Ofgem has announced changes to the maximum amount energy suppliers can charge people on default tariffs for each unit of energy and the daily standing charge.

From 1 January to 31 March 2026 there will be a small monthly increase of 28 pence on the price of energy for a typical household who use electricity and gas and pay by Direct Debit. Year on year when adjusted for inflation the new cap is 2 per cent or £37 lower than the same period in 2025.

Rachel Fletcher, director for regulation at Octopus Energy, said: “The price cap is rising again, driven by costly subsidies for mega projects like Sizewell C and major network upgrades that are adding billions to consumer bills – with no end in sight.


“Let’s be clear: this isn’t about supplier profits, which are capped at ~2 per cent, or renewables. The real issue is our inefficient electricity system burdened by ever-growing policy and network costs that keep stacking up on household bills.


“Instead of paying wind farms not to generate and locking the country into tens of billions of unnecessary grid spending, we need bold market reform. This would save billpayers at least £5bn a year and finally unlock the full potential of our homegrown green energy.”

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