Energy price cap explained: October 2026 rates and costs

Bills 6 min read

By the Plug & Penny editorial team · Published 11 November 2026

From 1 October to 31 December 2026, the Ofgem price cap limits electricity to 26.32p per kWh plus a 54.83p daily standing charge, and gas to 7.97p per kWh plus 29.68p a day. These are Great Britain averages for Direct Debit customers. On Ofgem's typical usage they add up to £1,723 a year for a dual-fuel home.

Below we explain both parts of the cap in plain English and show what they mean for everyday appliances. This page covers the October to December 2026 cap and is updated every quarter.

The October to December 2026 cap at a glance

These are Ofgem's national average rates for 1 October to 31 December 2026 (Great Britain, Direct Debit).

The electricity figures carry no VAT. HMRC has set a temporary 0% VAT rate on domestic electricity in Great Britain from 1 October 2026 to 31 March 2027. Gas stays at 5%, and electricity in Northern Ireland stays at 5%.

What the price cap actually limits

Ofgem describes the cap as the maximum a supplier can charge for a unit of energy and a standing charge together. It "does not limit the cost of your total bill". Use more energy, for example in a cold month, and your bill goes up.

The cap only protects people on standard variable tariffs, the default deals whose price can move with the energy market. Ofgem says it does not protect you if you are on a fixed tariff or a business energy contract, or if you get heat from a heat network or use heating oil.

About 35% of households (around 11 million) are on fixed tariffs and are not affected by cap changes. Ofgem updates the cap every three months.

Unit rate vs standing charge: what you pay for

Your bill has two parts for each fuel.

The unit rate is the price per kWh of energy you use. A kWh is 1,000 watts running for one hour. To work out what anything costs:

• watts × hours ÷ 1,000 = kWh
• kWh × unit rate = cost

So a 2,000 W heater running for one hour uses 2,000 × 1 ÷ 1,000 = 2 kWh. At 26.32p per kWh, that is 2 × 26.32p = 52.64p, or about 53p.

The standing charge is a fixed daily amount you pay every day, even on days you use no energy. Ofgem says standing charges recover fixed costs: network costs, meters and some admin.

Here is what the average Direct Debit standing charges add up to under the October to December 2026 cap. A month is a twelfth of a year; the quarter is the 92 days from 1 October to 31 December.

That £308 is paid before you boil a single kettle. The House of Commons Library says standing charges make up 18% of a typical dual-fuel bill under this cap, and about 32% of the electricity bill for a low-use home.

What a typical household pays under the cap

Ofgem turns the rates into a yearly bill using typical usage figures. From 1 July 2026 these are 2,500 kWh of electricity and 9,500 kWh of gas a year for a medium-use home on a standard single-rate meter. Ofgem calls them "an indicative estimate", so your home may use much more or less.

Here is the yearly cost at Ofgem's low, medium and high usage levels. Each line is kWh × unit rate, plus 365 days of standing charge (Direct Debit, GB average, October 2026 rates).

Add the medium electricity and gas lines and you get £1,724, which matches Ofgem's £1,723 headline (the £1 gap is rounding). It annualises this quarter's rates, so it is a guide, not a forecast.

Ofgem lowered these typical usage figures in July 2026. That makes the headline bill look smaller without prices falling: on the old figures, the same cap would read £1,935 a year. Compare your own kWh from your bill, not the headline.

What the cap means for your appliances

The unit rate is the number that matters for each appliance. Every 1,000 W running for an hour costs 26.32p under the October to December 2026 cap. This table shows what common wattages cost at full power.

For appliances that run programmes, the wattage on the plate is not the whole story. The Beko BM3WT3941 washing machine lists 1,750 W of total power, but its energy label says it uses 0.49 kWh per Eco 40-60 cycle. A per-use figure from the manufacturer is the better guide when you have one.

Here is what single uses cost at 26.32p per kWh (October to December 2026):

The kettle figure uses Russell Hobbs' 3000W rating: one minute is 3,000 × (1 ÷ 60) ÷ 1,000 = 0.05 kWh. Time your own boil and multiply. The 90°C wash comes from a Beko programme table for a 9kg machine.

We found no manufacturer or official per-use figure for tumble dryers or ovens, so we have left them out rather than guess. For those, and for a fridge-freezer, the Energy Saving Trust suggests taking the yearly kWh on the energy label and multiplying it by your unit rate.

