 31.4p/day for direct debit and for prepayment meters, but 35.2p/day for standard credit.

Please note that these figures are a rough estimate; please use for educational purposes only as a guide—the actual per kWh charges will differ.

If you want to see how much your monthly or annual energy bills might be, check out our new energy cost calculator—you can adjust the usage and per unit costs to customise for you, or see how different per unit prices will affect your bills.

Current and Historical Energy Prices in the UK

From 1 July 2024, default energy tariffs for those paying by direct direct will cost £0.2236 per kWh on average across the UK for electricity. This is a drop of 34% from the high of £0.34/kWh back in 1 October 2022 - 30 March 2023.

Gas prices rose to 10p/kWh last year, but will be down nearly 50% to 5.48p/kWh from 1 July 2024.

While it's hard to miss the recent energy price explosion of the past few years, in fact, energy prices have been rising for a few years even before that. For example, average unit costs had already risen a remarkable 67% from 2017 to 2021. This historical average unit cost data is based on total bills as produced by the Department for Business, Energy & Industrial Strategy. We've used these figures which are based on fixed consumption rates to look at how unit electricity prices have changed over time, but since they are based on a fixed consumption rate you'll notice they differ from the figures shown in the region-by-region analysis.

These historical figures represent the average across all payment methods.

^The actual figures for 2023 will differ and can only be known after the time has passed; the estimate is for a direct debit payment method based on the EPC.

NEW POLL: How are recent energy price rises affecting you?

Please tell us how you're being affected by rising energy prices. Are you turning down the thermostat? Are you more careful of other household budget items like food? Or are you able to absorb the increased rates without having to make sacrifices to other areas of your budget or your comfort? We would like to know.

Energy Market Prices

The data above is historical, but in the current environment most of us want to know what's happening with energy prices now—and where they'll be in the future. A good tool for that is checking futures prices. Futures prices tell you where the market is pricing something in the future. (Read more about futures contracts at the end of the article, if you're interested.)

Let's consider the futures prices for UK natural gas. (Why natural gas? Electricity generation in the UK comes from many sources, such as natural gas, coal and renewables. Natural gas is the largest contributor to UK electricity generation, so natural gas prices have a big impact on electricity prices.)

For example, we could look at the December 2024 natural gas futures to get an idea of what prices are expected to be for next winter—if they're expected to be as bad as they have been, or any cheaper.

The chart below shows futures prices as of May 2024 in purple, and what the futures prices were back in August and November 2022 (light teal and orange, respectively) as well as August 2023 (bright blue). We've also included the historical close prices in gold (these are essentially the actual, historical wholesale costs at a given time). As you can see, the futures prices indicate that expectations for natural gas prices increased dramatically in August 2022 (light teal), but have dropped since. While it looks as though it could take many years to return to previous prices, wholesale prices seem to be at levels seen at various points in the 2010s.

Another reason that energy prices still feel very high right now is that we'd gotten used to lower electricity bills during the pandemic (as you can see via the futures price drop in 2020 in the chart above). With demand lower, prices dropped. Now, the rising prices feel even more shocking coming off of such low rates.

Why are energy prices so high right now?

Energy prices are high around the globe. It's not just the UK suffering from higher energy prices. There are a number of factors at play in addition to the Russian invasion of Ukraine. Here's a quick overview:

However, rates vary according to how you pay. While Northern Ireland tops the charts for highest prices for direct debit options, those living in Merseyside & the South West paid the highest prices for electricity bills that work on credit (i.e. you pay when you receive your bill, typically every three months) and prepayment.

NEW POLL: Do you think the government should help?

How would you feel about the government subsidising energy bills above a certain point?

Standing (Fixed) Charges for Electricity in the UK

Below are electricity standing charges by region from 1 April 2024. The most expensive region has changed, from North Wales and Merseyside to the Northern area, where residents will pay an average of £247.5 per year for their standing electricity charge, according to the latest EPC announcement. This is 18% more than the UK average. A standing charge is like the line charge on your telephone—it's a fixed cost you'll pay regardless of how much energy you use.

The 2nd highest standing charges are in Yorkshire (£234.4) and the Southern Western area (£233.6).

Northern Ireland is the only area in the UK where you don't pay a standing charge on standard electricity contracts (however, time-of-use contracts like Economy 7 may have a standing charge in NI).

Interestingly, while London has the cheapest standing charge for electricity, capital residents pay the highest standing rates for gas (30.5p/day compared to 29.9p/day on average, pre-VAT).

Here's How Your Electricity Costs Change with Payment Type

How you pay for electricity (i.e., credit, direct debit or prepayment) will affect both your variable unit charges and your standing charges.

