Check an energy fix against the Ofgem price cap

Before you take a fixed energy deal, write down your own annual kWh, your current unit rates and standing charges, and the offer's prices and exit fees. Then cost a year at your region's Ofgem cap rates and a year at the offer's rates, using the same usage. On those sums, fix only if the offer comes out cheaper, and know what the exit fees would cost you if you leave early.

Steps follow Ofgem's energy price cap pages and HMRC's brief on the temporary zero rate of VAT on domestic electricity, checked 12 October 2026. The Fenwick example is made up.

What does the cap cover from 1 October 2026?

On Ofgem's figures, the cap for 1 October to 31 December 2026 is £1,723 a year for a typical household paying by Direct Debit in England, Scotland and Wales, up 4% on the 1 July to 30 September 2026 cap. Ofgem gives the average Direct Debit rates as 26.32p per kWh plus a 54.83p daily standing charge for electricity, and 7.97p per kWh plus 29.68p a day for gas. Those are averages across Great Britain, rounded to two decimal places. Your own region and payment method will give a different row.

Ofgem says those figures include 5% VAT on gas and no VAT on electricity. The Value Added Tax (Supplies of Domestic Electricity) Order 2026 (SI 2026/987) zero-rates domestic electricity in England, Scotland and Wales for supplies made from 1 October 2026 to 31 March 2027. HMRC says other fuels aren't affected, so gas stays at 5%, and the same Order keeps 5% VAT on domestic electricity in Northern Ireland.

Ofgem says the cap limits the unit rate and standing charge you pay, and doesn't limit your total bill. It protects standard variable tariffs, which suppliers also call default tariffs. A fixed tariff sits outside the cap, so once you fix, a lower cap later won't lower your price. Ofgem's regional tables cover England, Scotland and Wales only, so if you live in Northern Ireland this comparison doesn't apply as written.

Where does each figure on the sheet come from?

Your usage comes from your latest annual statement or your supplier's app, which should show kWh used over the last 12 months for each fuel. Your current rates, standing charges and payment method are on your latest bill or your tariff information label. If you're already on a fix, the same label gives its end date and exit fee.

For the cap side, open Ofgem's unit rates and standing charges page, enter your postcode to find your region, then copy your region's row from the table for the way you pay. Ofgem publishes separate tables for Direct Debit, standard credit and prepayment meters. If you have Economy 7 or another multi-rate meter, log each unit rate and the kWh used at each, because one blended rate will give the wrong answer.

The offer's figures come from the supplier's quote or its tariff information label. Note whether the prices include VAT, since Ofgem's do.

Example: a fix that saves nothing

The Fenwick household pays by Direct Debit on a default tariff and uses 2,900 kWh of electricity and 9,800 kWh of gas a year. To keep the sums readable they use Ofgem's Great Britain average Direct Debit rates as their cap row. The offer is a 12-month fix at 25.10p per kWh plus 52.00p a day for electricity and 8.40p per kWh plus 31.00p a day for gas, VAT included, with a £75 exit fee for each fuel.

Cap electricity: 2,900 × 26.32p = £763.28, plus 365 × 54.83p = £200.13, total £963.41

Cap gas: 9,800 × 7.97p = £781.06, plus 365 × 29.68p = £108.33, total £889.39

Offer electricity: 2,900 × 25.10p = £727.90, plus 365 × 52.00p = £189.80, total £917.70

Offer gas: 9,800 × 8.40p = £823.20, plus 365 × 31.00p = £113.15, total £936.35

Year at the cap: £1,852.80. Year on the offer: £1,854.05

Dearer gas cancels out the cheaper electricity, so on these figures the fix costs £1.25 more over a year than the cap, and leaving early would add £150 in exit fees. Nothing on the sheet supports fixing, so I'd stay on the default tariff and rerun the sheet when Ofgem publishes the next cap.

What could change the answer?

The cap side of the sheet assumes the 1 October to 31 December 2026 rates last a full year. Ofgem resets the cap every three months, so that year is a snapshot, while a fix holds its rates for its term. A fix that's slightly dearer now can still come out ahead if the cap rises, and the sheet can't tell you whether it will.

The zero rate of VAT on electricity ends on 31 March 2027. If the offer runs past that date, ask the supplier whether its electricity price changes when VAT goes back to 5%, and make sure the offer and the Ofgem row are on the same VAT basis before you compare them.

If you're already on a fix, add its exit fee to the offer side too. If the offer still wins at step 4 with that fee included, ask the supplier to confirm the rates and exit fees in writing before you accept.

Sources

• Energy price cap unit rates and standing charges, Ofgem, checked 12 October 2026.
• Energy price cap and standing charges explained, Ofgem, checked 12 October 2026.
• The Value Added Tax (Supplies of Domestic Electricity) Order 2026 (SI 2026/987), legislation.gov.uk, checked 12 October 2026.
• Revenue and Customs Brief 10 (2026): temporary zero rate of VAT for domestic electricity in Great Britain, HMRC, published 8 September 2026, checked 12 October 2026.