Key facts
- Q2 2026 cap (1 Apr to 30 Jun): £1,641 for a typical dual fuel direct debit household
- Q3 2026 cap (from 1 Jul): £1,862 on the 2023 benchmark; £1,663 on new typical consumption values
- Current unit rates: electricity 24.7p per kWh, gas 5.7p per kWh
- The cap applies only to default (standard variable) tariffs, not fixed deals
What Is the Energy Price Cap?
The energy price cap was introduced by Ofgem in January 2019 to protect households on default (standard variable) tariffs from being overcharged. Before the cap, suppliers could charge whatever they liked on SVT (standard variable tariffs), and many were significantly more expensive than the cheapest deals.
Ofgem reviews the cap quarterly (every 3 months) based on wholesale energy prices, network costs, and operating expenses. When wholesale prices spiked in 2021 to 2022 following Russia's invasion of Ukraine, the cap rose dramatically, from £1,277 in Q1 2021 to £3,549 by Q4 2022.
Current Energy Price Cap (2026)
| Period | Annual Bill (Typical Use) | Electricity (p/kWh) | Gas (p/kWh) |
|---|---|---|---|
| Q1 2026 (Jan to Mar) | £1,758 | 24.5p | 6.1p |
| Q2 2026 (Apr to Jun) | £1,641 | 24.7p | 5.7p |
| Q3 2026 (Jul to Sep) | £1,862 | TBC | TBC |
Does the Price Cap Apply to Your Tariff?
The price cap only applies to households on a default (standard variable) tariff. If you are on a fixed-rate energy deal, your rates are set by that contract, not the cap. Fixed deals can be above or below the cap depending on when you signed up and how wholesale prices have moved since.
When to Fix vs Stay on the Cap
If a fixed-rate deal is lower than the current cap unit rates, fixing can save money, but you give up flexibility if the cap falls further. In 2026, with the cap set to rise from July, many households are comparing short fixed deals against staying on the cap. Use an energy comparison site to check live fixed-rate offers.How to Calculate Your Energy Bill
Your annual bill = (electricity units used × electricity unit rate) + (electricity standing charge × 365) + (gas units used × gas unit rate) + (gas standing charge × 365).
For example, at Q2 2026 cap rates, a household using 3,100 kWh electricity and 12,000 kWh gas pays:
- Electricity: (3,100 × 24.7p) + standing charge = roughly £765 to £990 depending on daily charge
- Gas: (12,000 × 5.7p) + standing charge = roughly £684 to £800 depending on daily charge
- Total: roughly £1,450 to £1,790 (above the typical-use headline because usage exceeds TDCVs)
Energy Cost Calculator
Enter your actual kWh usage or monthly spend to see your exact annual energy costs and potential savings from efficiency improvements.
Energy Support Schemes in 2026
Several government and supplier schemes help households with energy costs:
| Scheme | Who Qualifies | Benefit |
|---|---|---|
| Warm Home Discount | Low-income households on pension credit or qualifying benefits | £150 automatic rebate off electricity bill |
| Cold Weather Payments | On certain benefits when avg temperature at or below 0°C for 7 days | £25 per qualifying 7-day cold spell |
| Winter Fuel Payment | Born before 23 Sep 1958 (and receiving Pension Credit from 2024) | £200 to £300 per winter |
| Energy Company Obligation (ECO4) | Low-income or vulnerable households | Free insulation, boiler replacement |
How to Reduce Your Energy Bills
The price cap protects you from the worst tariff rates, but the best way to cut bills is to use less energy. High-impact actions include:
- Loft insulation: Can save £150 to £300/year for an uninsulated home
- Cavity wall insulation: Saves £100 to £200/year in typical semi-detached
- Smart thermostat: Saves 10 to 15% on heating bills (£100 to £200/year)
- Switching off standby: Saves around £35/year for the average household
- LED lighting: Saves £40 to £60/year replacing all halogen bulbs
- Solar panels + battery: Can offset 50 to 80% of electricity costs
What Will Happen to the Price Cap?
Energy analysts and Cornwall Insight, who publish widely cited predictions for the cap, forecast the Q3 2026 rise to £1,862 based on higher wholesale gas prices. Geopolitical events, extreme weather driving up gas demand, or supply disruptions can shift wholesale prices rapidly, as happened in 2021 to 2022.
Long-term, the UK government's target of a fully decarbonised electricity grid by 2030 and the expansion of offshore wind is expected to reduce electricity unit costs. However, grid infrastructure upgrades and balancing costs may keep standing charges elevated.
Related Calculators
Frequently Asked Questions
The energy price cap is a maximum rate per unit that energy suppliers in England, Wales, and Scotland can charge domestic customers on default tariffs. Set quarterly by Ofgem, it covers the unit rate (pence per kWh) and standing charge (pence per day) for both gas and electricity.
For a typical dual fuel direct debit household, the Ofgem cap is £1,641 a year from 1 April to 30 June 2026. Ofgem has set it to rise to £1,862 from 1 July 2026 on the 2023 benchmark, which is £1,663 on the new typical consumption values that also apply from 1 July 2026.
No. The price cap limits the unit rate and standing charge, not your total bill. If you use more energy than the typical household (2,700 kWh electricity, 11,500 kWh gas), your bill will be higher than the cap headline figure. The cap protects you from excessive per-unit pricing, not total consumption costs.
Yes. Fixed-rate tariffs from energy suppliers can sometimes undercut the price cap, particularly when wholesale prices are expected to rise. Compare tariffs on Ofgem-accredited comparison sites. However, fixed deals carry the risk of being locked in if cap prices subsequently fall.
Under the April to June 2026 cap, average unit rates for a typical household are electricity 24.7 pence per kWh and gas 5.7 pence per kWh. Standing charges are set separately and vary by region and supplier.
Ofgem (the Office of Gas and Electricity Markets) sets the energy price cap for England, Wales and Scotland. It reviews the cap every three months based on wholesale energy costs, network charges, policy costs and supplier operating costs.
Ofgem reviews the energy price cap quarterly, with new rates typically taking effect on 1 January, 1 April, 1 July and 1 October each year. Each review reflects wholesale market conditions over the preceding months.
No. Northern Ireland has a separate regulated market overseen by the Utility Regulator. Domestic electricity and gas prices there are set through a different framework, so the Ofgem cap figures in this guide apply to England, Wales and Scotland only.
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James Hartley is a Chartered Management Accountant (CIMA) with more than eight years of experience in UK tax, payroll and compliance. He holds a BSc in Finance and Economics from the University of Manchester and spent his early career at a Big 4 accounting firm. He founded WhatsUK to build free UK financial calculators and guides verified against official HMRC sources. He authors every calculator and article on WhatsUK.
Sources & Official References
- Ofgem - Energy Price Cap- Official Ofgem cap rates and methodology
- Ofgem - Typical Domestic Consumption Values- 2,700 kWh electricity, 11,500 kWh gas
- Cornwall Insight - Energy Price Cap Forecast- Quarterly cap predictions from leading energy analysts
- Energy Saving Trust - Energy Efficiency- Savings estimates for insulation and efficiency measures
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Disclaimer: This calculator provides estimates based on standard HMRC rates for 2026/27. Results may vary based on individual circumstances. This is not financial advice. Always consult a qualified accountant or CIMA-qualified financial adviser for personal tax matters.