To work out your own appliance, put its wattage and daily hours into the calculator.

Find your own rates

Everything above uses the Great Britain average for Direct Debit. Your cap rates depend on where you live, how you pay and your meter type, with separate caps in each of 14 regions. Ofgem says regional standing charges differ because of how many people live in the region, how much energy they use, how much energy suppliers need to buy, and the cost of building and improving the network.

To get your real numbers, read the unit rate and standing charge off your latest bill, or pick your region and payment method in Ofgem's rates table. Then put your own unit rate into the calculator above. If you have Economy 7 or another multi-rate meter, your day and night rates are on your bill too.

How you pay matters. Ofgem says prepayment customers pay the lowest cap rates, an average of about £45 less than Direct Debit this quarter.

What changed from the July to September cap

Ofgem announced this cap on 26 August 2026. The typical dual-fuel Direct Debit bill rose by £60 a year (£5 a month), from £1,663 to £1,723, a 4% increase.

Here are the rate changes, from Ofgem's table:

Ofgem says these costs cannot be compared directly with earlier periods, because the July electricity rates included 5% VAT and the October ones do not.

Ofgem puts the rise down to higher wholesale gas prices linked to the conflict in the Middle East. Wholesale prices rose 11% in the three months before the announcement. Gas bills are up 8%, while homes without gas see a rise of less than 1%. Ofgem says the cap would have been about £45 higher without the VAT cut.

When does the price cap change next?

These rates run until 31 December 2026, and Ofgem updates the cap every three months. The January to March 2027 cap is expected to be announced in late November 2026, though Ofgem had not confirmed a date in the pages we used. We will update this page when the new rates are published.

The 0% VAT on electricity is set to end on 31 March 2027, according to HMRC.

How to cut the cost

• Compare fixed deals. Ofgem said fixed tariffs were available at £100 or more below the October cap. Check exit fees and the length of the fix before you switch.
• Boil only what you need. The Energy Saving Trust says this saves £10 a year in Great Britain, and an eco kettle can use 20% less energy than a conventional one.
• Wash on Eco 40-60. In Beko's programme table, a 90°C Cotton wash uses 2.75 kWh against 0.535 kWh for Eco 40-60 on the same 9kg machine. That is about five times the energy: 72p against 14p at October 2026 rates.
• Look at lower standing charge tariffs. Ofgem's one-year lower standing charge pilot started in June 2026, offered first by EDF, E.ON, Octopus and British Gas, with a cap on sign-ups. Ofgem says dual-fuel customers could expect about £150 a year less in standing charges, but it also expects higher unit rates, so these tariffs may not be cheaper overall. Price your yearly kWh at both sets of rates before switching.

FAQ

Can I get a tariff with no standing charge?

Yes. Ofgem says suppliers are not obliged to have a standing charge, and tariffs with no standing charge but a higher unit rate are already on the market. Ofgem also says the costs cannot be removed, only moved into the unit rate.

Do I get the electricity VAT cut on a fixed tariff?

Yes. Ofgem says suppliers apply the discount automatically, including to fixed-tariff customers.

What if my bill covers days before and after 1 October?

HMRC says suppliers may split the VAT by the date you used the energy, using meter readings. Giving your supplier a reading close to 1 October helps it get the split right.

Sources

1. Energy price cap unit rates and standing charges - Ofgem
2. Energy price cap and standing charges explained - Ofgem
3. Energy price cap will rise by 4% from October 2026 - Ofgem
4. Review of typical domestic consumption values: decision - Ofgem
5. Temporary zero rate of VAT for domestic electricity in Great Britain - HMRC
6. Discussion Paper OFG1163 Standing Charges: Call for Input - Ofgem
7. Energy standing charges - House of Commons Library
8. Lower standing charge tariffs: next steps - Ofgem
9. Ofgem confirms plans to introduce lower standing charge tariffs - Ofgem
10. Freestanding 9kg 1400rpm Washing Machine with EnergySpin BM3WT3941 - Beko UK
11. Programme and Consumption Table - Beko user manual
12. Russell Hobbs Calm Quiet Boil Kettle - Russell Hobbs
13. Home appliances and energy efficiency ratings - Energy Saving Trust
14. How our experts save energy in the kitchen - Energy Saving Trust

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