The cost of energy is set to rise from January 1 after Ofgem increased the energy price cap. The energy price cap is the maximum amount energy suppliers can charge you for each unit of energy and standing charge if you’re on a standard variable tariff.
Bills were expected to fall next year, with energy pundits predicting a drop of around £22 a year. Instead, they’re going up, albeit by just £3.36 a year for the average dual fuel user, an increase of 0.2%.
The typical dual-fuel household will now pay £1,758 per year for their energy from January 1, 2026. That’s up from £1,755 based on the cap set on October 1, 2025.
That’s the typical household, however. You can use your current bills to estimate how much your bills will change by using our interactive calculator above.
Tim Jarvis, director general, Markets, at Ofgem, said: “While energy prices have fallen in real terms over the past two years, we know people may not be feeling it in their pockets.
“The price cap helps protect households from overpaying for energy. But it’s only a safety net and there are practical ways that customers can pay less for their energy.
“Look at different tariffs and choose what’s right for you or change the way you pay to Direct Debit or smart pay-as-you-go.
“Prepayment remains the cheapest way to pay, and these customers are already saving around £47 on average.
“While wholesale energy costs are stabilising, they still make up the largest portion of our bills which leaves us open to volatile prices.
“That’s why we’re working with government and industry to boost clean energy and reduce our reliance on international sources we can’t control.”
Kilowatt-hour charges for gas will now be 5.93p, while daily charges will be 35.09p.
Electricity will be 27.69p per Kilowatt hour with a daily standing charge of 54.75p.
