Energies

Energy Price Cap October 2026 — What You'll Pay

How the Ofgem energy price cap works, what it means for your bills from October 2026, and how to reduce your energy costs. UK guide.

By PocketWise · · 4 min read

The Ofgem energy price cap determines what you pay for gas and electricity on a default or variable tariff. Here is how it works, what to expect from October 2026, and what you can do about it.

How the Price Cap Works

Feature Details
What it caps Maximum unit rates (per kWh) and daily standing charges
Who it applies to Customers on default, variable, or deemed tariffs
Who it does not apply to Fixed-rate tariff customers (until their fix ends)
How often it changes Every quarter (January, April, July, October)
Who sets it Ofgem (the energy regulator)
Based on Wholesale energy prices, network costs, supplier operating costs, policy costs

What the “Typical” Household Means

Metric Amount
Typical annual electricity use 2,700 kWh
Typical annual gas use 11,500 kWh
Fuel type Dual fuel (gas and electricity)
Payment method Direct debit

The price cap figure (e.g. “£1,800 per year”) is for this typical household. Your bill will differ based on your actual usage.

Recent Price Cap History

Quarter Annual cap (typical household) Gas unit rate Electricity unit rate Gas standing charge Electricity standing charge
Jan–Mar 2025 £1,738 6.76p/kWh 24.50p/kWh 32.20p/day 61.64p/day
Apr–Jun 2025 ~£1,720 ~6.60p/kWh ~24.40p/kWh ~32p/day ~61p/day
Jul–Sep 2025 ~£1,700 ~6.50p/kWh ~24.30p/kWh ~32p/day ~61p/day
Oct–Dec 2025 ~£1,750 ~6.70p/kWh ~24.50p/kWh ~32p/day ~61p/day
Jan–Mar 2026 ~£1,780 ~6.80p/kWh ~24.60p/kWh ~32p/day ~61p/day
Apr–Jun 2026 ~£1,760 ~6.70p/kWh ~24.50p/kWh ~32p/day ~61p/day
Jul–Sep 2026 To be announced TBA TBA TBA TBA
Oct–Dec 2026 To be announced TBA TBA TBA TBA

Figures shown are illustrative. Check Ofgem’s website for confirmed rates closer to each quarter.

What the October 2026 Cap Might Be

Factor Direction
Wholesale gas prices Volatile — depends on global supply and demand
Wholesale electricity prices Linked to gas (gas sets the marginal price)
Network charges Gradually increasing due to infrastructure investment
Policy costs (renewables obligations, WHD, etc.) Relatively stable
Supplier margin Small (~2% of bill)

Market forecasts suggest the cap will remain in the £1,700–£1,900 range for October 2026, but wholesale price movement could push it higher or lower.

Your Options

Stay on the Price Cap (Default Tariff)

Pros Cons
Adjusts quarterly — benefit if prices fall Exposed to increases every quarter
No exit fees No price certainty
Protected by Ofgem regulation Unit rates may be higher than best fixed deals

Fix Your Energy Tariff

Pros Cons
Price certainty for 12–24 months May miss out if prices fall
Can lock in below-cap rates when available May have exit fees (check terms)
Peace of mind Must actively search and switch

When to Fix

Situation Recommendation
Fixed deal below current cap Consider fixing — you are getting a discount
Fixed deal above current cap Stay on cap for now and review next quarter
You want certainty and budget predictability Fix
You believe prices will fall further Stay on cap (variable)

How to Reduce Your Energy Bill Regardless of the Cap

Quick Wins — No Cost

Action Typical annual saving
Turn thermostat down 1°C £80–£100
Use washing machine at 30°C £15–£25
Turn off standby devices £40–£65
Only fill kettle with what you need £10–£15
Swap to LED bulbs £30–£60
Reduce shower time by 1 minute £15–£25
Close curtains at dusk in winter £10–£20

Investments — Upfront Cost with Payback

Action Cost Annual saving Payback
Loft insulation (270mm) £300–£600 £150–£250 2–3 years
Cavity wall insulation £500–£1,500 £150–£300 2–5 years
Smart thermostat £150–£250 £75–£150 1–3 years
Draught proofing £100–£300 £30–£60 2–5 years
Double glazing £4,000–£8,000 £75–£150 25+ years
Solar panels (4kW) £5,000–£8,000 £300–£700 8–12 years

Understanding Your Bill

Bill element What it is % of bill
Wholesale costs The cost of gas and electricity on the market ~40%
Network costs Maintaining pipes and wires that deliver energy ~25%
Operating costs Supplier costs to serve you ~15%
Policy costs Government schemes (renewables, WHD, ECO) ~10%
VAT (5%) Tax on energy bills ~5%
Supplier margin Profit ~2%

Help With Energy Bills

Support What it provides
Warm Home Discount £150 off electricity bill
Winter Fuel Payment £100–£300 for State Pension age residents
Cold Weather Payment £25 per 7-day cold spell
Supplier hardship funds Grants to clear energy debt
ECO4 Free insulation and heating improvements
Council welfare funds Emergency payments for energy costs

Related guides:

Sources

  1. Ofgem — Energy price cap