Energy bills jumped in July, and could be staying high for the rest of the year.
While early energy price cap predictions may change, it’s clear that energy prices remain unpredictable.
If you’re one of the millions of households in England, Scotland or Wales on a standard variable tariff, what you pay is controlled by the Ofgem energy price cap. Because it changes every three months, it’s important to understand how energy price cap predictions for the remainder of 2026 could affect your bill.
What Is the Energy Price Cap?
The energy price cap, set by Ofgem, is the maximum amount energy suppliers can charge you for each unit of energy and for standing charges if you’re on a standard variable tariff.
The Ofgem price cap is designed to make sure prices are fair and reflect the cost of energy.
It doesn’t cap your total bill. This still depends on the amount of energy being used.
You are covered by the price cap if you have a single rate or a multi-rate tariff, like Economy 7 (E7) and pay for electricity or gas bill by either:
- standard credit (payment made when you get your electricity and gas bill)
- Direct Debit
- prepayment meter
The Ofgem price cap is updated every three months. Ofgem calculates this by combining wholesale and non-wholesale costs such as network costs, operating costs and policy costs.
What Is the Current Energy Price Cap?
Ofgem has updated its Typical Domestic Customer Values from the 1 July, to reflect that households are using less energy than previously – around 7% less electricity and 17% less gas compared to the last review.
Under the old TDCVs, the 1 July to 30 September price cap for a typical household that uses electricity and gas and pays by Direct Debit would have been £1,862. Under the new TDCVs, the price cap is set at £1,663.
That new figure is still an increase of 13% compared to the energy price cap of £1,477 set between 1 April to 30 June 2026 (or £1,641 under the old TDCVs).
Average rates are:
- electricity: 26.11p per kWh, plus 57.19p daily standing charge
- gas: 7.33p per kWh, plus 29.04p daily standing charge
Rates vary slightly depending on where you live, how you pay your bill and the type of meter or tariff you have.
You can find the Ofgem price cap standing charges and unit rates by region here.
Energy Price Cap Predictions: October 2026 Forecast
Cornwall Insight’s energy price cap predictions from 21 July suggest that the October – December price cap for a dual-fuel household using a typical amount of gas and electricity could rise slightly to £1,699.58, based on the new TDCVs.
However, energy bill forecasts remain uncertain. The Department for Energy Security and Net Zero has warned that using short-term wholesale movements for energy price cap predictions is “not reliable.”
Cornwall Insight is currently updating its energy bill forecasts for the October price cap weekly due to ongoing instability in global energy markets.
The final October price cap will be based on wholesale prices between mid-May and mid-August. These could fall if markets stabilise or rise further if disruption continues.
We’ve seen this pattern before. Prices surged after COVID-19 lockdowns lifted in 2021, spiked again during the Russia–Ukraine conflict, and peaked over the winter of late 2022 and early 2023. While prices have eased since then, many households are still paying significantly more compared to pre-crisis levels.
Why Are Energy Prices Still High in October 2026?
Energy prices are driven by global supply and demand, and right now, that picture is unstable again.
Wholesale energy prices have climbed sharply in recent months due to tensions in the Middle East.
Gas plays a key role in generating electricity in the UK, so when gas prices rise, electricity prices follow. However in July. a smaller price increase of around 5% was seen on electricity prices compared to gas which rose by 24%, this reflects the increase in the amount of renewable generation on the system and therefore reduced reliance on gas to generate our electricity.
At the same time, network costs are expected to rise in coming years. Together, these pressures result in higher energy bills.
When Will Ofgem Announce the October Price Cap?
We’ll see more energy price cap predictions in the coming weeks.
However, Ofgem will confirm the next energy price cap for households on 26 August 2026.
This will set the rates for October through to December.
What Does a Typical UK Energy Bill Look Like?
Understanding what makes up a typical energy bill in the UK can help you make sense of rising costs.
A typical energy bill in the UK is mainly made up of:
- the unit rate, which is what you are charged for each kWh used, the total depends on how much energy you use
- the standing charge, a fixed daily amount for your connection to the grid, regardless of energy usage
These charges cover costs such as:
- wholesale costs: the price suppliers pay for energy on the market (the biggest portion of your bill)
- network costs: charges for transporting energy through pipes and cables, maintaining infrastructure and balancing supply and demand
- environmental and social levies: government mandated costs that fund energy policies such as renewable energy and energy efficiency schemes and support programmes like the Warm Home Discount
- other direct costs: including meter maintenance, the smart metering rollout and industry systems that manage energy data
- operating costs and profit margin: customer service, billing, administration and a small supplier profit
VAT is then added to the total. For domestic customers this is typically at 5%.
