Last updated: Tuesday 22 September 2026 (Europe/London). Cap figures are Ofgem’s published levels for 1 October–31 December 2026.
If you are still on a standard variable tariff (SVT) — the default rate most people land on when a fixed deal ends — the clock to 1 October 2026 matters. That is the day Ofgem’s new dual-fuel price cap of £1,723 a year (typical Direct Debit household) takes effect. It is £60 higher than the July–September 2026 cap of £1,663. Fixed tariffs can sit £100+ below that October headline on a like-for-like typical-use basis, according to Ofgem’s own guidance that you may pay less by changing tariff — but the only honest way to know is a postcode quote for your usage, not a national poster price.
This guide is for the switch season between now and 1 October: what the cap actually is, who it covers, why VAT makes October hard to compare with summer, and a practical framework for deciding whether to fix, leave, or stay. We cite Ofgem throughout. We do not invent regional sample fixes as national live SKUs.
Compare dual-fuel deals on MoneySuperMarket →
What Ofgem confirmed for 1 October–31 December 2026
On 26 August 2026 Ofgem published the default tariff cap for the final quarter of 2026. For a typical dual-fuel household paying by Direct Debit, the annualised bill under the current Typical Domestic Consumption Values (TDCV — 2,500 kWh electricity / 9,500 kWh gas) is £1,723. That is about 4%, or £60 a year (roughly £5 a month), above the July–September 2026 figure of £1,663.
Key Direct Debit national averages (England, Scotland and Wales), from Ofgem’s consumer pages:
- Electricity: 26.32p/kWh unit rate; 54.83p/day standing charge — 0% VAT from 1 October 2026 to 31 March 2027.
- Gas: 7.97p/kWh unit rate; 29.68p/day standing charge — 5% VAT included.
Ofgem is explicit: costs cannot be compared directly with previous periods because of the electricity VAT change. Without the VAT cut, the typical Direct Debit figure would have been around £45 higher. The VAT removal also flows through to fixed tariffs where suppliers apply it automatically.
Payment-method headlines from Ofgem’s summary for the same period (typical annualised bills): Direct Debit £1,723; standard credit £1,861; prepayment £1,678; Economy 7 Direct Debit £1,046 (that last figure is not a “cheap dual-fuel” poster — it is a different meter basis).
Primary sources:
- Ofgem news: Changes to energy price cap between 1 October and 31 December 2026
- Ofgem: Energy price cap unit rates and standing charges
- Ofgem PDF: Summary of changes (1 Oct–31 Dec 2026)
Cap vs considering a fix — facts table (dated Ofgem)
Use this as a qualitative decision aid. Fixed savings of “£100+ below the October cap” are a market observation Ofgem has pointed households towards in spirit (you may pay less by changing tariff); they are not a guarantee for your postcode. Always quote.
| Factor | Stay on SVT / price cap (from 1 Oct 2026) | Consider fixing before 1 Oct 2026 |
|---|---|---|
| Typical dual-fuel DD headline (new TDCV) | £1,723 / year (Ofgem, Oct–Dec 2026) | Market fixes often pitched below that headline; confirm with a live postcode quote — do not treat any national sample £ as your bill |
| Change vs Jul–Sep 2026 | +£60 / +4% on the typical DD figure (£1,663 → £1,723) | A good fix can mute that step-up for the fixed term; exit fees and term length matter |
| Electricity VAT | 0% Oct 2026–Mar 2027 on SVT electricity (Ofgem) | Also applies on many fixed deals (supplier applies the cut) — still check the quote breakdown |
| Gas VAT | 5% included in Ofgem gas rates | Usually still present; compare unit rates, not marketing slogans |
| Who it covers | Default tariffs: DD, standard credit, prepay, Economy 7 | You leave the default if you switch to a fixed (or other non-default) deal |
| What actually changes on 1 Oct | Maximum unit rates and standing charges suppliers can charge on defaults | Your fixed unit rates stay as contracted (subject to the deal’s terms and VAT rules) |
| January 2027 | Next Ofgem announcement due by 25 Nov 2026 for Jan–Mar 2027 — treat any £ rise talk as forecast only until published | A fix can bridge winter; do not buy a story about January £ figures that Ofgem has not published |
| Action before 1 Oct | If you do nothing on an SVT, new cap rates apply automatically | Compare, switch, or fix in time for the start date you want — switches are not instant |
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Why “fix before October” is a real deadline — and what it is not
The price cap is a ceiling on default unit rates and standing charges, not a promise that every home costs £1,723. Use more energy, live in a higher-standing-charge region, or pay on standard credit, and your bill diverges. “Fix before October” means: if you want contracted rates that are not dragged up by the new default ceiling on day one, you need to be off the SVT (or onto a better deal) with enough lead time for the switch to complete.
It is not a claim that every fixed deal is cheaper, that January 2027 is already decided, or that a Twitter screenshot of someone else’s Bristol quote applies in Glasgow. Ofgem’s next formal level announcement for January–March 2027 is scheduled by 25 November 2026. Until then, any January pound figure you see elsewhere is a forecast, not a regulatory decision.
