Quick answer: the numbers that decide UK electricity comparisons
- Ofgem cap
- £1,641
- Typical dual fuel, per year
- Electricity unit rate
- 24.7p/kWh
- GB average at the cap
- Standing charge
- 57.2p/day
- Electricity, GB average
- Typical electricity-only bill
- £875
- 2,700 kWh at the cap
Why most "compare electricity prices" pages get it wrong
Open any large comparison site and you see the same table: a list of suppliers, a monthly direct-debit figure, a "you could save £200" banner, and a button. Three things are wrong with that table, and they matter.
First, the monthly figure is built from a usage assumption the site picked for you. The default is normally the Ofgem medium of 2,700 kWh a year. If your home actually burns 1,800 kWh or 5,000 kWh, the ranking changes. The "winner" tariff at 2,700 kWh can be the loser at 5,000 kWh, because tariffs trade off unit rate against standing charge.
Second, almost no listicle explains the price cap as a floor as well as a ceiling. The cap is a ceiling on the variable Standard Variable Tariff. It is also the price every fixed deal benchmarks itself against. Suppliers price fixed deals as a small step below or above the cap, not as a different product. The headline £200 savings claim almost never reflects real fixed-deal pricing in 2026.
Third, most tables treat all fixed deals as broadly equivalent and rank by price alone. They ignore contract length, exit fees, and the 49-day exit-fee-free window before contract end. A 24-month fix that beats the cap by £30 a year is only a good deal if you accept the lock-in for two years and three more cap reviews.
The Ofgem cap is the anchor of every UK electricity price
The cap is reviewed every three months. It bundles wholesale costs, network charges, policy costs (the green and social levies suppliers collect), supplier operating costs, a 2.4% profit margin and VAT into one regulated maximum. Every fixed deal on the market is priced in relation to that maximum, because suppliers buy energy on the same wholesale markets Ofgem uses to set it.
That is why the cap acts as both a ceiling and an anchor. Fixed deals cluster just below or just above it. When suppliers compete, the gap between the cheapest fix and the cap usually sits at £30 to £70 a year on a typical bill, not the £200 a listicle suggests. The big savings advertised by comparison sites only show up in narrow situations: a customer who has not switched for years, a tariff that sneaks in with a heavily discounted first month, or a customer modelled at consumption far higher than they actually use.
A fixed deal is also a forward bet. When you fix for 12 or 24 months, the supplier is pricing in its view of the next 2 to 3 cap reviews. If wholesale gas drifts down, the cap drifts down, and a long fix becomes worse value. If wholesale gas spikes (as it did in 2022 and again briefly in early 2025), the fix saves you money. The £4,279 to £1,641 trajectory below shows how violently that bet can swing.
| Quarter | Period | Cap (£/year) | Note |
|---|---|---|---|
| Q1 2023 | Jan-Mar 2023 | £4,279 | Energy Price Guarantee capped bills at £2,500 |
| Q3 2023 | Jul-Sep 2023 | £2,074 | |
| Q4 2023 | Oct-Dec 2023 | £1,834 | |
| Q1 2024 | Jan-Mar 2024 | £1,928 | |
| Q2 2024 | Apr-Jun 2024 | £1,690 | |
| Q3 2024 | Jul-Sep 2024 | £1,568 | Low point of the cycle |
| Q4 2024 | Oct-Dec 2024 | £1,717 | |
| Q1 2025 | Jan-Mar 2025 | £1,738 | |
| Q2 2025 | Apr-Jun 2025 | £1,849 | |
| Q3 2025 | Jul-Sep 2025 | £1,720 | |
| Q4 2025 | Oct-Dec 2025 | £1,717 | |
| Q1 2026 | Jan-Mar 2026 | £1,758 | |
| Q2 2026 | Apr-Jun 2026 | £1,641 | Current cap, green levies moved into general taxation |
Pre-crisis baseline (Q4 2020) sat near £1,042 a year. Source: Ofgem.
Two policy shifts dominate the recent fall. The first is the steady decline in wholesale gas after the 2022 spike. The second, and the main driver of the Q2 2026 cut, is the Autumn Budget 2025 decision to move several green and social levies off energy bills and into general taxation. Ofgem estimates that change alone is worth £130 to £150 a year on a typical bill. The economic gas price has not fallen by 6.6%: the visible bill has.
Standing charges remain controversial. They cover network connection, metering and supplier obligations, and at 57.2p a day they add £209 a year before you have used a single kWh. Ofgem reviewed the option of a lower standing charge with a higher unit rate in 2024 and 2025, but kept the current structure. Low users (flats, second homes, evening-only households) feel the standing charge hardest. Regional variation also matters: the standing charge sits about 7p a day higher in North Wales and Merseyside than in London, for the same supplier.
The same tariff, three different rankings
A simple example shows why annual kWh dominates everything else. Take one realistic fixed deal: 23.67p per kWh (1p below the current cap unit rate) and a 57.2p per day standing charge (the same as the cap). Apply that single deal to three real customer profiles and look at what happens to the saving.
| Profile | kWh/year | On the cap (£/yr) | On the fix (£/yr) | £ saving | % saving |
|---|---|---|---|---|---|
| Small flat 1 to 2 occupants | 1,800 | £653 | £635 | £18 | 2.8% |
| Medium 3-bed home Ofgem medium TDCV | 2,700 | £875 | £848 | £27 | 3.1% |
| Large detached Heavy electric use | 5,000 | £1,442 | £1,392 | £50 | 3.5% |
Costs at the Q2 2026 Ofgem electricity cap (24.7p/kWh + 57.2p/day) versus a fixed deal at 23.67p/kWh + 57.2p/day. Electricity only, VAT included.
