| Energy Bills |
Under the October to December 2026 price cap, a typical dual fuel household pays £1,723 per year. This figure is the annual bill for average usage, not a saving. Gas remains cheaper per unit than electricity, but electricity is more efficient for heating.
In 2026, gas is cheaper per unit than electricity, but electricity is more efficient, so the best choice depends on usage and appliance.
KEY FACTS
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LAST REVIEWED 2026-09-06
Is gas cheaper than electricity in the UK?
Yes, gas is cheaper than electricity per unit of energy in the UK. This means electricity is roughly four times more expensive per unit.
The price difference stems from how each fuel is generated, taxed, and delivered. Electricity generation involves complex infrastructure, transmission losses, and higher environmental levies. Gas is a primary fuel, so it avoids many of those costs. However, electricity is more efficient at point of use, especially for heating.
For a typical household, the annual bill under the cap is £1,723 for dual fuel, but this figure is not a saving. It is the total cost for average consumption of 2,500 kWh electricity and 9,500 kWh gas. The actual cost depends on usage patterns and tariff type.
When comparing costs, consider the efficiency of appliances. So, despite higher unit price, electric heating can sometimes be competitive in well-insulated homes.
Check your bill to see your actual unit rates and standing charges, as these vary by region and supplier. The price cap sets a maximum, but many deals are below it.
Gas vs electricity cost comparison: what are the unit rates?
These are the maximum prices suppliers can charge for typical usage.
To compare, calculate the cost of running an appliance. So gas is cheaper for heating.
However, electricity is more efficient for some tasks. An electric heat pump can deliver 3 kWh of heat for 1 kWh of electricity, making it cheaper than gas in many cases. The comparison depends on the appliance's efficiency.
Standing charges also add to the bill. Electricity has a daily standing charge of 54.8p, while gas is 29.7p. These are fixed costs regardless of usage, so they affect low-usage households more.
When comparing, look at your actual unit rates and standing charges on your bill. The price cap is a maximum, not a target, so shopping around can yield lower rates.
| Cap period | Typical dual fuel, Direct Debit | Change | Source |
|---|---|---|---|
| Jul to Sep 2026 | £1,663 | Ofgem | |
| Oct to Dec 2026 | £1,723 | 4% | Ofgem |
| From 1 Jan 2027 | to be announced late November 2026 | Ofgem |
Why is electricity so much more expensive than gas?
Electricity is more expensive than gas due to higher generation costs, infrastructure, and policy levies.
Electricity generation involves fuel, power plants, and transmission networks. Losses occur during transmission and distribution, adding to costs. Environmental and social levies are also applied to electricity, funding renewable subsidies and energy efficiency schemes. These levies are not applied to gas at the same rate.
Gas is a primary fuel, extracted and delivered directly to homes via pipes. Its infrastructure is mature and relatively low-cost. Gas also benefits from lower VAT at 5%, while electricity has a temporary 0% VAT until 31 March 2027, but the underlying costs remain higher.
The price cap reflects these differences. For a typical dual fuel bill of £1,723, the electricity portion is larger than gas, even though gas usage is higher in kWh. This is because electricity's unit rate is higher.
Understanding these factors helps explain why electric heating can be costly, but also why heat pumps, which use electricity efficiently, are promoted as a low-carbon alternative.
Gas boiler vs heat pump: which is cheaper to run in 2026?
In 2026, a gas boiler is generally cheaper to run than a heat pump on a per kWh basis, but a heat pump's efficiency can change the comparison.
A heat pump has a coefficient of performance (CoP) of around 3, meaning 1 kWh of electricity delivers 3 kWh of heat. So gas is still cheaper.
However, heat pump efficiency can be higher in well-insulated homes or with underfloor heating. If the CoP is 4, the cost drops to 6.1p, making it competitive. The actual cost depends on the heat pump's performance and the home's heat loss.
Installation costs also differ. Heat pumps have higher upfront costs, but government grants may offset some. Running costs are only part of the equation.
