Energy Price Cap Update:
Ofgem has confirmed that the energy price cap will rise by 13.5% from 1 July 2026, increasing the annual cost for a typical dual‑fuel household by £221.
What is causing the increase?
Gas remains the main driver of the July rise. Gas unit rates are increasing by 28% on the previous quarter, linked to disruption in global energy markets following the ongoing conflict in the Middle East, now more than 100 days on. Prices are also 16% higher than this time last year, reflecting continued volatility and the UK’s exposure to international fossil fuel markets.
According to the End Fuel Poverty Coalition, average household bills are now 79% higher than before the energy crisis began in winter 2020/21. They estimate that the cumulative extra cost to households since 2021 is around £4,800, showing the long‑term impact of sustained high prices.
What is an Energy Price Cap?
The energy price cap sets a limit on how much suppliers can charge for each unit of gas and electricity you use under standard variable tariffs. When the cap increases, energy bills rise, but it ensures customers aren’t charged excessively high rates.
If you’re on a fixed deal, this change will not affect you.
To see how this will affect your energy bill you can use the Money Saving Expert – Energy Price Cap Calculator here!
Thinking about switching:
The latest advice from Martin Lewis, The Money Saving Expert, can be found here, including a ‘should you fix?’ calculator.
Before switching, we recommend you consider the following:
- Exit Fees: Check for any exit fees and think about opting for a longer-term fix to protect against price fluctuations.
- Customer Service: Evaluate the level of customer service you receive.
- Household Usage: Consider your household’s energy usage—whether it’s heavy (e.g., multiple occupants) or low (e.g., single occupancy).
- Current Supplier Rates: Contact your current supplier to enquire about the best rates they can offer, and compare these with those of other suppliers.
Remember, always take the final meter reading before you switch, even if you have a smart meter, or are on a prepayment meter. If you are on an Economy 7 tariff you will need to take both day and night meter reads.
If you need help with switching suppliers or energy related advice then please get in touch here
Direct Debits
Spring and early summer can be a good time of year to check the balance on your account with your energy company.
Through the spring and summer you would expect to be building up a credit balance whilst usage is less, which should then be used up through the autumn, winter and early spring.
If you have a significant credit balance, you may want to contact your energy supplier and ask for some of this to be returned. Do bear in mind, when considering this, that there may be further increases to tariffs in October, depending on how global oil and gas prices change.
It is also worth checking your account regularly, as suppliers may adjust Direct Debits in response to rising wholesale costs.
Support
If you are worried about rising fuel bills or the winter ahead, please don’t struggle alone. You can contact us for free and impartial advice, and we can help you understand your options and the support available.
If you would like to speak to someone directly, you can get in touch by email, by phone, or by completing our online form here.
Sources
- End Fuel Poverty Coalition – The Iran Conflict: 100 Days and Counting
- End Fuel Poverty Coalition – Energy Bills to Rise by 13.5% as Households Warned of Difficult Winter Ahead
- End Fuel Poverty Coalition – Ofgem Price Cap
- MoneySavingExpert – What Is the Energy Price Cap?