Ofgem Price Cap Extended to 2027: What It Means for Your Bills
The energy price cap remains frozen through winter 2026. Here's how to check if you're on the best deal and what to expect next.
The Office of Gas and Electricity Markets (Ofgem) has confirmed the energy price cap will stay in place through to early 2027, keeping mains gas at 6.04p/kWh and electricity at 24.5p/kWh for the vast majority of UK households on standard variable rate (SVR) tariffs.
While this provides welcome stability heading into the second half of 2026, the continued cap masks a more complex picture underneath. Homeowners still have meaningful choices to make—and real savings to find.
What the Extended Cap Means
Ofgem's decision to maintain the price cap reflects:
* Stable wholesale markets compared to the crisis peaks of 2021–2023
* Government commitment to energy affordability during cost-of-living pressures
* Continued uncertainty around long-term energy supply and geopolitical factors
However, the cap applies only to customers on default SVR tariffs. If you've never switched, or your fixed deal has ended, you're likely paying the capped rate—but that's not necessarily your best option.
Your Real Choices Right Now
Despite the frozen cap, fixed-rate deals exist below current capped levels. Many suppliers are now offering 12–24 month contracts at rates competitive with or better than the standard cap, especially for customers willing to switch.
Oil and wood heating users have even more leverage. Heating oil currently sits at 96.8p/litre (ex. VAT), and wood pellets at 7.2p/kWh—making alternative fuels increasingly attractive for off-mains customers. If you're switching heating systems or renewing oil stocks, now is the moment to compare fuel costs against the energy grid.
Three Actions to Take Today
1. Check your current tariff against available fixed rates. Even if the cap sets your baseline, a fixed deal may lock in savings. Use our gas and electricity comparison tools to see what's on the market.
2. If you use heating oil, review your supplier and stock levels. At 96.8p/litre, comparing oil prices across providers could save you hundreds annually, especially ahead of winter demand.
3. Evaluate alternative fuels if you're considering a heating system upgrade. Wood pellets at 7.2p/kWh represent a competitive long-term option, particularly if you have suitable storage and an efficient boiler.
What's Next?
Ofgem will review the cap again in early 2027. Expect continued focus on whether the cap remains sustainable and how it balances consumer protection with supplier viability. For now, don't assume the cap is your best deal—active switching remains the fastest route to lower bills.
The takeaway: A frozen price cap means stability, but not complacency. Compare now, lock in savings, and revisit your fuel choice before winter 2026.