The Independent’s journalism is supported by our readers. When you purchase through links on our site, we may earn commission. Why trust us?
The average UK household spends 10 per cent of its annual income on energy bills, so knowing the cost of electricity per kWh can help you manage your bills more effectively.
The energy price cap, set by Ofgem, limits the amount suppliers can charge per kWh of electricity, offering some protection from price hikes. However, in October 2024, this cap is set to rise by 10 per cent, from £1,568 to £1,717 for a typical household.
In this guide, our experts explain what you need to know about the cost of electricity per kWh, helping you manage energy consumption and maximise your savings.
Complete our short form to request solar quotes for your home
Get free, no obligation quotes from up to 5 local solar installers
Compare quotes and pick the option that best suits your needs
A kilowatt-hour (kWh) is a unit of energy that measures the electricity used over time. Specifically, one kWh is equivalent to consuming 1,000W of power for one hour. For example, running a 1,000-watt appliance – such as a small heater – for one hour would consume 1 kWh of electricity.
Up to the end of September 2024, the average cost of electricity per kWh was 22.36p. The amount you paid may have varied, depending on your location and chosen payment method. Ofgem is increasing the cost to 24.50p per kWh between 1 October and 31 December 2024, meaning a typical three-bedroom house’s energy price cap will rise to £1,717 annually.
The energy price cap, introduced by Ofgem in January 2019, is crucial in controlling electricity costs. It sets the maximum price suppliers can charge per unit of energy for customers on standard variable tariffs, where the price you’re charged for energy can change at any time. The cap is reviewed quarterly and adjusted to reflect changes in the wholesale energy market, protecting consumers from excessively high energy costs, especially in volatile market conditions.
It’s important to note the price cap applies to the cost of a unit per kWh, not to your total bill. Therefore, households with higher energy consumption will pay more than the capped amount.
The price cap includes a daily standing charge – a fixed fee energy suppliers charge customers every day, regardless of how much energy they use. This charge is also regulated by Ofgem, and includes the cost of supplying electricity, network maintenance, and administration. The standing charge is separate from the cost of electricity per kWh consumed and varies depending on your meter type, payment method, and location.
Electricity unit prices and standing charges for a typical household
| 1 July to 30 September 2024 | 1 October to 31 December 2024 | ||
| Price per kWh | Daily standing charge | Price per kWh | Daily standing charge |
| 22.36p | 60.12p | 24.50p | 60.99p |
Several factors can influence the cost of electricity and dictate how it evolves.
The long-term trajectory of energy prices in the UK remains uncertain, but in the near-term, Ofgem has announced the energy price cap will increase by 10 per cent, to £1,717 per year, from October to December 2024, due to rising wholesale energy costs.
Industry experts and analysts from Cornwall Insight forecast that prices could continue to climb into early 2025, due to potential increases in global energy demand and market volatility.
The long-term outlook may see energy prices stabilising or decreasing as renewable energy investments, particularly in solar power, continue to grow and the UK reduces its reliance on fossil fuels. While solar panel costs are high, they offer households significant savings over time, by generating free electricity and protecting from price fluctuations.
Yes, electricity prices vary by region, as does the daily standing charge. These variations are due to several factors, including the cost of transmitting electricity over different distances, regional demand, and the costs associated with maintaining and upgrading the local grid infrastructure. Additionally, regional differences in the mix of energy sources and levels of competition among energy suppliers can influence prices.
Typical energy costs per kWh and standing charges across the UK
| 1 July to 30 September 2024 | 1 October to 31 December 2024 | |||
| Region | Price per kWh (pence) | Daily standing charge (pence) | Price per kWh (pence) | Daily standing charge (pence) |
| South East | 23.13 | 56.93 | 25.24 | 57.84 |
| London | 23.53 | 40.79 | 25.69 | 41.59 |
| South West | 22.10 | 67.21 | 24.18 | 68.12 |
| Midlands | 21.69 | 62.75 | 23.83 | 63.62 |
| Wales | 22.37 | 63.27 | 24.49 | 64.12 |
| North East | 21.22 | 67.45 | 23.51 | 68.32 |
| North West | 22.59 | 51.19 | 25.01 | 52.04 |
| Scotland | 21.83 | 63.33 | 23.96 | 64.17 |
The cost of energy bills in the UK varies depending on the size of a house and its occupants’ energy consumption.
Electricity consumption generally encompasses use of lighting, appliances, and electronic devices. Larger homes consume more electricity as they tend to have additional rooms, more occupants and higher appliance use.
Gas is primarily used for heating and hot water. The larger the house, the more gas is typically consumed to maintain a comfortable temperature and provide sufficient hot water, especially in colder months.
Gas and electricity prices are closely linked because gas is often used to generate electricity. When gas prices rise, electricity costs tend to increase as well. This relationship means, if gas prices spike, you may see higher bills for both your gas and electricity usage, especially in regions where gas-fired power plants are a major electricity source.
An overview of the average electricity costs per kWh for different house sizes, broken down by energy and gas consumption
| Property type | Average annual gas consumption | Average annual gas cost | Average annual electricity consumption | Average annual electricity cost | Total average annual cost |
|---|---|---|---|---|---|
| One bedroom | 7,500 kWh | £552.98 | 1,800 kWh | £621.88 | £1,174.86 |
| Three bedrooms | 11,500 kWh | £772.15 | 2,700 kWh | £867.87 | £1,640.02 |
| Five bedrooms | 17,000 kWh | £1,046.10 | 4,100 kWh | £1,180.94 | £2,227.04 |
Understanding electricity costs per kWh is crucial for managing household energy expenses effectively.
Electricity prices are influenced by factors such as wholesale energy costs, fuel types, regional differences, and government policies such as the energy price cap. Being aware of these variables means you can better anticipate potential increases in your energy bills and make informed decisions about your energy usage.
Staying informed about electricity costs enables you to consider energy-saving measures or alternative energy sources such as solar panels. It can also help you budget, empowering you to take proactive steps to reduce energy consumption and, ultimately, save money.
Yes, solar panels can significantly reduce electricity costs by generating your electricity from daylight, which decreases the amount of power you need to purchase from the grid. Over time, the savings on your energy bills can offset the initial investment in the best solar panels, leading to lower overall energy expenses.
Yes, several solar panel grants are available to help with electricity costs, including the Warm Home Discount, which offers a £150 discount on winter electricity bills for eligible low-income households. The ECO4 grant scheme funds energy-saving home improvements such as insulation, heating upgrades, and solar panels.
Electricity is generally more expensive during peak times, typically between 4pm and 8pm. This is when demand is highest, leading to increased costs on tariffs such as Economy 7 or time-of-use plans.