The same deal saves the flat £18 a year and the detached home £50 a year. In percentage terms the gap narrows, because the standing charge stays fixed regardless of consumption. For the 1,800 kWh flat, more than half the annual cost is standing charges. For the 5,000 kWh detached house, the standing charge is a third of the bill. A tariff with a higher unit rate but a lower standing charge would flip those two rankings.
The practical lesson is direct. Low users (flats, second homes, holiday lets) should weight the standing charge above the unit rate, because they cannot dilute the daily fee across many kWh. Heavy users should weight the unit rate, because every additional kWh compounds the unit-rate gap.
There is also a third group: customers on the supplier default tariff. Around 50% to 55% of UK households sit on a Standard Variable Tariff because they have never switched, or because a previous fixed deal ended and they rolled onto the cap. The cap is fair, but it is the maximum a supplier can charge, not the cheapest. For 2,700 kWh, a 1p-below-cap fix saves £27 a year. For 5,000 kWh, the same fix saves £50. Neither is dramatic, but neither is zero, and over a 12-month contract that is real money for the price of ten minutes of admin.
Fixed-vs-variable break-even calculator
Comparison tables show you what a fix costs today. They never show you what it costs if the cap moves. This tool does. Enter your annual electricity usage, a fixed-deal unit rate and standing charge, and a guess at how much the cap will move over the contract. The result panel updates live.
Your numbers
The verdict
- Annual cost at today's cap
- Annual cost on the fix
- If the cap stays flat, the fix saves you
- With cap move over months
- Break-even cap move
If the cap stays flat, your fix saves you a year. If the cap stays flat, your fix costs you a year more than the cap. With a cap move over months, the fix wins by . With a cap move over months, the fix loses by . Break-even sits at cap movement.
Calculation assumes the cap moves uniformly over your contract length. Real cap movements happen in quarterly steps. Estimate uses Q2 2026 Ofgem price cap, GB average direct debit, VAT included.
Worked example. A medium home (2,700 kWh) on the cap pays £875 a year. The same home on a fix at 23.67p plus 57.2p standing pays £848 a year. The flat saving is £27. Break-even sits near -4% on a 12-month contract: if the cap falls by more than 4% on average over the next year, the fix becomes a loss.
Three mechanisms the comparison sites do not explain
The real gap is £30 to £70, not £200
When the market is calm, fixed deals cluster within a £30 to £70 a year band below the cap on a typical medium-home bill. Headlines claiming £200 to £400 savings depend on either an unusual market dislocation or a customer modelled at much higher consumption than they actually use. Run your real kWh through the unit rate to see the genuine gap.
The 49-day exit-fee-free window
By law, suppliers cannot charge exit fees in the final 49 days of a fixed contract. Combined with the 14-day cooling-off period, that gives a roughly 9-week window to switch into a new fix without penalty. Most customers miss it, then roll onto the variable cap by default. Set a calendar reminder 60 days before your end date.
Time-of-Use is the only structural discount
EV-driver tariffs and Economy 7 are the only segment of the market still pricing below 10p per kWh, because they shift wholesale risk onto the customer through off-peak windows. If you can move 30% or more of your load to a night window (storage heating, hot water, EV charging, dishwasher on a delay timer), they beat any standard fixed deal.
What you should actually do
Five concrete steps cover almost every UK domestic electricity situation. Run them in order. Most households finish steps one to three in under fifteen minutes.
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1
Pull your real annual kWh from the smart meter
Open the in-home display and find the 12-month total. If you do not have one, subtract the meter reading from a bill 12 months ago from today's reading. Use that number for every comparison.
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2
Compare on p/kWh and p/day, never on £/month
For each tariff you consider, write down the unit rate in pence per kWh and the standing charge in pence per day. The £/month figure is downstream of those two numbers and a usage guess that may not match yours.
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3
Only fix into a tariff priced at or below the cap
If you are on the Standard Variable Tariff, switch into a fix only when its annual cost (your kWh times the fixed unit rate plus 365 times the fixed standing charge) is lower than the cap annual cost for the same kWh. Ignore "save £200" banners that do not let you input real usage.
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4
Heavy evening or EV user? Look at Time-of-Use
If you can shift more than 30% of your kWh to a night window, an Economy 7 or EV-specific tariff usually wins. Run your annual kWh through the day and night split, not just the total, before switching.
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5
Use the 49-day exit-fee-free window
Diary the date 60 days before your current fix ends. From day 49 to day 0, you can switch to another fix without paying an exit fee. Miss it and you default onto the cap, where you usually pay £30 to £70 a year more than you need to.
For a side-by-side of current cheap suppliers, see our cheapest electricity supplier guide. For dual-fuel customers, the same logic applies to gas: see the cheapest gas supplier guide. To estimate your own kWh from scratch, use the energy bill calculator. To browse providers, see the UK energy providers directory.
Three numbers, and everything else is decoration
Compare UK electricity prices on your real annual kWh, the unit rate in pence per kWh, and the standing charge in pence per day. That is the whole skill. Brand, marketing copy, "deal of the month" badges and the monthly direct-debit headline on a comparison site are decoration on top of those three numbers.
In 2026 the realistic saving for moving from the cap to the best fixed deal sits between £30 and £70 a year on a typical bill, sometimes more for heavy users on a Time-of-Use tariff. That is worth ten minutes of work. It is not worth a long lock-in if you do not actually understand what you are signing.
For background on the cap mechanism, see our price cap policy news. For the wider switching process, the dual-fuel guide walks through gas and electricity together.