Energy price cap October 2026: what we know so far

Who will be affected by the price cap?

As always, the price cap affects customers on standard variable tariffs. If you’re on a fixed tariff, your costs are fixed and won’t change when the price cap changes. If you haven’t switched energy for more than a year, you’re almost certainly on a price-capped tariff.

If you’re on a prepayment meter but haven’t fixed your tariff, you’ll be subject to the prepayment price cap, which works the same way as the regular price cap.

Middle East effects on UK energy bills continue

The US and Israel’s war on Iran continues to impact UK energy costs. The Strait of Hormuz has not been reopened despite peace talks taking place. This means the oil and gas supply issues that caused the 13% rise in the previous price cap haven’t been solved. This continued disruption almost certainly means the cap will increase again.

VAT cuts

The government’s VAT cut on electricity bills will come into effect on 1 October. This will slightly mitigate the impact of the probable cap rise, but at an average of £45 per year, its impact could be smaller than hoped.

How much will the cap increase by?

Although we usually have a good idea of whether the cap will go up or down, it’s never easy to predict exactly how much it will change. As of 17 August, suppliers are predicting a relatively small increase of just under 3.5%, but we’ll have a better idea when the observation window (the period when Ofgem tracks the market to set the price cap) closes on 18 August.

Bearing in mind that there are currently savings available on fixed deals and it's probable that the cap will stay high over the winter, it could be worth running an energy comparison to see what's available and how much you could save if you're on a standard variable tariff. Click below to get started.