Energy price cap

The energy price cap is a limit set by Ofgem, the energy regulator for Great Britain, on the unit rates and standing charges suppliers can charge households on default (standard variable) tariffs. It caps prices, not your total bill: using more energy still costs more.

According to Ofgem, from 1 October to 31 December 2026 the cap rises by 4% and a typical household paying by Direct Debit for gas and electricity pays £1,723 a year, up £60 from £1,663. Average Direct Debit rates are:

• electricity: 26.32p per kWh and 54.83p a day standing charge;
• gas: 7.97p per kWh and 29.68p a day standing charge.

Ofgem says there is no VAT on electricity from 1 October 2026 to 31 March 2027, and that bills would otherwise have been about £45 higher. Ofgem sets the cap every three months, and it protects around 22 million households.

Example: a 2 kW heater run for 3 hours uses 6 kWh, which costs £1.58 at 26.32p per kWh.

Work out what your appliances cost at the cap rate with the appliance running cost calculator.