Average annual costs
- average UK electricity bill as of July 2026: £652.75 per year (based on unit usage only and excluding standing charges)
- average UK gas bill as of July 2026: £696.35 per year (based on unit usage only and excluding standing charges)
Average annual dual-fuel energy bill by household size
- 1–2 bedrooms: £1,172.30 per year (£97.69 per month, including standing charges)
- 3–4 bedrooms: £1,663.84 per year (£138.65 per month, including standing charges)
- 5+ bedrooms: £2,332.12 per year (£194.34 per month, including standing charges)
Will the Government Provide Bill Support?
With bills expected to rise again, pressure is growing for further support. StepChange estimates that around 24 million people are worried about paying their energy bills between April and October 2026.
At the moment, there’s no universal support package like the one introduced during the energy crisis in 2022, following Russia’s invasion of Ukraine.
Instead, future help is likely to be targeted at lower-income households. Chancellor Rachel Reeves recently confirmed that support with gas and electricity bills would be targeted at “those who need it most”.
Longer term, the government is looking at changing how electricity is priced. The aim is to reduce the impact of volatile gas markets and better protect households from high energy bills triggered by spikes in gas prices. European countries like Spain and France are not as vulnerable to gas price spikes because they are not as reliant on it for electricity.
- moving some older, clean energy projects – which account for about one-third of Britain's electricity generation – onto fixed-price contracts
- increasing the windfall tax on some electricity generators, with a view to supporting households with the cost of living
The aim is to make bills more stable over time, but these changes, if they happen, won’t have an immediate impact on costs this year.
What Can Households Do to Reduce Their Bills?
Faced with daunting energy price cap predictions, the key is to focus on changes that make a difference without putting your household at risk.
Start with support
If you’re struggling to pay your energy bills, the first thing to do is contact your supplier. Ofgem’s rules mean they must work with you to agree on a payment plan you can afford.
They may also be able to point you towards grants or schemes that can help you reduce energy costs, pay off energy debt or make energy-saving improvements to your home.
You can also check with your local council for additional support with rising energy costs in your area.
The organisations listed on this page can support you with energy costs and help you find out what financial support you may be entitled to.
Across the UK there are various government schemes which you may be eligible for. These differ depending on where you live:
- Winter Fuel Payment: between £100 and £300 to help you pay your heating bills.
- Cold Weather Payment: £25 for each 7-day period of very cold weather between November and March each year.
- Warm Home Discount: a one-off £150 discount off your electricity bill, re-opening again in October 2026.
If you need help with energy bills, learn more about support schemes, discounts and advice here.
Reduce usage where it counts
Not all energy savings are equal:
- heating and hot water typically account for the largest share of energy use
- small changes can help, but cutting back too far can affect your health and safety
For practical ways to reduce your usage safely, read our guide on how to save money on your energy bills in 2026.
Pay smarter
Paying by Direct Debit can save you 5–10% compared to paying quarterly.
Consider switching carefully
Some households can save hundreds on energy bills by switching to a cheaper supplier or tariff, but timing is important.
Right now:
- many fixed deals have become more expensive or disappeared altogether
- prices are volatile, so the cheapest deal today isn’t always the best long-term option
If markets stabilise, cheaper fixed deals could return. If volatility continues, fixing now could offer certainty but you may pay a premium.
There’s no one-size-fits-all answer. It depends on how much risk you’re comfortable with.
Invest in efficiency if possible
- loft, wall and floor insulation helps keep the heat in
- solar panels reduce reliance on the grid
- draught-proofing is one of the cheapest and quickest ways to save money on energy bills
Read our guide on home energy saving improvements to explore your options.
Always stay energy safe
When energy price cap predictions look high, some people feel pressure to take risks to try and lower costs. This can include tampering with energy meters or bypassing them completely, so they don’t record energy usage accurately.
Never be tempted to tamper with your meter or energy supply. It’s illegal and extremely dangerous.
You can learn more about the dangers of electricity theft here, and read terrifying real-life stories of energy theft here.
If you suspect energy theft, report it 100% anonymously to Stay Energy Safe by filling out the simple online form or calling 0800 023 2777.
If you’re struggling, the safest option is to seek support. Don’t take risks that could put your home or family in danger.