Why are energy prices so high?
The rapid rise in energy prices through 2022 was driven by a host of factors, including soaring inflation, a shortage in supply and rising demand after the pandemic. While prices have fallen since their peak in the summer of 2022, prices have remained high when compared to pre-pandemic levels.
The Energy Price Guarantee now no longer applies to households without a prepayment meter. But the current Energy Price Cap, which runs from January 2024 to March 2024, is set at £1,928 per year for a typical household:
- On a dual fuel tariff
- Paying for their energy by direct debit.
However, this doesn’t mean this is the maximum you’ll pay. The cap limits the energy prices suppliers can charge for units of gas and electricity. The size of your bill depends on how much energy you use, where you live and how you pay.
If you use more than the average household, you'll pay more than the price cap.
From 1 April 2024, the new Ofgem energy price cap will take effect. This will cap energy prices for a typical usage household at:
- £1,690 for those paying by direct debit.
- £1,643 for those with a pre-payment meter.
- £1,796 for those who pay their bills every three months by cash or cheque.
When will energy prices go down?
Energy prices have already started falling since their peak in the summer of 2022, with the Energy Price Cap lower than the Energy Price Guarantee. So, you should be paying less for your energy bills.
Ofgem have recently announced their new energy price cap, which is due to take effect from 1 April. This sees a typical usage household pay no more than £1,690 per year, when paying by direct debit. This is £238 cheaper than the previous cap and the lowest it’s been since early 2022. However, this is still significantly higher than pre-pandemic levels.
How is the Energy Price Guarantee applied?
If you don’t have a prepayment meter, you’ll no longer get an Energy Price Guarantee discount.
From 1 October 2023, customers on pre-payment meters will get a discount on gas standing charges. The discount will be applied automatically – you don’t have to use vouchers or contact your energy supplier. The rate you get will vary depending on where you live.
The scheme doesn’t apply to Northern Ireland.
Can I switch to a better deal?
Suppliers have started to launch new fixed tariffs, but energy prices remain high. At Compare the Market, we're dedicated to help you find the right deal for you. Compare today to see if you could find a better energy tariff.
How to save on your energy bills in the home
We’ve put together some of our best energy tips for keeping gas and electric costs down.
How do I compare energy prices?
There aren’t many deals that are cheaper than the Energy Price Cap, so switching may not save you money right now. But new deals are coming onto the market, so we’ll soon be here to help you find cheap energy deals again.
Sign up to our switch alerts to know when new deals become available.
Here’s a reminder of how switching works:
How do I switch energy suppliers?
When switching is possible again through Compare the Market, all you’ll need to get started is a recent energy bill.
We’ll need to know:
- The name of your current supplier and tariff name
- How much energy you use (in kWh or pounds).
How do I know which supplier is right for me?
There are a few things to consider when deciding whether a supplier is right for you:
- Is the deal they’re offering below the Energy Price Cap?
- Do you want to switch to a fixed rate deal, given the uncertainty about future prices?
- Does the provider have a good reputation for customer service?
How long will it take to switch energy suppliers?
It should take no longer than five working days to switch energy suppliers under the Energy Switch Guarantee.
What happens when I switch?
Your gas and electricity supply will carry on as normal when you switch energy suppliers. The only thing that changes is where your bills come from.
What if I change my mind about switching?
You’ll have a 14-day cooling-off period starting from when you agree your new contract. You can cancel without a penalty during this time.
What our expert says...
"Soaring energy costs have been making life extremely difficult for many households. However, prices are starting to fall, so hopefully more deals will be coming onto the market soon. Meanwhile, don’t hesitate to contact your energy supplier if you’re struggling to see if you’re eligible for help with your energy bills."
- Sajni Shah, Utilities comparison expert
Compare business energy
You can still compare business energy with us. Simply answer a few questions and our trusted partner, business energy experts Bionic, will do all the legwork, including arranging the switch for you.Compare business energy
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What support is available if I’m struggling with my energy bills?
All energy suppliers must have plans in place to help customers who can’t afford to pay their bills. Ofgem rules mean suppliers must offer payment plans you can afford, and you can ask for ‘emergency credit’ if you use a prepay meter and can’t top up. If you’re having difficulties, it's best to contact your energy supplier as soon as possible.
If you’re having difficulties, contact your energy supplier as soon as possible.
See our guide on what to do if you can’t afford your energy bills.
The government is continuing to offer a package of support measures to help households with rising energy bills and the cost of living. This runs through to spring 2024. See all the available government support to help with the cost of living.
