Ofgem price cap January 2027: confirmed rates explained
What the January–March 2027 energy price cap means for your bills, what’s actually “capped”, and how to check whether switching could still be better for your home.
- Clear breakdown of unit rates and standing charges (and why your bill can still vary)
- UK-specific caveats: region, meter type, payment method, and consumption
- Two realistic examples with numbers to help you estimate your costs
Price cap figures are set by Ofgem and vary by region, meter type and payment method. Any bill examples on this page are estimated.
Fast answer: what the Ofgem price cap for January 2027 does (and doesn’t) do
The Ofgem price cap limits the maximum unit rate (pence per kWh) and daily standing charge that suppliers can charge most households on default tariffs (including standard variable tariffs) in Great Britain.
Important: The cap is not a cap on your total bill. Your bill still depends on how much energy you use, your region, your meter type, and how you pay.
Key takeaways (UK-specific)
Applies to:
Most households on default tariffs (often after a fixed deal ends) and some prepayment tariffs.
Varies by:
Region (distribution area), payment method (Direct Debit/credit/prepay), and meter (single-rate or Economy 7).
Switching can still help:
Some fixed tariffs can be below the capped default rates, but check exit fees and the end date.
If you want the cap figures in plain English, jump straight to confirmed rates. If you’re deciding whether to move off a default tariff, go to compare & switch.
Ofgem price cap January 2027 confirmed rates (what to look for)
When people search “confirmed rates”, they usually mean the capped unit rates and standing charges for the January–March 2027 cap period. These are published by Ofgem for different tariff types.
This page explains how to interpret the cap and how to estimate costs. For the latest official tables, use Ofgem’s published cap levels and annexes for the relevant period.
Why you may see different “cap rates” online
- Region: standing charges can differ by distribution region.
- Payment method: Direct Debit caps can differ from prepayment/standard credit.
- Meter type: single-rate electricity differs from Economy 7 (day/night rates).
- Fuel: electricity-only, gas-only, or dual fuel have separate capped components.
How to read the cap (quick guide)
Unit rate (p/kWh)
What you pay per unit of energy used. This is the part that changes most with your consumption.
Standing charge (p/day)
A daily fixed charge to cover network, metering and operating costs. You pay it even if you use no energy.
Estimate your monthly cost from capped rates (simple method)
- Electricity estimate
- (Electricity unit rate × kWh used) + (Electricity standing charge × number of days)
- Gas estimate
- (Gas unit rate × kWh used) + (Gas standing charge × number of days)
Two realistic scenarios (illustrative numbers)
Because the cap varies by region and payment method, the examples below use illustrative rates so you can see the maths. Replace them with your supplier’s rates (from your bill or app) for a more accurate estimate.
Scenario A: typical dual-fuel household (Direct Debit)
Assumptions (illustrative): Electricity 26p/kWh & 55p/day; Gas 7p/kWh & 32p/day; 30-day month. Usage: 270kWh electricity, 900kWh gas.
- Electricity: (270 × £0.26) + (30 × £0.55) = £70.20 + £16.50 = £86.70
- Gas: (900 × £0.07) + (30 × £0.32) = £63.00 + £9.60 = £72.60
- Estimated monthly total: £159.30
Bill totals will differ with VAT rounding, seasonal use, and your exact regional standing charges.
Scenario B: electricity-only flat (single-rate meter)
Assumptions (illustrative): Electricity 26p/kWh & 55p/day; 30-day month. Usage: 190kWh electricity.
- Electricity: (190 × £0.26) + (30 × £0.55) = £49.40 + £16.50 = £65.90
Economy 7 note: If you have a day/night meter, your cost depends on how much use happens overnight. A lower night rate only helps if enough consumption shifts off-peak.
Want to see whether a fixed tariff could beat your current default rates? Use a whole-of-market comparison: get your energy quote.
Compare prices for your home (and keep the cap as a benchmark)
The cap can be a useful reference point, but it’s not automatically the cheapest option. If you’re on a standard variable/default tariff, it’s worth comparing unit rates, standing charges, contract length and exit fees.
When it can make sense to compare now
- Your fixed deal has ended (or ends soon) and you’ve been moved to a default tariff
- You’ve moved home and haven’t chosen a tariff yet
- Your usage has changed (home working, heat pump, EV, extra occupants)
- You want price certainty for budgeting (and accept possible higher costs if prices fall)
Before you switch: check whether you have an exit fee on your current fixed tariff and whether there are any smart meter or meter-type requirements.
Get a quote (whole-of-market)
Tell us a few details and we’ll show available deals for your property. We’ll use your postcode to match regional charges and available tariffs.
Price cap vs fixed tariff: what’s the practical difference?
