Energy regulator Ofgem has announced a 13% increase of the energy price cap for the period covering 1 July to 30 September 2026.

The price cap refers to the default tariff applied when a customer has not signed for a fixed-rate tariff. It sets a maximum rate per unit and standing charge that can be billed to customers for their energy use.

Ofgem says the increase is a result of higher wholesale gas prices, caused by the ongoing conflict in the Middle East. However, prices remain well below the height of the energy crisis in 2022 when the government stepped in to cap bills at £2,500.

Currently, 40% (22 million) of accounts are fixed tariffs and are therefore unaffected by this price rise.

From July, electricity prices are set to increase by less than gas prices.

Customers will see a smaller price increase of around 5% on their electricity bills compared to gas bills which are rising by 24%. This reflects the increase in the amount of renewable generation on the system and therefore reduced reliance on gas to generate our electricity, Ofgem says.

The current price cap for a typical household paying by direct debit for gas and electricity is £1,641. Based on the energy use of a typical domestic household, from July the price cap will rise by £18 a month for the average household using both electricity and gas if this level was sustained for a year.

Tim Jarvis, Ofgem CEO, said: “Today’s price change reflects continued volatility in global energy markets. This means higher wholesale gas prices, driven by ongoing conflict in the Middle East, is impacting the price we pay for energy.

“We understand many will be concerned about rising prices. While energy use typically falls over the summer months, there are still practical steps households can take to manage costs, including exploring fixed tariffs or changing their payment method. Smart meter customers can also take advantage of half price or cheap electricity at the weekends.

“While our energy supplies remain secure, the best way to limit this exposure is by investing in our energy network. That’s why we’re unlocking the funding needed for the biggest transformation of our lifetime to deliver a system that is secure, resilient, and works for consumers across Great Britain.”

Adam Scorer, National Energy Action Chief Executive, said: “The impact of the US-Israel conflict with Iran has already hit households reliant on heating oil and will be felt on gas and electricity bills from July.

“As always, the most vulnerable will bear the brunt. Low-income households are stuck on this rollercoaster of global energy prices. For them this is not a one-off price increase. It is an unrelenting pressure that builds and builds and builds, resulting in unprecedented numbers owing around £5.5 billion in energy debt and rationing their energy usage.

“With another tough winter coming, and bills expected to stay high, now is the time for the government to set out targeted interventions to help those on the lowest incomes afford their energy and to clear their debt. The government can also do more to streamline referral routes for fuel poverty support for both households with young children and those with serious health conditions.”