London Daily

Focus on the big picture.
Friday, Nov 21, 2025

Why are gas bills so high and what's the energy price cap?

Why are gas bills so high and what's the energy price cap?

Electricity and gas bills for a typical household will go up by £693 a year in April, a 54% increase.

The government says financial support will help cover some of the rise.

How much will my energy bill go up?


Around 18 million households on standard tariffs will see an average increase of £693 - from £1,277 to £1,971 per year.

Around 4.5 million prepayment customers will see an average increase of £708 - from £1,309 to £2,017.

The amount your bill will go up depends on how much energy you use.

Energy bills won't rise immediately for customers on fixed rates, but many are likely to see a significant increase when their deal ends.

What is the energy price cap?


Bills are going up because the energy price cap - the maximum price suppliers in England, Wales and Scotland can charge households - is being raised.

Energy firms can increase bills by 54% when the new cap is introduced in April.

Prices are expected to rise again in October.


What help can people get?


The government says it will offer extra help worth a total of £350 - just over half the increase facing a typical household:

*  April: People in council tax bands A to D in England will receive a one-off £150 discount. This will apply to about 80% of homes

*  October: Customers in England, Scotland and Wales will receive a £200 rebate on their energy bills. They will have to repay this at £40 a year for five years, starting in April 2023

In England local authorities will also have access to a £150m fund to help lower income households living in higher council tax properties. It will also help households in bands A to D who already don't pay council tax.

The warm house discount scheme will be expanded, to cover three million households. It offers low income households a one-off annual discount on their electricity bill, and was worth £140 in 2021/22.

Because the council tax measures only apply in England, £565m will be given to other UK nations to fund equivalent help.

The Northern Ireland energy market is separate, but the government said £150m would be available to support households there.

The government ruled out scrapping the 5% VAT rate on household heating bills, as it said this would disproportionately help wealthier households.


How do energy prices affect the cost of living?


More households are expected to find themselves facing fuel poverty - meaning they spend a disproportionate amount of their income on energy.

The way fuel poverty is measured varies around the UK.

In Scotland, a household is in fuel poverty if more than 10% of its income is spent on fuel and its remaining income isn't enough to maintain an adequate standard of living.

Based on this measure, the Resolution Foundation think tank expects the number of homes facing "fuel stress" across the UK to treble to 6.3 million after April. It says pensioners and people in local authority housing will be hit hardest.

It warns UK households are facing a "cost of living catastrophe".

Food prices are also rising, and an increase in National Insurance in April will leave millions facing higher tax bills.

The Bank of England has put up interest rates for the second time in three months to try and slow price rises.

Why have gas prices gone up?


A worldwide squeeze on energy supplies has pushed the price of gas prices up to unprecedented levels:

*  a cold winter in Europe in 2020/21 put pressure on supplies and reduced the the amount of gas stored

*  a relatively windless summer in 2021 made it difficult to generate wind energy

*  increased demand from Asia - especially China - put pressure on liquefied natural gas supplies

The UK is relatively hard-hit because about 85% of homes have gas central heating, and gas generates a third of the country's electricity.


Why have energy firms collapsed?


When wholesale gas prices spiked, many energy suppliers collapsed - affecting millions of households.

This is largely because the energy price cap prevented them passing on all of their increased costs to customers.

When their supplier went bust many households were switched to a more expensive deal with another supplier.


How can I protect myself from rising prices?


In the past, consumers have been encouraged to shop around when bills rise.

But at the moment better offers - especially fixed deals - are not available.

People already on fixed deals are advised to stay put.

Other households are being encouraged to improve the energy efficiency of their homes.

The Energy Saving Trust says simple changes to our homes and habits could offset the current price rises.