Check your home's insulation and heating system to estimate which is more economical. The typical dual fuel bill of £1,723 assumes gas heating, so switching to a heat pump would change that figure.
Is electricity cheaper at night?
Electricity can be cheaper at night if you are on a time-of-use tariff, such as Economy 7 or a smart tariff. These tariffs offer lower unit rates during off-peak hours, typically at night, but higher rates during the day.
However, the day rate may be higher than the cap, so the average cost depends on your usage pattern.
To benefit, shift high-energy activities like washing, drying, and charging electric vehicles to night hours. Storage heaters also use night electricity to heat bricks for daytime release.
Compare the total cost on a time-of-use tariff versus a standard tariff. If you use little electricity at night, the higher day rate may outweigh the savings. The standing charge remains the same.
Check with your supplier for available tariffs. The price cap applies to default tariffs, but time-of-use tariffs are often cheaper for those who can shift usage.
What are the standing charges for gas and electricity in 2026?
Under the October to December 2026 price cap, the average standing charge for electricity is 54.8p per day, and for gas it is 29.7p per day. For a dual fuel household, the combined standing charge is 84.5p per day.
Standing charges are fixed daily costs that cover the cost of connecting to the grid, maintaining infrastructure, and other fixed supplier costs. They are paid regardless of how much energy you use.
For a typical household, standing charges make up a significant portion of the bill.
These charges vary by region and supplier, but the cap sets a maximum. Some suppliers offer tariffs with no standing charge, but they often have higher unit rates.
When comparing energy deals, consider both the standing charge and unit rate. A low standing charge may be beneficial for low-usage households, while high-usage households may prefer a lower unit rate.
| Fuel | Average standing charge (Oct to Dec 2026) | VAT / share | Source |
|---|---|---|---|
| Electricity | 54.8p per day | 0% VAT to 31 Mar 2027 | Commons Library |
| Gas | 29.7p per day | 5% VAT | Commons Library |
| Dual fuel | 84.5p per day | 18% of a typical bill | Commons Library |
How do the 2026 price cap changes affect gas and electricity bills?
The price cap for October to December 2026 is £1,723 for a typical dual fuel household, which is a 4% increase from the previous period's £1,663. This change affects both gas and electricity unit rates and standing charges.
The cap is set by Ofgem and applies to default tariffs. The increase is due to rising wholesale energy costs. These are the maximums suppliers can charge.
This means a typical household will pay more each month. The exact impact depends on usage.
From 1 January 2027, a new cap will be announced in late November 2026. This could bring further changes. The VAT on electricity is temporarily 0% until 31 March 2027, which helps reduce costs.
Check your bill to see if your supplier has adjusted rates. The cap is a maximum, so you may be able to find cheaper fixed deals.
How can UK households reduce their energy bills in 2026?
Reducing energy bills involves lowering both usage and costs. Under the October to December 2026 cap, a typical dual fuel bill is £1,723, but households can take steps to reduce this.
Improve insulation to reduce heating needs. Draught-proofing, loft insulation, and cavity wall insulation can cut heat loss. Using a smart thermostat to control heating schedules can also save energy.
Switch to energy-efficient appliances. LED bulbs use less electricity than incandescent ones. Washing clothes at lower temperatures and air-drying instead of using a tumble dryer can reduce electricity use.
Compare tariffs regularly. The price cap is a maximum, but fixed deals may be cheaper. Consider time-of-use tariffs if you can shift usage to off-peak times.
For gas heating, service your boiler to maintain efficiency. Lowering the flow temperature on a combi boiler can save gas. For electric heating, consider using a heat pump if you have the budget, as it is more efficient.
Monitor your usage with a smart meter to identify high-consumption appliances. Small changes can add up to significant savings.
What is the typical annual energy bill for a UK household in 2026?
Under the October to December 2026 price cap, the typical annual dual fuel bill for a household with average usage is £1,723. This is based on a typical domestic consumption value of 2,500 kWh of electricity and 9,500 kWh of gas.
This figure is not a saving or a discount; it is the total cost for a medium-usage household paying by direct debit. Actual bills vary depending on home size, insulation, number of occupants, and heating habits.