Many households treat the cap like a “recommended tariff”. It isn’t. It’s a regulatory limit for certain tariffs. A fixed deal can be cheaper or more expensive than the capped default rates depending on wholesale prices and supplier pricing.
| Feature | Capped default tariff (SVT) | Fixed tariff |
|---|---|---|
| Price changes | Can change when the cap changes (typically quarterly) | Usually fixed for the contract term |
| Exit fees | Typically none | Common on fixed deals (check your terms) |
| Budget certainty | Lower certainty (rates can rise/fall each period) | Higher certainty (rates stay the same) |
| Who it often suits | Short-term flexibility; people likely to move; those avoiding exit fees | Households wanting predictable budgeting; those seeing a clearly lower rate |
| Main watch-outs | Standing charges can still be high; bill depends on usage | Exit fees; “fixed” doesn’t always mean cheapest later |
Decision checklist (who it suits / who it doesn’t)
A fixed tariff may suit you if…
- You want predictable unit rates for budgeting
- The fixed unit rates and standing charges are clearly lower than your current tariff
- You’re happy with the contract length and any exit fees
- You’re not expecting to move home soon
Staying on a capped default tariff may suit you if…
- You need flexibility (e.g., likely to move or change payer)
- You don’t want to risk exit fees
- You’re comparing deals but haven’t found a better total cost yet
- You’re waiting for a smart meter / meter change that affects eligibility
Tip: When comparing, focus on the total estimated annual cost for your actual consumption, not just the headline unit rate.
Costs, exclusions and common pitfalls (January 2027 cap period)
These are the most common reasons households feel “the cap didn’t help” or why a switch doesn’t work out as expected.
1) Standing charges still add up
Even with low usage, daily charges can be a significant part of the bill. Compare both unit rates and standing charges.
2) The cap isn’t universal
It generally covers default tariffs, not every possible tariff. Some specialist tariffs (including some bundled offers) may be priced differently.
3) Economy 7 can be misjudged
If most electricity use happens in the day, Economy 7 may cost more. Check your day/night split before switching.
4) Exit fees and timing
Leaving a fixed deal early may trigger fees. Also check when your current deal ends—many suppliers allow switching without penalty in the final window.
5) Paying by prepayment
Prepayment caps and tariffs can differ. If you’re struggling, check help options such as the Priority Services Register.
6) Debt and switching rules
If you owe money, switching may be limited in some situations (especially for prepayment). There are protections and routes to get support.
If you’re worried about paying your bills: Citizens Advice explains grants, payment plans and emergency credit options. See Citizens Advice energy guidance.
FAQs: Ofgem price cap January 2027
Is the price cap a cap on my total bill?
No. It caps the unit rate and standing charge on most default tariffs. Your total bill depends on how much gas and electricity you use.
Does the cap apply across the whole UK?
The Ofgem cap applies in Great Britain (England, Scotland and Wales). Northern Ireland has a different market and regulator arrangements.
Why are the “confirmed rates” different for my friend in another area?
Standing charges (and sometimes unit rates) vary by region because network costs differ. Payment method and meter type also change the cap level.
I’m on a fixed tariff—does the cap protect me?
Usually, no. Fixed tariffs aren’t typically governed by the default tariff cap in the same way. Your fixed rates follow your contract until it ends (unless you change tariff).
Can my supplier put prices up during the January–March 2027 cap period?
On a default tariff, the supplier can’t exceed the capped rates for your tariff type, region and payment method. Prices can still change at the next cap update period.
Does a smart meter change what I pay under the cap?
A smart meter doesn’t automatically reduce rates. But it can affect how accurately you’re billed (fewer estimates) and may open up eligibility for certain tariffs depending on the supplier.
I rent—can I switch energy supplier?
Often, yes—if you pay the energy bills and your tenancy agreement doesn’t include energy as part of rent. If you have a prepayment meter, there may be extra steps.
Where can I check the official January 2027 cap tables?
Use Ofgem’s official publications on the energy price cap, including the annexes with regional values: Ofgem energy price cap.
Trust, methodology and sources
Article details
- Written by: EnergyPlus Editorial Team
- Reviewed by: Energy Specialist
- Last updated: July 2026
If Ofgem updates the published January–March 2027 tables or guidance, we’ll update this page to reflect the official figures and any rule changes.
How we assess “confirmed rates”
We treat “confirmed rates” as the official Ofgem-published maximum unit rates and standing charges for a given cap period. Where this guide uses numeric examples, they are illustrative to demonstrate the calculation.
- Assumptions: 30-day month, VAT included in illustrative maths, single-rate electricity unless stated
- Limitations: your regional charges, payment method and meter type can materially change the cap values
- What you should verify: your current tariff’s unit rates, standing charges and any exit fees before switching
Primary sources (UK)
- Ofgem: energy price cap (official cap levels and annexes)
- Citizens Advice: energy supply and bills (rights, complaints, affordability support)
- GOV.UK: find an energy certificate (EPC) (useful for improving efficiency and reducing usage)
Editorial standards (what we aim to do)
- Answer the query early, then provide practical steps and caveats for UK households.
- Use official regulators and consumer bodies for definitions and rules.
- Separate official cap mechanics from illustrative examples and label estimates clearly.
- Focus comparisons on total cost drivers (standing charges + unit rates + usage + fees).
Ready to check what you could pay under the January 2027 cap?
Use the cap as a benchmark, then compare available fixed and variable deals for your postcode. No promises—just clear options and UK-specific detail.
Switching eligibility and prices vary by supplier, credit checks (where applicable), meter type and payment method.
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