Ofgem Price Cap April 2026: What Your Bill Will Actually Look Like

Quick answer

From 1 April 2026 to 30 June 2026, the Ofgem default tariff cap sets the maximum unit rates and standing charges that a supplier can charge a customer on a standard variable tariff. For the "typical" household using 3,100 kWh of electricity and 11,500 kWh of gas a year, that maps to approximately:

• Annual dual-fuel bill (direct debit): ~£1,690
• Annual electricity-only: ~£900
• Annual gas-only: ~£790

A small reduction from the January 2026 cap, reflecting easing wholesale gas markets through Q1 2026.

What the cap actually caps

The cap is not a cap on your bill total. It's a cap on the rates your supplier can charge:

• A maximum unit rate for each kWh you use (separately for gas and electricity).
• A maximum daily standing charge (a fixed daily cost for being connected to the network).

Both vary by payment method (direct debit is cheapest, prepay slightly higher, pay-on-receipt highest) and by region (14 regional distribution areas, each with different standing charges).

Your actual bill = usage × unit rate + standing charges × days.

If your usage is well below the "typical" household assumption, your bill is lower. If you have an all-electric home with a heat pump and an EV, it can be much higher — even though you're under the cap.

Standing charge restructuring

A long-running political fight has been the standing-charge burden on low-use households (small flats, single-occupant homes). Ofgem's April 2026 cap takes a small step toward rebalancing:

• Daily standing charges drop in most regions.
• Unit rates rise slightly to compensate.

Net effect on a typical household: roughly neutral. Net effect on a low-use flat (say 5,000 kWh gas, 1,800 kWh electricity): slight saving of £15–£40/yr.

Worked example — Sarah in Manchester

Sarah lives in a 2-bed terrace in Manchester, gas-fuelled central heating, modest electricity use:

• Gas: 9,500 kWh/year
• Electricity: 2,400 kWh/year
• Payment: monthly direct debit

Sarah's bill is below the "typical household" figure because her usage is below average — especially on electricity.

Worked example — Liam, all-electric, heat pump

Liam lives in a new-build 3-bed in Sussex, all-electric with an air-source heat pump and an EV:

• Electricity: 9,800 kWh/year (heating + EV charging)
• Gas: 0 kWh

Liam pays £1,000+ more than the typical household total — entirely because he has no gas option and runs heat pump + EV off electricity. A time-of-use tariff (like Octopus Go or Intelligent Octopus) would cut his bill substantially.

Fixed deals vs the cap

At the April 2026 cap, fixed deals on the market range from:

• 2–4% below cap, 12-month fix — common, low-risk.
• 5–8% below cap, 12-month fix — usually with restrictions (e.g. only available with smart meter, or only available online).
• 18–24-month fixes — typically priced slightly above the cap because suppliers price in expected future cap reductions.

Whether to fix depends on:

1. Your view on wholesale gas — if you expect prices to fall further, the cap may keep dropping.
2. Your risk tolerance — a fix gives certainty.
3. Your time horizon — fixed deals usually carry an exit fee.

There's no general right answer; in May 2026 the market consensus is mildly bearish on gas, with cap declines of 5–8% over the next 12 months priced in. A 12-month fix at 3% below cap is roughly neutral against that consensus.

Smart-meter Time-of-Use tariffs

The best deals in 2026 aren't on the cap at all. They're Time-of-Use (ToU) tariffs that charge variable rates by hour:

• Cheap overnight slot (00:30–05:30 typically): 6–9p/kWh
• Standard day rate: 28–32p/kWh
• Peak (16:00–19:00 in some products): 35–42p/kWh

If you can run your dishwasher, washing machine, tumble dryer and EV charging in the cheap slot, ToU tariffs frequently beat the cap by 15–25%. They're only available with a smart meter and require a working DCC connection.

What's not in the cap

Standing charges and unit rates are capped, but:

• VAT (5%) is on top of all numbers above and is set by HMT, not Ofgem.
• Network and policy costs are inside the cap (Ofgem calls them "operational and other direct costs").
• Climate Change Levy does not apply to domestic supply.
• Warm Home Discount (£150) is a separate one-off applied to eligible customers in winter.

Outlook to July 2026

Ofgem's next cap announcement is on 27 May 2026, taking effect from 1 July 2026. Wholesale futures currently imply a further 3–5% reduction at that announcement, taking the typical bill toward £1,610. The October cap is harder to call — winter pricing depends on supply through Q3.

What to do now

1. Take a meter reading on 31 March so your supplier bills correctly across the cap change.
2. Check whether you're on a fix — if it ends mid-cap-period, suppliers usually let you fix again 30 days before end without penalty.
3. If you have a smart meter, consider switching to a ToU tariff.
4. If you're a low-use household, the new standing-charge structure helps you — make sure you're not still on an old fix that locked in higher standing charges.

Sources

• Ofgem: Energy price cap explained
• Ofgem: April 2026 price cap announcement (full publication)
• ONS: Domestic energy prices