Energy bills from 1 October: electricity at 26.32p per kWh, 0% VAT — and why you should submit a meter reading today

Ofgem reviews the price cap every three months, and from 1 October to 31 December 2026 the new level applies: £1,723 a year for a typical dual-fuel household paying by direct debit. That is about £60 a year — 3.6% — more than the July level (Ofgem rounds it to 4%).

The new rates

The cap limits the price of a unit of energy and the standing charge, not your total bill. Averaged across England, Scotland and Wales for direct debit customers, from 1 October electricity costs 26.32p per kWh with a 54.83p daily standing charge, and gas 7.97p per kWh with a 29.68p daily standing charge. The figures vary slightly by region — you can check the exact ones for your address on Ofgem's website or in your supplier's app.

Ofgem's own wording is worth keeping in mind: "It does not limit the cost of your total bill. The more energy you use, the higher your bill will be."

Why electricity barely moved

Most of the increase fell on gas. Electricity was held down by zero VAT: from 1 October 2026 to 31 March 2027 the government has cut VAT on electricity — both unit rates and standing charges — from 5% to 0%. Without that measure the cap would have risen by around 6% rather than 3.6%. VAT on gas stays at 5%.

What to do today: meter readings

If you have a traditional meter without smart data, submit a reading to your supplier today or within the next day or two. Everything you used before 1 October will then be billed at the old summer rates, and only what you use from now on at the new ones. Without a reading, the supplier will split your usage by estimate, and some of your September units may end up priced at October rates. With a smart meter there is nothing to do. Citizens Advice gives the same advice when changing supplier: take a meter reading on the day of the switch.

Who the cap covers — and who it doesn't

The cap protects households on a standard variable tariff — the default you end up on if you never picked a tariff or your fix has ended. Fixed tariffs are not covered: their prices are written into the contract. Right now the cheapest fixes undercut the new cap — we are publishing a detailed look at whether to fix this autumn today: should you fix your energy tariff.

What comes next

Ofgem will announce the next cap level — for January to March 2027 — in late November. Forecasts are not encouraging: in late September MoneySavingExpert put the predicted January rise at around 20%, while stressing that this is "crystal-ball gazing" and depends on wholesale prices over the coming weeks.

If bills are already heavy, check what you are entitled to: the £150 Warm Home Discount reaches almost everyone automatically this year, and pensioners get the Winter Fuel Payment of £100–£300.