Morning everyone,
The Ofgem price cap is set to fall by 6.7%, or £117 per year, the largest fall in the last 18 months! This is excellent news, and largely thanks to the Government’s decision to remove government obligations on energy suppliers (which of course means on us). The Government’s decisions should have made it a £150 reduction in our bills, but some of these decisions aren’t being implemented until April 2027!
Either way, I am hopeful this is the start of a consistent reduction in energy bills, I’d love to see us get closer to pre-crisis energy prices again, when a year of gas and electric cost the average household £1,000!
Breakdown of the January 2026 Price Cap Changes
Here is a summary of how standing charges and unit rates are changing for both gas and electric:
| Current (1 Janaury – 31 March 2026) | New (1 April – 31 June 2026) | %age Change | |
| Electricity Standing Charge | 54.75p per day | 57.21p per day | +4.49% |
| Electricity Unit Rate | 27.69p per kWh | 24.67p per kWh | -10.01% |
| Gas Standing Charge | 35.09p per day | 29.09p per day | -17.1% |
| Gas Unit Rate | 5.93p per kWh | 5.74p per kWh | -3.21% |
Again, standing charges of electricity usage has increased – interesting in a world moving toward electrification and energy efficiency, constant increases in the standing charge for electricity.
What is causing the Ofgem Price Cap to drop in April 2026?
A big part of it is the decision by the UK Government to change how certain energy policy costs are paid for. Until now, some of the costs of supporting renewable energy projects and home insulation schemes were added directly onto household energy bills. From April 2026, the government is shifting a chunk of those costs away from bills and into general taxation instead. In simple terms, that means they’ll be paid through government spending rather than through your monthly direct debit — helping bring down the headline figure on bills.
However, there’s a catch. While some elements of the cap are falling, Ofgem has allowed increases in other parts of the bill — particularly network and infrastructure costs. These are the charges that pay for maintaining and upgrading the pipes and wires that deliver energy to your home. As the system modernises and invests in resilience and greener technology, those costs have edged up. The result? The overall drop in the Price Cap isn’t quite as large as many households might have hoped.
The bottom line: April 2026 will bring welcome breathing room for households — just not a dramatic return to pre-crisis prices. It’s a step in the right direction, even if it’s a measured one rather than a leap.
Can I Pay Less for my Energy Bills?
As always, yes. These prices impact people on SVTs, which is around 60% of households, so most of you are missing out on huge savings. It takes roughly 5 minutes to sign up to a new, cheaper tariff.
Today, Uswitch have an exclusive deal from Fuse Energy, not available on any other price comparison sites, coming in at £1,498 per year, that’s £240 cheaper than the current price cap and still £123 cheaper than April’s price cap!
Thanks all,
Richard Winstone
The Regulator Guy.
