Energy costs are expected to decrease starting in April following the announcement of a new energy price cap by Ofgem. The average annual cost for a typical dual fuel household will be £1,641 from April 1, 2026, down from the previous cap of £1,758 set on January 1, 2026.
Households can estimate their bill changes using the interactive calculator based on their current bills. The price cap determines the maximum charges for unit rates and standing charges, so actual bills may vary from the cap amount.
Gas unit rates are dropping from 5.93p to 5.74p per kilowatt-hour (kWh), with the standing charge decreasing from 35.09p to 29.09p per day. Electricity unit rates are decreasing from 27.69p to 24.67p per kWh, while the standing charge is increasing from 54.75p to 57.21p per day.
Ofgem’s Director General, Markets, Tim Jarvis, highlighted that lower wholesale energy prices and policy cost changes are driving the reduction in energy costs. The aim is to control costs and support long-term energy system stability. Increased competition and switching rates are also observed, with more households opting for cost-saving tariffs.
Jarvis emphasized that the price cap safeguards households but suggests exploring different tariff options for potential bill reductions. Consumers on fixed deals paid less than the cap on average last year, indicating potential savings through alternative tariffs or payment methods.