Who should treat this as urgent
- SVT / default customers — You take the October rates unless you move. That is the core switch-season audience.
- People coming off a fixed deal in late September or early October — Rolling onto SVT on the wrong day can mean an immediate step onto the new ceiling.
- Prepay and standard credit customers — Different typical headlines (£1,678 and £1,861 in Ofgem’s summary) but the same logic: defaults move with the cap; a better tariff or payment type can still beat inertia.
- Already fixed with no exit fee (or a tiny one) — You can still shop; the urgency is optional, not existential.
- Already fixed with a painful exit fee — Run the numbers. Sometimes waiting out the term is cheaper than paying to leave, even if the open market looks attractive.
A simple decision framework (not financial advice)
Step 1 — Confirm your tariff type. App, bill, or supplier chat: are you on a fixed deal or a default/SVT?
Step 2 — Pull 12 months of usage if you can. Smart meter data beats TDCV fairy tales. If you only have estimates, use them — still better than assuming you are “typical”.
Step 3 — Quote fixed and variable options for your postcode. Look at unit rates, standing charges, exit fees, and term length. Ignore “save £X vs the cap” badges until you have rebuilt the maths on your kWh.
Step 4 — Decide on risk tolerance. Fixing buys rate certainty through winter. Staying on SVT keeps flexibility if wholesale prices fall and Ofgem’s next level drops — but October is a rise, and January is unknown until late November.
Step 5 — Switch with calendar buffer. Do not leave it to 30 September at 11pm and expect a same-day miracle.
VAT, gas, and why the +4% feels oddly muted
Gas did the heavy lifting in the wholesale story; electricity’s standing charge actually eased on the national average (57.19p/day in Jul–Sep to 54.83p/day in Oct–Dec on Ofgem’s Direct Debit table), and electricity VAT drops to 0%. That mix is why a raw “prices are exploding” headline and a “only £5 a month” headline can coexist. Ofgem attributes the rise primarily to higher wholesale gas prices linked to Middle East conflict, while stressing bills remain well below the 2022 crisis peak when government support capped typical bills at £2,500.
If you heat with gas, feel the unit-rate jump (7.33p → 7.97p/kWh on the national DD average). If you are electric-heavy or all-electric, the VAT cut does more work for you — but standing charges still tick every day you are connected.
What we will not do in this article
- Invent Nest energy product IDs or present regional sample fixed pounds as national live SKUs.
- Treat January 2027 £ forecasts as Ofgem fact.
- Send you to Switch’s own energy hub as the primary button — for home energy compare we use MoneySuperMarket via Awin (merchant 22713, affiliate 911601).
Compare energy deals on MoneySuperMarket →
Related Switch reading
- Energy price cap October 2026: Ofgem sets £1,723, up 4% — full announcement deep-dive
- VAT on electricity UK from 1 October 2026
- Economy 7 October 2026 price cap
- Should I fix my energy deal or stay on the price cap?
FAQ
| Question | Answer |
|---|---|
| What is the Ofgem dual-fuel price cap from 1 October 2026? | Ofgem set a typical Direct Debit dual-fuel annualised bill of £1,723 for 1 October–31 December 2026 on the current TDCV (2,500 kWh electricity / 9,500 kWh gas). That is £60 (+4%) above the July–September 2026 typical figure of £1,663. |
| Does the price cap mean my bill will be exactly £1,723? | No. £1,723 is a typical-use communication figure. Your bill depends on how much you use, your region’s standing charges and unit rates, your meter, and how you pay. |
| Should SVT customers fix or leave before 1 October? | If you remain on a default tariff, the new capped unit rates and standing charges apply from 1 October. Many households will want to compare fixed deals before then; whether fixing wins depends on your quote, exit fees, and risk tolerance. Get a postcode quote rather than relying on national averages. |
| Is VAT really 0% on electricity? | Yes for domestic electricity from 1 October 2026 to 31 March 2027, per Ofgem and government policy. Gas still carries 5% VAT in the published gas cap rates. |
| Can fixed tariffs beat the October cap by £100+? | Ofgem notes you could pay less by changing tariff. Market commentary often cites fixes £100+ below the October typical headline on a like-for-like basis — treat that as a prompt to compare, not as your guaranteed saving. Live prices need a postcode quote. |
| Has Ofgem confirmed January 2027 prices? | No. The next announcement is due by 25 November 2026 for the 1 January–31 March 2027 period. Any January £ figure circulating now is a forecast only. |
| Where should I compare home energy deals from this page? | Use MoneySuperMarket’s gas and electricity compare journey via our Awin affiliate link (merchant 22713, affiliate 911601). That is the primary CTA for this guide. |
Editorial note: Switch Editorial Team. Figures checked against Ofgem’s 26 August 2026 publications. Affiliate disclosure: some links are sponsored MoneySuperMarket links; we may earn a commission if you switch after clicking, at no extra cost to you.
