| TL;DR: There is no Ofgem price cap on business energy. Business gas and electricity are priced by individual contract, so a firm on out-of-contract or deemed rates can pay far more than any capped domestic rate. Last reviewed July 2026 |
| BUSINESS ENERGY : PRICE CAP |
There is no price cap on business energy in the UK. Ofgem's energy price cap applies only to domestic default tariffs. Business gas and electricity prices are set by individual contracts, so a firm on out-of-contract or deemed rates can pay far more than any comparable capped domestic rate.
KEY FACTS
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Why business energy has no price cap
Ofgem has not extended the price cap to non-domestic supply because business contracts are bespoke. Usage, meter type, contract length and site profile vary widely, so a single typical-consumption figure cannot represent them.
The cap was designed for households on standard variable default tariffs, limiting the unit rate and standing charge they can be billed. Businesses sit outside that mechanism entirely.
What the domestic cap does and does not cover
The cap limits the unit rate and standing charge on domestic default tariffs; it does not cap a household's total bill, which still depends on how much energy is used.
From 1 July 2026 the domestic cap rose by about 13%, with gas rising more than electricity. None of this changes what a business pays, because business rates are not capped.
How business rates are set instead
A business rate is fixed at the point of signing, based on wholesale forward prices, region, meter type and consumption. Wholesale electricity is priced at the margin, usually by gas generation, so business rates track gas market volatility.
If a contract lapses, the supply rolls onto deemed or out-of-contract rates. These are uncapped and typically the highest rates a business can pay.
What protects a business from high prices
The practical protections are contractual: fix rates inside the renewal window, which usually opens one to six months before the contract end date, and avoid rolling onto deemed rates.
Energy-intensive sectors may also access Climate Change Agreement relief and Energy Intensive Industries exemptions on certain non-commodity costs.
Is there any government support now
The Energy Bill Relief Scheme ended on 31 March 2023 and the Energy Bills Discount Scheme that replaced it ended on 31 March 2024. No universal successor scheme is currently running.
Sector-specific relief may still apply, but there is no blanket cap or subsidy on business energy comparable to the domestic price cap.
| Note: The domestic cap resets every three months and figures change; verify the current cap and any government schemes on ofgem.gov.uk and gov.uk before relying on them. |
| RELATED GUIDES |
| Disclaimer: Kael Tripton Ltd is an independent editorial publisher, ICO-registered (ZC135439). This guide is general information, not financial, legal or energy-broking advice, and carries no commission or referral arrangement. Rates and figures are correct as at the review date; verify current figures with the primary sources listed before acting. |
Frequently asked questions
Is business energy capped like domestic energy?
No. The Ofgem price cap covers domestic default tariffs only. Business energy is set by contract and is not capped.
Will the July 2026 price cap change affect my business bills?
No. The cap change applies to domestic standard variable tariffs. A business bill depends on its contract, not the cap.
What are deemed and out-of-contract rates?
These are the default uncapped rates a supplier applies when a business has no agreed contract, and they are usually the most expensive.
Is there a government scheme helping with business energy now?
No universal scheme is running since the Energy Bills Discount Scheme ended on 31 March 2024. Sector-specific relief such as Climate Change Agreements may apply.
| SOURCES |
