Russia launches full-scale invasion of Ukraine, energy prices spike

Wholesale gas and electricity prices spiked after Russia launched a full-scale invasion of Ukraine on 24 February 2022, according to the House of Commons Library. Prices had already been rising since summer 2021, when economies began reopening after pandemic lockdowns, and increased further in late 2021 and early 2022¹.

The first major impact on domestic customers in Great Britain, meaning those on standard variable tariffs covered by the energy price cap, was a 54% increase in the cap in April 2022¹. The Library says record prices in 2022 would have led to an 80% increase in the cap without government intervention. The Energy Price Guarantee limited the increase to 27% in October 2022 and meant domestic consumers paid less than they would have under the price cap until July 2023¹.

The Library's figures show how bills moved through the crisis and afterwards. Under the July to September 2026 direct debit cap the average annual bill for typical gas and electricity consumption is £1,663, below the peak of £2,106 under the Energy Price Guarantee from October 2022 to June 2023, but 18% higher than the recent low in July to September 2024¹.

Source: House of Commons Library¹

Under the current direct debit cap the average price of gas is 7.3 pence per kilowatt hour and electricity 26.1 p/kWh, with average standing charges of 29.0 p/day for gas and 57.2 p/day for electricity¹. The cap will increase by 4% in the fourth quarter of 2026, and the Library reports a forecast of a further 9% rise in the first quarter of 2027¹. Ofgem reduced its Typical Domestic Consumption Values again in July 2026, cutting assumed annual gas use by 17% to 9,500 kWh and electricity by 7% to 2,500 kWh, which makes an average bill look lower even if unit prices are unchanged¹.

Northern Ireland is not covered by the price cap and only a minority of households there use mains gas for heating. Government support said to be equivalent to the Energy Price Guarantee led the largest electricity supplier in Northern Ireland to cut prices in November 2022 to below those in the rest of the UK, but reductions in that support from April 2023 and its ending from July 2023 led to price rises in 2023. Since October 2023 the cheapest prices from Northern Ireland's largest supplier have been higher than prices under the cap in the rest of the UK¹.

Why it matters for households

The invasion marked the point at which wholesale prices moved from a steady rise into a spike, and the effects reached household bills through the cap. The April 2022 increase of 54% was the first major impact on customers on standard variable tariffs in Great Britain¹. The Energy Price Guarantee then held the October 2022 increase to 27% rather than the 80% the Library says record prices would otherwise have produced, and it set maximum prices for customers on standard variable tariffs from October 2022 to June 2023¹.

Bills have fallen back from the peak but not to pre-crisis levels. The Library says the October 2026 cap increase will leave bills for typical consumption 58% above their winter 2021/22 level¹. Annual bills are not capped: households using more energy pay more, those using less pay less, and prices vary by region and are higher for customers paying by quarterly bills¹. The cost of living crisis coverage sets out how prices developed from 2021.

What happens next

The price cap rises by 4% in the fourth quarter of 2026, with average gas unit prices up 9% to 8.0 p/kWh and electricity up 1% to 26.3 p/kWh. The gas standing charge rises by 0.7 p/day and the electricity standing charge falls by 2.4 p/day. The electricity values include the effect of the government's decision to remove VAT from electricity bills for six months from October 2026¹. The cap is forecast to rise by a further 9% in the first quarter of 2027, though the Library notes forecasts are uncertain¹. The Energy Price Guarantee ended in March 2024 after falling cap levels meant it was not needed again¹.