Newsletter

Related Articles

0:00
0:00
Close
Students Challenge AI-Driven Teaching at University of Staffordshire
Pikeville Medical Center Partners with UK’s Golisano Children’s Network to Expand Pediatric Care
Germany, France and UK Confirm Full Support for Ukraine in US-Backed Security Plan
UK Low-Traffic Neighbourhoods Face Rising Backlash as Pandemic Schemes Unravel
UK Records Coldest Night of Autumn as Sub-Zero Conditions Sweep the Country
UK at Risk of Losing International Doctors as Workforce Exodus Grows, Regulator Warns
ASU Launches ASU London, Extending Its Innovation Brand to the UK Education Market
UK Prime Minister Keir Starmer to Visit China in January as Diplomatic Reset Accelerates
Google Launches Voluntary Buyouts for UK Staff Amid AI-Driven Company Realignment
UK braces for freezing snap as snow and ice warnings escalate
Majority of UK Novelists Fear AI Could Displace Their Work, Cambridge Study Finds
UK's Carrier Strike Group Achieves Full Operational Capability During NATO Drill in Mediterranean
Trump and Mamdani to Meet at the White House: “The Communist Asked”
Nvidia Again Beats Forecasts, Shares Jump in After-Hours Trading
Wintry Conditions Persist Along UK Coasts After Up to Seven Centimetres of Snow
UK Inflation Eases to 3.6 % in October, Opening Door for Rate Cut
UK Accelerates Munitions Factory Build-Out to Reinforce Warfighting Readiness
UK Consumer Optimism Plunges Ahead of November Budget
A Decade of Innovation Stagnation at Apple: The Cook Era Critique
Caribbean Reparations Commission Seeks ‘Mutually Beneficial’ Justice from UK
EU Insists UK Must Contribute Financially for Access to Electricity Market and Broader Ties
UK to Outlaw Live-Event Ticket Resales Above Face Value
President Donald Trump Hosts Saudi Crown Prince Mohammed bin Salman at White House to Seal Major Defence and Investment Deals
German Entertainment Icons Alice and Ellen Kessler Die Together at Age 89
UK Unveils Sweeping Asylum Reforms with 20-Year Settlement Wait and Conditional Status
UK Orders Twitter Hacker to Repay £4.1 Million Following 2020 High-Profile Breach
Popeyes UK Eyes Century Mark as Fried-Chicken Chain Accelerates Roll-out
Two-thirds of UK nurses report working while unwell amid staffing crisis
Britain to Reform Human-Rights Laws in Sweeping Asylum Policy Overhaul
Nearly Half of Job Losses Under Labour Government Affect UK Youth
UK Chancellor Reeves Eyes High-Value Home Levy in Budget to Raise Tens of Billions
UK Urges Poland to Choose Swedish Submarines in Multi-Billion € Defence Bid
US Border Czar Tom Homan Declares UK No Longer a ‘Friend’ Amid Intelligence Rift
UK Announces Reversal of Income Tax Hike Plans Ahead of Budget
Starmer Faces Mounting Turmoil as Leaked Briefings Ignite Leadership Plot Rumours
UK Commentator Sami Hamdi Returns Home After US Visa Revocation and Detention
UK Eyes Denmark-Style Asylum Rules in Major Migration Shift
UK Signals Intelligence Freeze Amid US Maritime Drug-Strike Campaign
TikTok Awards UK & Ireland 2025 Celebrates Top Creators Including Max Klymenko as Creator of the Year
UK Growth Nearly Stalls at 0.1% in Q3 as Cyberattack Halts Car Production
Apple Denied Permission to Appeal UK App Store Ruling, Faces Over £1bn Liability
UK Chooses Wylfa for First Small Modular Reactors, Drawing Sharp U.S. Objection
Starmer Faces Growing Labour Backlash as Briefing Sparks Authority Crisis
Reform UK Withdraws from BBC Documentary Amid Legal Storm Over Trump Speech Edit
UK Prime Minister Attempts to Reassert Authority Amid Internal Labour Leadership Drama
UK Upholds Firm Rules on Stablecoins to Shield Financial System
Brussels Divided as UK-EU Reset Stalls Over Budget Access
Prince Harry’s Remembrance Day Essay Expresses Strong Regret at Leaving Britain
UK Unemployment Hits 5% as Wage Growth Slows, Paving Way for Bank of England Rate Cut
Starmer Warns of Resurgent Racism in UK Politics as He Vows Child-Poverty Reforms
×