First published: 4 March 2026 -

Last updated: 4 March 2026 -

Energy Price Cap explained – support to keep bills low

We’ve teamed up with Energy Saving Trust to give you everything you need to know about, what the energy price cap is, what it means for your bills and how to cut your energy costs at home.

If you’re worried about paying your energy bill, you’re not alone: homes across Wales are feeling the pinch. The energy crisis, driven in part by Russia’s invasion of Ukraine in 2022, saw energy prices spike. Even for January to March 2026, the annual dual-fuel energy bill for a typical home is over £500 more than in winter 2020-21.

But there’s a maximum amount that your energy supplier can charge you for each unit of gas or electricity you use. This is called the energy price cap.

We’re here to explain what the energy price cap is and what it means for you and your energy bills.

What is the energy price cap?

The energy price cap limits the maximum amount an energy supplier can charge you for each unit of gas and electricity you use.

The price cap includes:

Standing charge: a daily fixed amount you must pay regardless of how much energy you use.
Unit price: the price of each unit of gas and electricity you use in pence per kilowatt hours (p/kWh).

Ofgem, the UK’s energy regulator, sets the price cap to protect people from a ‘loyalty penalty.’ With many homes not readily switching suppliers to get the best deal, some energy companies pushed up their prices. Introducing the price cap limited what suppliers could charge.

Ofgem updates the price cap every three months. The current price cap for 1 January to 31 March 2026 is:

Electricity: 27.69p per kWh; 54.75p daily standing charge
Gas: 5.93p per kWh; 35.09p standing charge

How does the price cap affect your energy bills?

The energy price cap limits the amount energy suppliers can charge for their default tariff, which is the most basic tariff they offer. Often this is a ‘standard variable’ tariff, where amount you pay per unit changes.

The price cap applies to these default tariffs – it doesn’t matter how you pay your bills (direct debit or with a pre-payment meter, for example).

The current price cap makes an energy bill for a dual-fuel home with typical usage in Great Britain who pay by direct debit around £1,758. If you’re on a pre-payment meter, it’s around £1,711. If you don’t pay by direct debit or with a pre-payment meter but pay when your bills arrive, then it works out around £1,894.

Ofgem has confirmed that the price cap for 1 April to June 2026 will fall by 7%. This will make energy bills for a dual-fuel home with typical usage in Great Britain who pay by direct debit around £1,641. For pre-payment meters, it’ll be £1,597. And if you pay when the bill arrives, it’ll be £1,772.

But remember: this isn’t the maximum total amount that you’d pay as the price cap applies to the unit price of electricity and gas. You pay for the amount of energy you use, so your energy bill could be higher or lower than these amounts.

What about other tariffs?

The energy price cap doesn’t apply if you’re on a ‘fixed’ tariff, where the price you pay per unit is fixed for the contract. It also doesn’t apply to some other tariffs, such as green tariffs or time of use tariffs.

Not sure what tariff you’re on? Check your energy bill or speak to your energy supplier.

Energy Saving Trust has a guide to help you find the best tariff.

Why are energy prices still high?

The energy price cap is influenced by different things. Wholesale gas prices can be affected by global events (such as Russia’s invasion of Ukraine). This can then influence the price of electricity. This is because electricity prices are set by the most expensive energy source used to meet the country’s energy demand – typically a gas power station.

But the price cap also considers ‘non-wholesale costs’ such as:

Costs for maintaining the grid.
Investment in renewable energy.
Supporting vulnerable households.

Organisations like Cornwall Insight use these factors to make price cap predictions, but it’s Ofgem who sets the actual price cap.

In 2025, the energy price cap stayed relatively stable. Bills in 2025 based on the price cap stayed between £1,700 and £1,900. While Ofgem has confirmed that the price cap will fall 7% in April 2026, estimates suggest that it’s expected to stay roughly the same until the end of the year according to MoneySavingExpert.

Ways to save money on your energy bills

No matter what the energy price cap is, there are things you can do right now to lower your energy bills.

Struggling to pay your energy bill?

If you’re worried about paying your energy bill, it’s important to ask for help as early as you can. Remember: there is help available.

First, speak to your energy supplier as soon as you can. Ofgem’s rules means they must work with you to set up a payment plan you can afford.

You can also check if you can get financial help to pay your energy bills. This might be through the Fuel Direct Scheme or by getting a fuel voucher (if you’re on a pre-payment meter).

Citizens Advice has a helpful guide on what to do if you’re struggling to pay your energy bill.

Tips to reduce your energy bills at home

Small changes can make a big difference. As well as helping lower your bills, you can also lower your carbon footprint by:

Switching devices off standby.
Avoiding overfilling the kettle when making a cuppa.
Only spending four minutes in the shower.
Running fewer laundry cycles and using a colder temperature.

Get more quick tips to save energy from Energy Saving Trust. These tips can help you save up to £351 a year on your energy bills.

Free expert energy advice from Nest

The Welsh Government Warm Homes Nest scheme can also help. Nest provides free, impartial energy advice to help you lower your energy bills and improve your health and wellbeing.

Nest can also help you find out if you can get free home energy efficiency improvements like:

Since 2011, over 60,000 homes in Wales have had free home energy improvements from Nest. Even if you’re not eligible, the team can help find other home energy grants you might be entitled to.

They can help you find the best tariff and make sure you’re getting the benefits you’re entitled to. You can also get advice on cutting your carbon footprint.

Get free home energy advice and support from Nest.

Want more advice on saving energy at home?

Explore our energy saving tips and how to reduce energy while cooking for more everyday tips that make a difference.