Last reviewed: 30 April 2026
Energy bills for UK households are forecast to rise sharply from July 2026. While the current Q2 cap stands at £1,641 per year for a typical dual-fuel household — down 6.6% from Q1 — wholesale gas prices have surged since the Iran war began, and analysts expect the Q3 cap to climb significantly when Ofgem announces it on 27 May 2026.
Current cap: April to June 2026
The energy price cap for the period 1 April to 30 June 2026 is set at £1,641 per year for a typical household paying by Direct Debit. Unit rates under this cap are:
- Electricity: 24.67p per kWh
- Gas: 5.74p per kWh
- Electricity standing charge: 57.21p per day
- Gas standing charge: 29.1p per day
These figures are national averages across England, Scotland and Wales, inclusive of 5% VAT. Rates vary by region.
July 2026 forecast: what analysts expect
Forecasters, including Cornwall Insight, were projecting a broadly stable or modest rise for July before the Iran conflict escalated oil and gas prices. Updated projections now suggest the July cap could rise to around £1,972 per year — an increase of approximately £331 on the current quarter. This would represent a rise of roughly 20% in a single quarter.
The July cap is calculated using average wholesale gas prices from the assessment period running February to May 2026. Because gas markets surged sharply during this window, those elevated prices are baked into Ofgem's calculation regardless of any subsequent easing. If the Middle East situation stabilises before the assessment window closes on 17 May 2026, the final figure could come in lower than current forecasts suggest.
Should you fix your energy tariff now?
Consumer finance expert Martin Lewis warned in March 2026 that households should "urgently" consider fixing. His rule of thumb at the time: a fix priced up to 11% above the January 2026 cap (around £1,952/year) is likely to save money over 12 months based on current forecasts. However, many of the cheapest fixed deals have since been pulled or repriced higher as suppliers responded to wholesale price spikes.
If you are considering fixing, compare available deals carefully. The case for fixing is strongest if you want bill certainty and can find a deal near current cap levels. The case for staying on the cap is strongest if you believe the Iran conflict will de-escalate significantly before May 17.
When will Ofgem announce the July cap?
Ofgem must announce the Q3 2026 cap by 27 May 2026. The cap applies from 1 July to 30 September 2026.
Energy price cap history (recent quarters)
| Period | Annual cap (typical household) | Change |
|---|---|---|
| Jan–Mar 2026 | £1,758 | +£20 vs Q1 2025 |
| Apr–Jun 2026 | £1,641 | −£117 (−6.6%) |
| Jul–Sep 2026 (forecast) | ~£1,972 | +~£331 (+20%) |
Frequently asked questions
Does the energy price cap limit my total bill?
No. The cap limits the maximum rate per unit of gas and electricity, plus the daily standing charge. If you use more energy than the "typical" household, your bill will be higher than the cap figure.
Who is covered by the energy price cap?
Households on a standard variable tariff (default tariff) in Great Britain who pay by Direct Debit or standard credit. Northern Ireland has a separate regulatory framework and is not covered by Ofgem's cap.
What are the current unit rates?
For Q2 2026: electricity at 24.67p/kWh and gas at 5.74p/kWh (national averages, inclusive of VAT, Direct Debit).
When is the next cap announcement?
27 May 2026, when Ofgem will confirm the Q3 cap applying from 1 July 2026.
Can I get help with energy bills?
The Warm Home Discount scheme provides eligible households with a £150 rebate. Eligibility criteria and application details are available at gov.uk.
Sources: Ofgem — Changes to energy price cap 1 April to 30 June 2026 (25 February 2026) | House of Commons Library CBP-9714 (April 2026) | Ofgem energy price cap explained page | Cornwall Insight Q3 2026 forecasts.
This article is for informational purposes only and does not constitute financial advice. Energy tariff decisions depend on your household circumstances — use an Ofgem-accredited comparison service to find the best deal for your postcode.
