After months of feeling the squeeze from stubbornly high utility bills, UK households are about to catch a small but welcome break.

This summer, energy costs are set to fall, giving a bit of breathing room to millions across the country.

But before celebrating too much, there’s a lot more to unpack.

Ofgem Announces a Summer Price Drop

Energy regulator Ofgem has confirmed that, starting in July, the energy price cap will drop by £129.

That brings the average household bill down from £1,849 to £1,720—a 7% decrease.

This change affects both electricity and gas rates, with unit prices falling to 25.73p/kWh for electricity and 6.33p/kWh for gas.

Standing charges will be 51.37p for electricity and 29.82p for gas per day.

However, it’s important to remember that this “average” is based on typical usage, so your actual bill may look different depending on how much energy you use.

How Does This Compare to Recent Caps?

The new price cap puts us back at a similar level to where things were in October 2024, when the cap sat at £1,717.

So yes, this is a drop—but it’s far from the pre-energy-crisis days.

Households are still paying significantly more than they did before wholesale prices shot up globally.

Experts Say the Market Is Still Shaky

Energy analysts at Cornwall Insight, who correctly predicted this price change, have a word of caution.

Their principal consultant, Dr Craig Lowrey, emphasized that while the price drop is a relief, the energy market is still highly unstable.

He pointed out that everything from political events to extreme weather can cause a spike in prices again.

“It’s great news in the short term,” he said, “but we’re still dealing with higher-than-normal bills, and support for struggling families remains crucial.”

What About the Rest of the Year?

Looking ahead, Cornwall Insight expects the price cap to fall slightly again in October to £1,727 and possibly drop even further by January 2026.

Energy suppliers have offered their own forecasts—Octopus Energy believes October’s cap might land closer to £1,662, while British Gas puts it around £1,715.

These aren’t guarantees, but they give a rough idea of what households might expect later in the year.

Is Now a Good Time to Lock in a Fixed Deal?

With prices coming down, you might be wondering whether it makes sense to switch to a fixed deal.

Interestingly, many households already have. In fact, millions have jumped on competitive fixed-rate plans that are already beating the July cap.

Richard Neudegg from Uswitch notes that the savings from fixed tariffs are often more significant than just riding out the cap.

The best fixed deal currently available is from Outfox the Market, with a 12-month plan costing £1,517 annually.

That’s £203 cheaper than the upcoming July cap.

Top Fixed Deals That Beat the Price Cap

Here’s a snapshot of some of the best deals out there right now:

Outfox the Market 12-Month Fix – £1,517/year | £332 less than April’s cap | £50 exit fee per fuel
Outfox 18-Month Fix – £1,520/year | £329 less | £75 exit fee per fuel
Outfox 24-Month Fix – £1,525/year | £324 less | £100 exit fee per fuel
So Energy One-Year Green Deal – £1,591/year | £258 less | £50 exit fee
Octopus Energy 12-Month Fixed – £1,625/year | £224 less | No exit fees

These fixed deals offer certainty and, in many cases, better value than sticking with the price cap—especially if the market swings back up.

How to Find the Best Deal for Your Home

If you’re considering making a switch, comparison sites like Uswitch can help you find a deal tailored to your home and usage.

You just pop in your postcode and energy usage, and you’ll see which options could save you the most money.

And here’s a bonus—many green energy providers are included too, which means you could cut costs and lower your carbon footprint at the same time.

Final Thought: A Step in the Right Direction, But Not the Finish Line

While the upcoming drop in energy bills is certainly something to be happy about, it doesn’t erase the bigger picture.

Prices are still elevated compared to pre-crisis times, and many households are still facing affordability issues.

So while it may be the right time to switch or fix your tariff, it’s also a reminder that long-term energy reforms and support systems remain essential.