The Ofgem energy price cap for standard variable tariffs fell by 6.6% on 1 April 2026, down to £1,641 a year for a typical dual-fuel household paying by Direct Debit. That is a reduction of around £117 a year, or roughly £10 a month, from the £1,758 cap that applied between January and March.
The cap runs until 30 June 2026. Ofgem will announce the Q3 cap (covering July to September) by 27 May.
The new unit rates and standing charges
For a standard variable tariff customer paying by Direct Debit, averaged across England, Scotland and Wales and including 5% VAT:
| Fuel | Unit rate | Daily standing charge |
|---|---|---|
| Electricity | 24.67 p/kWh | 57.21 p/day |
| Gas | 5.74 p/kWh | Approx 30 p/day |
Actual rates vary by region and payment type. Customers in Southern England typically pay more for electricity than those in the East Midlands, for example, and prepayment meter customers see slightly different figures.
What drove the cut
Three moving parts explain the £117 reduction:
- £150 of policy cost savings — the government has removed the Energy Company Obligation (ECO) levy from bills entirely and moved Renewables Obligation costs into general taxation. This is the biggest single driver.
- £38 of wholesale price falls — wholesale gas prices softened during the observation window that Ofgem used to calculate the April cap, before the Iran conflict began.
- £66 increase in network costs — partially offsetting the savings above. This reflects investment in upgrading the electricity and gas grids under the RIIO-3 regulatory framework.
Warm Home Discount costs have also been shifted from standing charges onto unit rates, which lowers the standing charge and modestly reduces bills for low-use households.
How the cap compares over time
| Period | Annual cap (typical use) |
|---|---|
| Apr to Jun 2025 | £1,849 |
| Jul to Sep 2025 | £1,720 |
| Oct to Dec 2025 | £1,730 |
| Jan to Mar 2026 | £1,758 |
| Apr to Jun 2026 | £1,641 |
Even with the April cut, the cap remains around 30% above real-terms pre-crisis levels. The wholesale cost of gas is still the biggest single component of the typical bill.
Does the cap apply to you?
You are covered by the price cap if you are on a standard variable tariff (sometimes called a default tariff) and pay by Direct Debit, standard credit or prepayment meter. You are not covered if you are on a fixed-rate deal — your contract rates apply until the fix ends.
Should you switch to a fixed deal?
Some suppliers are now offering fixed tariffs that sit below the April cap. Whether one of these makes sense depends on:
- Whether the fix has an exit fee
- How long it lasts
- Your expectations for the July and October caps
- Your usage profile and payment method
Market expectations for the next cap have become more uncertain since the Iran conflict began. Wholesale gas prices rose roughly 75% between late February and late March 2026, which will feed into the May announcement covering the July to September period.
Regional variation matters
The headline £1,641 figure is a nationwide average. Your actual bill depends heavily on where you live because different distribution regions have different network cost allowances. The North Wales and Mersey region, for example, tends to have the highest electricity unit rates, while London often has the lowest. Ofgem publishes full regional breakdowns alongside each cap announcement.
What to do right now
- Check your bill to confirm which tariff you are on and whether the April cap applies.
- Submit a meter reading close to 1 April if you have not already. That locks in the old (higher) rates for all usage before the change and the new (lower) rates after.
- Compare fixed deals with no exit fees or small exit fees against the cap. Even a small undercut can save meaningful money over a year.
- Watch the 27 May announcement for the Q3 cap, which will reflect the post-Iran wholesale market.
Disclaimer: This article is for general information only. Energy tariffs, suppliers and switching rules change frequently. Always check current rates with your supplier or an accredited comparison service before making a decision. Nothing here is a personal recommendation.
Frequently asked questions
When does the April 2026 price cap end?
The cap runs from 1 April to 30 June 2026. Ofgem will publish the Q3 cap (covering July to September) by 27 May 2026.
How much will I save?
A typical dual-fuel Direct Debit household saves around £117 a year, or roughly £10 a month. Your actual saving depends on your usage, payment method and region.
What is the cap if I pay on receipt of bills?
Standard credit customers pay more than Direct Debit customers because of higher servicing costs. The standard credit cap is higher than £1,641 for typical use.
Does the cap apply to fixed tariffs?
No. Fixed-rate tariffs are set by your contract and are not subject to the price cap.
Why did the cap go up in January and then down in April?
The January increase was mainly driven by higher wholesale costs in late 2025. The April cut is driven by a combination of lower wholesale prices (from the pre-Iran observation window) and the removal of certain policy costs from bills.
