As of 1 July 2025, Ofgem has reduced the energy price cap by 7%, bringing the average household bill down to £1,720/year — a saving of £129 compared to the previous quarter. But even with that drop, savvy households can still find cheaper options. Here’s how to beat the cap and save even more on your energy bills.
1. Don’t settle for the default cap
Staying on the default energy tariff might feel safe, but it’s rarely the cheapest. Many fixed, tracker and variable deals are now undercutting the price cap. Experts are urging households to shop around rather than simply ride the capped rate — especially as more competitive deals start to return to the market.
2. Consider switching to a fixed tariff
Although the price cap dropped in July, forecasts suggest it could rise again in 2026. A well-timed switch to a fixed tariff — ideally one that’s at least 5% cheaper than the current cap — could lock in savings for the long term and protect you from potential hikes.
3. Explore tracker tariffs and time-of-use deals
Tracker tariffs follow the market, often staying a few percentage points below the cap. They offer flexibility and potential savings without locking you in. Some suppliers also offer time-of-use tariffs, where energy is cheaper at off-peak hours — perfect for those who can shift usage overnight or during the day.
4. Leverage collective switching
Collective switching allows groups of consumers to negotiate exclusive rates from suppliers. This approach can unlock cheaper deals than going solo, especially when energy providers are looking to win new customers in bulk.
5. Watch for changes in standing charges
Ofgem is currently reviewing the way standing charges work — these are the flat daily fees you pay regardless of usage. Proposals include offering a zero standing charge tariff or adjusting charges based on household income or vulnerability. These changes could reshape how your bill is calculated later this year or into 2026.
6. Keep an eye on clean energy innovation
New clean-energy suppliers are entering the market with smarter, tech-driven tariffs and renewable energy packages. Some offer solar integration, smart battery storage, or dynamic pricing that responds to market conditions. These innovations are driving competition and could offer savings of £150–£200 a year in the near future.
Quick-Start Action Plan
1. Compare your current energy bill to the new £1,720 price cap.
2. Look for fixed or tracker tariffs that offer at least 5% savings.
3. Explore collective switching options.
4. Monitor Ofgem announcements around standing charge reform.
5. Check out emerging energy providers with smart, green pricing.
6. Don’t wait — compare and switch if a better deal exists.