⚡ What Are the Price Cap Unit Rates? Understanding Your Energy Costs in the UK
If you’ve ever looked at your electricity or gas bill and thought “What am I actually being charged for?” — you’re not alone. With energy costs still a hot topic across the UK, understanding unit rates under the energy price cap can help you take control of your energy bills and potentially save hundreds of pounds.
In this guide, we explain what unit rates are, how the Ofgem energy price cap affects them, and where to find the most up-to-date figures — with UK-specific examples.
🔍 What Is a Unit Rate on Your Energy Bill?
A unit rate is the amount you pay for each kilowatt-hour (kWh) of electricity or gas you use. This cost is variable depending on your:
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Tariff type (standard vs fixed)
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Energy provider
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Region in the UK
Your energy bill typically includes two key charges:
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Unit Rate (pence per kWh): The price per unit of energy used
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Standing Charge (pence per day): A fixed daily fee to stay connected to the grid
🏛 What Is the Energy Price Cap?
Introduced in 2019 by Ofgem, the energy price cap limits the maximum unit rates and standing charges energy suppliers can charge customers on standard variable or default tariffs.
The cap doesn’t cover:
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Fixed tariffs (you agreed on a set rate)
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Business energy customers
The cap is reviewed quarterly, so rates can change four times per year — in January, April, July, and October.
Latest update: The current cap covers 1 July to 30 September 2025.
📊 Price Cap Unit Rates (July – September 2025)
The average unit rates for customers paying by direct debit are:
| Energy Type | Unit Rate (p/kWh) | Standing Charge (p/day) |
|---|---|---|
| Electricity | 23.94p | 60.12p |
| Gas | 6.20p | 31.41p |
(Source: Ofgem Price Cap Overview)
These figures are based on a typical dual-fuel household in Great Britain with medium usage.
🗺 Do Unit Rates Vary by Region?
Yes, they do. While Ofgem sets an overall cap, distribution costs differ by location. That means someone living in London could pay slightly less than someone in Northern Scotland.
Example comparison:
| Region | Electricity Rate | Gas Rate |
|---|---|---|
| London | 23.2p/kWh | 6.1p/kWh |
| North Scotland | 25.3p/kWh | 6.4p/kWh |
💬 Why Do Unit Rates Matter?
Knowing your unit rate helps you:
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Calculate your real energy cost
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Spot overcharging or billing errors
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Compare suppliers more accurately
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Adjust your energy habits to reduce costs
For example, if your electricity rate is 24p per kWh and you run a 1,500W (1.5kW) heater for 1 hour a day:
That’s just one device — multiply that by others in your home to understand your true usage.
🏦 How Are UK Banks Helping with Energy Cost Awareness?
While banks don’t set energy prices, many UK banks now offer tools to help manage utility bills, especially as energy remains a top household expense.
| Bank | Energy-Supportive Features |
|---|---|
| NatWest | Carbon footprint tracker helps monitor your estimated household energy impact |
| Barclays | Money management dashboard includes utility spend analysis |
| Lloyds Bank | Personal finance tools help track direct debits, including energy bills |
| HSBC UK | Budget planner tool lets you set energy bill limits |
If your energy payments are pushing you into debt, these banks may also provide payment holidays, overdraft buffers, or financial hardship support.
🧮 How to Use Unit Rates to Estimate Your Bill
Want to get a rough idea of your monthly bill?
Here’s how to calculate it manually:
Step 1: Find your annual usage from your supplier bill or smart meter (average: 2,700 kWh electricity, 11,500 kWh gas).
Step 2: Multiply each by the current unit rate.
Step 3: Add 365 days of standing charges.
Example:
⚠️ Are You Overpaying?
Even with the price cap in place, many households are overcharged due to:
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Estimated usage instead of real meter readings
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Being on more expensive tariffs
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Energy firms miscalculating direct debits
If you’re unsure:
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Submit up-to-date meter readings
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Ask your supplier for a payment review
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Check your bill for unit rates and compare to the cap
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Switch if a better deal is available (fixed tariffs may now undercut the cap)
🧠 Top Tips to Save with High Unit Rates
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Switch off unused devices – “vampire” electronics can add £100+/year
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Install a smart thermostat – lowers heating bills efficiently
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Lower boiler flow temperature – try 60°C for efficiency
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Use energy-efficient bulbs and appliances
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Monitor usage with a smart meter – ask your supplier for a free one
🆘 What to Do If You Can’t Afford the Rates
If your unit rates are making bills unaffordable:
✅ 1. Contact Your Supplier
They must offer affordable repayment plans and support under Ofgem rules.
✅ 2. Apply for Support Schemes
You may qualify for:
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Warm Home Discount (£150 one-off)
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Winter Fuel Payment
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Cost of Living Payments
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Grants from energy charities
See: Help for Households – GOV.UK
✅ 3. Speak to a Debt Charity
Free advice from:
✅ Summary: What to Remember About Price Cap Unit Rates
| Topic | Summary |
|---|---|
| What are unit rates? | What you pay per kWh of gas/electricity |
| Who sets them? | Ofgem – they change quarterly |
| Current average rates | ~23.94p/kWh electricity, ~6.20p/kWh gas |
| Why do they matter? | They determine your bill — not your supplier’s logo |
| Where to compare? | Uswitch, MSE, supplier websites |
| What if you overpay? | Request a review or switch tariff/provider |
🔍 Final Thought: Know Your Rates, Slash Your Bills
Understanding unit rates under the energy price cap gives you a powerful advantage. It lets you check your bills with confidence, question unfair direct debits, and choose smarter tariffs.
In a time when every penny counts, knowing exactly how much you’re being charged per unit of energy can be the key to reclaiming control over your household budget.