The previous cap period, July to September 2026, had a typical bill of £1,663. The cap is reviewed quarterly by Ofgem.
For households using more or less energy, the bill will be higher or lower. The cap limits the unit rate and standing charge, but not the total bill.
To estimate your own bill, multiply your annual kWh usage by your unit rates and add standing charges. The typical figures provide a benchmark for comparison.
Are there any government schemes to help with energy costs in 2026?
Yes, there are government schemes to help with energy costs, but details vary. The Warm Home Discount provides a one-off payment to eligible low-income households, but the amount for 2026 is not yet confirmed.
The Energy Price Guarantee has been replaced by the price cap, which limits unit rates. The temporary 0% VAT on electricity applies until 31 March 2027, reducing bills by about 5% on the electricity portion.
For home improvements, the Boiler Upgrade Scheme offers grants for heat pumps, but the exact amount is not stated here. The Great British Insulation Scheme provides support for insulation, but eligibility criteria apply.
Local councils may offer additional support, such as fuel vouchers or energy advice. Check with your local authority for available programs.
These schemes can reduce bills, but they do not change the underlying cost of gas versus electricity. The typical dual fuel bill of £1,723 is before any such support.
Glossary: the terms on an energy bill explained
Price cap: A limit set by Ofgem on the maximum unit rate and standing charge that suppliers can charge for default tariffs.
Unit rate: The cost per kilowatt-hour (kWh) of energy consumed, which is multiplied by usage to calculate the variable part of the bill.
Standing charge: A fixed daily fee that covers the cost of connecting to the energy network, paid regardless of usage.
Dual fuel: A single energy tariff that supplies both gas and electricity from the same supplier, often with a combined bill.
Typical Domestic Consumption Values (TDCV): Standard annual usage figures used by Ofgem to illustrate typical bills: 2,500 kWh electricity and 9,500 kWh gas.
Coefficient of Performance (CoP): A measure of a heat pump's efficiency, calculated as the ratio of heat output to electricity input.
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Disclaimer. This guide is editorial information drawn from primary sources. It is not financial, legal or tax advice and does not recommend any provider. Figures are those published by the named sources on the review date and may change. Kael Tripton Ltd receives no commission, referral fee or lead payment from any provider named on this page. |
Frequently asked questions
Is gas cheaper than electricity in the UK?
Yes, gas is cheaper per unit than electricity. However, electricity is more efficient at point of use, so the total cost depends on the appliance. For heating, gas is usually cheaper, but a heat pump can be competitive.
Why is electricity more expensive than gas?
Electricity is more expensive due to higher generation costs, transmission losses, and environmental levies. Gas is a primary fuel with lower infrastructure costs. Under the 2026 cap, electricity's unit rate is about four times that of gas. Also, electricity standing charges are higher, at 54.8p per day versus 29.7p for gas.
Is electricity cheaper at night?
Electricity can be cheaper at night if you are on a time-of-use tariff like Economy 7. These tariffs offer lower off-peak rates, but higher day rates. To benefit, shift usage to night hours. Compare total costs before switching.
What is the typical annual energy bill in 2026?
For a typical dual fuel household, the annual bill under the October to December 2026 price cap is £1,723. This is based on average usage of 2,500 kWh electricity and 9,500 kWh gas. The figure is not a saving but the total cost. Actual bills vary by usage and tariff.
How much is the standing charge for gas and electricity?
Under the October to December 2026 cap, the average standing charge is 54.8p per day for electricity and 29.7p per day for gas. For dual fuel, the combined charge is 84.5p per day. These fixed costs are paid regardless of usage and are included in the typical bill of £1,723.
Is a gas boiler cheaper to run than a heat pump?
In 2026, a gas boiler is generally cheaper to run than a heat pump on a per kWh basis. However, a heat pump with a CoP of 3 can deliver 3 kWh of heat for 1 kWh of electricity, making the cost per useful kWh around 8.2p, compared to 6.7p for a gas boiler. So gas is still cheaper, but the gap narrows with higher efficiency.
