UK Energy Cap Falls 7% to £1,641 from April 2026

Millions of UK households will see energy bills decrease starting April 1, 2026, as the Ofgem price cap drops 7 percent to £1,641 annually for a typical dual-fuel household paying by direct debit. The reduction, equivalent to about £117 or £10 monthly, stems from government policies announced in the November 2025 budget, though forecasts warn of a sharp reversal later this year due to escalating Middle East tensions.

The cap, which regulates maximum unit rates and standing charges for standard variable rate tariffs, applies to around 33 million customer accounts, including six million prepayment meters. Unlike typical updates, this quarter's savings will also extend to fixed-rate tariffs because of adjustments to policy-related costs. Households on variable rates, often those not locked into fixed deals, stand to benefit most directly. However, actual bills depend on usage, with Ofgem basing the figure on average consumption estimates of 2,700 kilowatt hours for electricity and 11,500 for gas yearly.

Chancellor Rachel Reeves outlined the cuts in the autumn budget, eliminating the Energy Company Obligation and Renewables Obligation levies, which would have added £150 to bills....