Energy bills set for series of falls - how much will bills drop throughout 2025?
After years of record high gas and electricity bills, the energy price cap is predicted to fall three times in a row this year, according to forecasts by energy consultancy Cornwall Insight.
Ahead of the energy price cap announcement on Friday, analysts estimate the cap will fall £129 (7%), bringing the annual bill for a typical household £1,720 a year.
The current price cap - which is in place between April 1 and June 30 2025 - is £1,849 a year, having risen in October 2024, January and April.
Bills had risen through winter due to wholesale gas price rises and falling European stores through a cold winter. The cost of electricity is linked to gas prices.
NimbleFins research into gas futures prices shows prices through the 2025 winter are set to be lower than initially forecast.
Price falls are not a certainty, but the actual gas prices have historically been lower than futures prices over recent years.
However, now is "not the time for complacency", Dr Craig Lowrey, Cornwall Insight's principal consultant.
He added: "Prices are falling, but not by enough for the numerous households struggling under the weight of a cost-of-living crisis.
"As such, there remains a risk that energy will remain unaffordable for many.
"If prices can go down, they can bounce back up, especially with the unsettled global economic and political landscape we are experiencing. This is not the moment for complacency."
Dr Lowrey urged the Government to bring in affordable options for struggling households, such as social tariffs or 'zonal pricing' which would charge different regions different rates based on supply and demand levels.
Will my energy bill definitely fall?
If you're on a standard variable tariff (the type covered by the price cap), then yes – your unit rates and standing charges should fall in line with the new cap when it changes. Ofgem updates the cap every three months, so your bill will adjust accordingly.
However, if you're on a fixed-rate tariff, you won’t benefit until your current deal ends. Some suppliers have started offering competitive fixed tariffs again, but you’ll need to weigh up the risk of locking in a higher rate if prices keep falling.
The exact amount the price cap will fall is not yet known, but Cornwall Insights predicts three drops for the rest of the year.
The gas futures index for May 2025 shows the wholesale price to drop to around levels consistent with winter 2024. October to December 2024 saw the price cap at £1,717, and £1,738 in January to March 2025.
Should I fix my energy deal now?
It depends. Some consumers may prefer the certainty of a fixed deal, especially if it's lower than the current price cap or close to the July forecast. However, with further price drops predicted later this year and into 2026, many may find it better to stay on the variable tariff for now.
Energy price cap dates 2025
| Price cap announcement date | Covers billing period |
|---|---|
| 23 May 2025 | 1 July 2025 to 30 September 2025 |
| By 27 August 2025 | 1 October 2025 to 31 December 2025 |
| By 25 November 2025 | 1 January 2026 to 31 March 2026 |
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