Energy price cap January 2027: the date and your options

Ofgem will announce the energy price cap for 1 January to 31 March 2027 on 25 November 2026. Until that day the level is not known, and every figure in circulation is a forecast.

That leaves households on a standard variable tariff with a plain question for the next seven weeks: take a fixed deal now, or wait for the announcement. The dates and rules below are the facts to decide on.

What is fixed in the calendar

The cap is set every three months. The 25 November date comes from Ofgem’s own schedule, published with the October cap.

The level today

From 1 October to 31 December 2026 the cap is £1,723 a year for a typical household that uses both fuels and pays by Direct Debit. That is £60 a year more than the July to September level of £1,663, a rise of 4%. On average across England, Scotland and Wales, Direct Debit customers pay 26.32p per kWh for electricity with a standing charge of 54.83p a day, and 7.97p per kWh for gas with a standing charge of 29.68p a day.

Ofgem gave higher wholesale gas prices as the reason, linked to the conflict in the Middle East. In its press release of 26 August it said wholesale prices had risen 11% over the previous three months, that gas bills would go up by 8% and that electricity bills would stay broadly stable.

Three announcements in 2026 so far

The record of this year shows why a forecast made in October deserves some caution.

• 25 February: the April to June cap fell by 7%, or £117, to £1,641. Ofgem pointed to changes in how government schemes are funded and to lower wholesale prices.
• 27 May: the July to September cap rose by 13%, driven by wholesale gas.
• 26 August: the October to December cap rose by 4%.

One fall and two rises in nine months. Analysts and suppliers publish forecasts for January, and we summarise them in our guide to UK energy prices in 2027. They are estimates and they change from week to week. The only figure that will appear on your bill is the one Ofgem publishes.

Who the January cap applies to

The cap protects people on tariffs where the rate can go up or down, which in practice means the standard variable tariff, also called the default tariff. You are on it if you have never chosen a deal, if your fixed deal has ended and you did nothing, or if you moved into a home and have not picked a tariff yet.

It does not apply to fixed tariffs. Ofgem said in August that 35% of households, around 11 million, were on a fix and were therefore not affected by the October rise. The same will be true in January.

The cap is a limit on unit rates and standing charges. Ofgem states that it does not limit the cost of your total bill. The levels also differ by region, by payment method and by meter type, so your own rates will not match the averages exactly.

VAT in the first quarter of 2027

Household electricity in Great Britain carries no VAT from 1 October 2026 to 31 March 2027, according to HMRC’s brief of 8 September 2026. The whole January to March cap period falls inside those dates. Gas is not affected and still carries 5% VAT. In Northern Ireland electricity stays at the 5% rate, and the Ofgem cap does not apply there either.

HMRC’s brief does not say what happens after 31 March 2027. If the zero rate ends on that date, VAT returns to electricity bills in the April cap period, whatever wholesale prices do.

Fixing before 25 November or waiting

A fixed tariff holds your unit rates and standing charges until the contract ends, usually after 12 months according to Citizens Advice. It protects you if the cap rises in January and again later. It costs you if the cap falls below your fixed rates, because you keep paying the higher price or pay an exit fee to leave.

Citizens Advice is careful on this point: a fix might be cheaper over a whole year than the standard variable tariff, but you need to think about how the cost of energy could change, and it could end up costing you more.

Ofgem said on 26 August that fixed tariffs were on sale at £100 or more below the October cap. That was true on that day. Check today’s prices for your own usage on a comparison site, where partner links are marked, and compare the annual cost with what you pay on the capped rates.

Then look at three things in the tariff details.

1. The annual cost against the current cap. A fix priced below today’s capped rates saves money from the first day, and the January announcement can only change how large the saving is.
2. The exit fee. With a low fee or none, you can leave if prices fall. With a high fee for each fuel, you are committed.
3. The length. A 12-month fix that starts in October 2026 ends in October 2027, before the following winter. Check the end date in the tariff details.

The cooling-off period around announcement day

You have 14 days to cancel a new energy contract without a fee. Citizens Advice says the period begins the day after you agree the contract. A deal agreed on 12 November or later is therefore still inside its cooling-off period on 25 November.

Be careful with this. If the switch has already gone through when you cancel, you do not return to your old tariff automatically. The supplier has to explain your options, and Citizens Advice says you then have 15 working days to act. Cancelling is a safety net, and a poor way to speculate.

If you decide to stay on the cap

Staying on the standard variable tariff is a reasonable choice if no fix is cheaper than the capped rates for your usage, or if you expect to move home soon. It has no exit fee, so you can switch in December once the January level is known. Fixed prices may have moved by then as well, in either direction.

Whatever you choose, send a meter reading close to 1 January unless a smart meter does it for you. It makes sure the energy used before that date is billed at the old rates. If you are already on a fix, the date that matters is your end date, and our guide to a fixed energy tariff ending explains the 49 days before it.