Why switch gas and electricity providers?
There are several reasons to compare gas and electric and consider switching your supplier:
Getting a better deal
Carrying out an energy price comparison and evaluating suppliers each year can potentially save you hundreds on the cost of your gas and electricity. Compare the Market is constantly monitoring the energy market to ensure you can get a deal that’s right for you.
You may be unhappy with the service provided by your supplier. Switching to a supplier with better customer service could fix this.
You might want a supplier that uses more renewable energy.
Enjoy fantastic rewards, on us*
Can I save money by switching energy suppliers?
Looking for the cheapest energy supplier and regularly switching is usually one of the best ways to save on your energy bills. But the energy market is highly volatile at the moment, so it may not be a good idea to switch right now.
Compare the Market will help you with your energy comparisons again as soon as we can.
Which tariff is best for me?
It depends on what you want from an energy deal and your financial situation. There are several types of energy tariffs:
- Dual fuel – getting gas and electricity from the same supplier can be the cheapest option. It also means you’ll only have one bill to deal with.
- Green energy – If you want to reduce your carbon footprint, you can look at energy suppliers who specialise in wind, solar or other renewable sources to offset their carbon usage.
- Variable tariff – these tariffs fluctuate according to the market. So if prices go up, you’ll pay more. If they fall, you’ll save.
- Fixed rate tariff – these tariffs can make budgeting easier as the unit price of energy is fixed for a set period of time.
- Prepayment energy tariff – as the name suggests, you have to pay in advance for your energy with a prepayment tariff.
- Economy 7 tariff – an Economy 7 tariff can give you a cheaper rate for electricity during ‘off-peak’ hours, usually at night.
Frequently asked questions
How often do energy prices change?
Energy prices change all the time. They reflect market supply and demand, and fluctuate as a result. They're also affected when wholesale costs change.
The current Ofgem Energy Price Cap is set every three months, reflecting inflation as well as underlying costs of energy. It caps the unit price of gas and electricity for a typical household with a dual-fuel tariff paying by direct debit. But the amount you pay altogether will still depend on how much energy you use.
What’s the cheapest way to pay for gas and electricity?
The cheapest way to pay your gas and electric bill is usually via direct debit.
Where can I get the cheapest gas and electric?
Shopping around for the cheapest deal can often be the best way to save on gas and electricity. However, there aren’t many deals available to switch to at the moment.
But with wholesale energy prices falling, this is expected to change. This could signal a return of competition in the energy market and a cheapest energy supplier or tariff returning.
What is the difference between fixed and variable-rate tariffs?
Is it easier to switch gas and electricity together?
Switching dual fuel or switching one energy type on its own are both simple when you use Compare the Market. The only potential complication would be if you are on a fixed-term contract that hasn’t yet expired, as you may have to pay an exit penalty.
When switching is possible again, it will help if you have both your latest gas and electricity bill to hand, because the answers to the questions we’ll ask you will be there. If you don’t have a bill, then don’t worry, we’ll be able to compare energy prices based on estimations.
Can I switch energy supplier if I owe money?
If you have bills that are more than 28 days old, you might find that you can’t change energy supplier until you’ve paid them. But there are some exceptions.
For example, if you’re on a prepayment meter and you have debts of up to £500 on gas and £500 on electricity. The energy supplier you switch to will take on the debt and you will repay them instead.
I'm moving home. How can I switch gas and electricity?
If you’re moving and your existing deal is a good one, it can be carried over to your new home – just tell your energy supplier the new address and the moving-in date.
On moving day, take a meter reading before you leave and give this to your supplier. This way you can be sure your final bill will only reflect what you’ve used.
Be sure to also take a meter reading at your new home so you won’t be paying for energy used by the previous owner.
Can I switch energy provider if I rent?
Tenants can switch energy providers if they pay the supplier directly for their gas and electricity.
If your landlord pays your energy bills then charges you, choosing the energy supplier is up to them, although you can always ask them to change to get cheaper gas and electricity.
Can I get a smart meter if I switch gas and electricity?
It depends on what stage your gas and electricity supplier is at in their smart meter programme. The rollout is being managed by individual energy companies. You can ask your current energy supplier for a smart meter and they will let you know if it is possible to get one and when.
Make sure any tariff you switch to is the best energy deal for you –in the past there have been some beneficial tariffs for smart meter users.
See more about how smart meters work in our guide to smart meters.
How can I find a green energy supplier?
When you can compare with us again, you’ll be able to choose to see tariffs for 100% renewable electricity.
See more on renewable energy.