Households in England, Scotland and Wales on default energy tariffs will see their bills rise by 4% from October 1, 2026, under the latest price cap set by the UK energy regulator.
The increase, driven by higher wholesale gas prices linked to the Middle East conflict, will apply to standard variable tariffs paid by Direct Debit, standard credit, prepayment meters and Economy 7 meters. Fixed-rate tariff customers will not be affected.
Under the new cap, the average electricity rate for Direct Debit customers will be 26.32 pence per kilowatt hour, with a daily standing charge of 54.83 pence. Gas prices will average 7.97 pence per kilowatt hour, alongside a daily standing charge of 29.68 pence. The regulator reviews and adjusts the price cap every three months, with the next update due by November 25, 2026, covering the period from January 1 to March 31, 2027.
The government will temporarily remove VAT from electricity bills from October 1, 2026 through March 31, 2027, meaning households under the price cap will not pay VAT on power during this period. Gas bills will continue to carry a 5% VAT rate.
The price cap remains below the levels seen during the 2022 energy crisis, when the government set a temporary bill limit of £2,500. The latest adjustment reflects sustained upward pressure on wholesale gas markets amid ongoing regional supply risks.