What's the cheapest way to pay for electricity?

Paying with a regular direct debit has historically been the cheapest way to buy electricity in the UK for quite a while; that is, direct debit contracts have the lowest variable unit prices on average.

Prepayment meters have historically had the highest standing (fixed) charges, costing households an additional £25 per year vs. paying via direct debit on average. But now standing charges are the same for direct debit and prepayment—with standard credit customers paying around 10% more for the per day charge (equivalent to around an extra £20 per year). But variable charges are a different story, where from 1 April 2024 PPM is 3.3% cheaper per kWh than direct debit (and 8.7% cheaper than standard credit).

If you're looking to save money on your electricity bills, avoid paying via credit as this is now the most expensive payment method in terms of both variable and fixed costs. Those wanting to save can switch tariff or supplier. To learn more, see our guide on Energy Switching.

Are Standard or Economy 7 Electricity Rates Cheaper?

Please note: the figures in this section reflect provisional 2022 data.

Economy 7 tariffs have cheaper night rates by 33% vs. a normal, single rate Standard tariff, but the Economy 7 standing charges are 2% higher and the day rates are 17% higher (on average across all payment methods).

Can you actually save money with an Economy 7 tariff? Using the figures above, if you could manage so that half of your electricity usage occurred during the 7 off-peak hours, you'd pay an average on 27.5 p/kWh for electricity on an Economy 7 tariff, which is in fact 8% cheaper than the Standard rate of 30 p/kWh on average. But keep in mind that while you might be able to run your dishwasher and dryer during the "night" hours which vary but typically run from 11pm to 6 am, your fridge runs all day and you're most likely to use lights, your oven, your kettle and other high-energy appliances during the "day" hours.

How do futures contracts work?

Futures contracts can be confusing, so here's a quick overview. A futures contract is an agreement to buy or sell something (e.g. a commodity or stock) at a predetermined price at a specified time in the future. A futures contract will be for a certain month and year (e.g. March 2022) and the price of that contract indicates what the market thinks the underlying will be trading at in that future month. For example, there'll be a contract for March 2022, one for April, 2022, one for May 2022, and so on. The market trades each of these up until the last trading day of the month before, when the contract expires. So, for example, the March 2022 contract will be traded until the end of February 2022.

If you pick a far-out contract, the price for that contract today tells you where the market anticipates the price will be during the month of that contract. If you pick a nearby contract, the futures price essentially gives you more of a current market price. The futures price converges towards the current price, the closer you get to the contract month—this is because there's less guess work involved the closer you get.

And we can use historical futures prices to see what energy prices have been doing up until the current date. For example, we can look back to July 2021 futures prices to see what natural gas was essentially trading at in July 2021. (Futures prices essentially become current prices once you pass the expiration date of the contract.) This is useful for seeing, for instance, how much prices popped up in November/December 2021 compared to prices over the past couple of years.

Note: The ICE UK natural gas futures contracts used in this article reflect the GBP contract price for 1,000 therms of natural gas per day (1 therm = 29.3071 kilowatt hours) per delivery period (e.g. month).

In the current market, if you're on a default rate which is set by the government’s energy price cap then you theoretically may find better value tariffs. If you're thinking of switching read our Energy Switching Guide.

Energy Price Cap (EPC) vs Energy Price Guarantee (EPG)

It's just been announced that the Energy Price Cap (EPC) will be £1,690/year for a typical household from 1 April 2024 (down from £1,928 for January to March 2024). That means a typical household will see their energy prices drop by approximately £238 per year or £20 per month.

The EPC is lower than the Energy Price Guarantee (EPG), which is currently £3,000, because wholesale energy costs are coming down. The EPG is still around until the end of March 2024, but is not needed. Right now with the EPC lower than the EPG, we simply don't need the EPG.

Remember, these EPC and EPG figures represent annual costs for a household with typical use—in fact the EPC and EPG figures are really fixed on a £ per kWh basis, so those with higher usage will pay more and those with lower usage would pay less than the annualised figures.

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What if I'm being charged more than the EPC?

The max you'll be charged actually depends on where you live, how you pay/your meter, and your tariff—and may vary from the overall stated EPC. The EPC is for a typical consumer who pays by direct debit and is on a standard variable tariff (aka default tariff). If you pay by credit or PPM, your rates are likely to be higher; if you're on a different tariff your rate will also vary. And your region certainly is a factor, too. For instance, the South West has the highest electricity standing charges in England and London has the highest variable charges (£/kWh)—read about the EPC caps on variable and standing charges by region for the current price cap.