The January 2027 energy price cap will be set by Ofgem on or before 25 November 2026, and three major suppliers now forecast it at £2,183–£2,189 a year for a typical dual-fuel home – about £460 (27%) above today's £1,723. The lower forecast from Cornwall Insight is £1,999 (+16%). For a typical household on Direct Debit that is roughly £23 to £39 more per month from 1 January, and more than that in the cold months when you actually use the energy. Below: your own bill under both forecasts, the dates that matter, and what to set up before the letter arrives.
What the forecasts say (as of 2 November 2026)
The price cap limits the unit rates and standing charges a supplier can charge on a standard variable tariff in England, Scotland and Wales. Ofgem has not set the January–March 2027 level yet. These are forecasts, and the suppliers themselves label their confidence as low.3 Since our first look at the January 2027 cap on 22 October, the supplier forecasts have risen further.
Forecast annual bill for a typical dual-fuel home, January–March 2027
Source: supplier and Cornwall Insight forecasts compiled by PreparedBritain, read 2 Nov 2026.3,4
Why so high? Wholesale gas made up 47% of the October–December cap, and UK and European wholesale gas prices rose sharply from July after shipping disruption in the Middle East. Ofgem's formula looks back at costs observed before each quarter, so much of that rise is already “locked in” for January.3 Cornwall Insight's lower £1,999 figure uses market prices from 28 September and has not been updated since, which is why it sits below the suppliers' newer numbers.
Your bill, calculated: three home sizes
“Typical” is an average. The cap limits rates, not your total, so the useful question is: what does a 16% or 27% rise do to your bill? Take your current annual estimate (it is on your latest statement or app) and scale it. Here are three illustrative examples:
| Home (illustrative) | Annual bill now | If +16% (Cornwall) | If +27% (suppliers) | Extra per month |
|---|---|---|---|---|
| Small flat, low use | £1,100 | £1,276 | £1,398 | £15–£25 |
| Typical 3-bed semi | £1,723 | £1,999 | £2,189 | £23–£39 |
| Larger family home, high use | £2,600 | £3,016 | £3,303 | £35–£59 |
Figures rounded. Per-month amounts spread the annual rise evenly over 12 months.
Now the part most headlines skip. The cap is quoted as an annual figure, but it only applies from January to March – your three heaviest months. If the typical home's rise is £466 a year, the January–March quarter alone carries about £117 of it on a straight quarter split, and in practice more, because you burn far more gas in February than in July. A Direct Debit set for a gentle autumn can fall behind fast.
The cap is an annual number. Your winter bill is not. Plan for the quarter you are actually in.
Before 1 January
A £23–£59 a month jump lands on top of Christmas. The fix is not willpower – it is a bills system that sees it coming.
The Matriarch's Money Reset – Step III: Own the System helps you:
- build a 12-month bills calendar so winter energy, council tax and Christmas never collide by surprise;
- set a small “bill buffer” pot that absorbs a higher Direct Debit or a catch-up letter;
- decide calmly, in writing, who in the household pays what when costs rise.
100% digital PDF – nothing is shipped and there are no shipping fees. Download right after purchase, then print it or fill it in on your phone, tablet or computer. One-time purchase.
The timeline: 6 dates between now and spring
Today–24 Nov: Take a meter reading (photo with date) and check your current annual estimate and Direct Debit amount.
By 25 Nov 2026: Ofgem announces the 1 January–31 March 2027 cap, including new unit rates and standing charges.1
Late Nov–Dec: Your supplier writes with your new rates. Compare its new Direct Debit with your own calculation from the table above.
31 Dec: Take another dated meter reading so December usage is billed at the old, lower rates.
1 Jan 2027: New cap starts. Budget measures announced on 28 October include a £100 household energy payment from January for council tax bands A–D in England.4
31 Mar 2027: The Ofgem rates published for October–December remove VAT from household electricity until this date; the Budget said it will extend 0% VAT on electricity to July 2027.1,4
5 things to do this month
- Find your real number. Multiply your annual estimate by 1.16 and by 1.27. That gives you your best and worst case.
- Divide the difference by 12. Start moving that amount into a separate pot now, while the old rates still apply.
- Check your credit balance. If you are well in credit, a higher Direct Debit may not be needed straight away. If you are in debit, contact your supplier before January.
- Ask about fixed deals – carefully. A fix only helps if it is below what the new cap will be. Wait for Ofgem's figure on 25 November before comparing, and check exit fees.
- Check help you may be owed. Our guides to the Winter Fuel Payment and Cold Weather Payment dates show who qualifies. For the Budget side of energy help, see Energy Bills Budget 2026: £290 Off or a 26% Rise?, and for the future of standing charges, Gas Standing Charge Scrapped 2027.
If you are already behind, talk to your supplier early – they must consider your ability to pay. Free, independent help is available from Citizens Advice and MoneyHelper. If money worry is keeping you up at night, talking to someone you trust helps more than another hour of forecasts.
FAQ
Will the energy price cap go up in January 2027?
Ofgem has not decided yet; it will announce by 25 November 2026. Every published forecast so far points up, from £1,999 (Cornwall Insight) to £2,189 (EDF) for a typical home.
Does the price cap limit my total bill?
No. It caps the unit rates and daily standing charges. Use more energy and you pay more; use less and you pay less.
How much will my monthly Direct Debit go up?
For the typical £1,723 home, the forecasts imply about £23 to £39 a month spread over a year. Your supplier may ask for more in winter, because Direct Debits are set from your expected annual use.
Sources
- Ofgem – Changes to energy price cap between 1 October and 31 December 2026 (rates, VAT note, next announcement 25 Nov 2026)
- Ofgem – Energy price cap unit rates and standing charges
- PreparedBritain – January 2027 price cap forecasts, checked (read 2 Nov 2026)
- The Beaver – Energy price cap forecast to rise by about £460 in January (incl. 28 Oct 2026 Budget measures)
- PayPlan – Ofgem energy price cap rises to £1,723 from October 2026
Feeling the knot in your stomach every time a bill letter lands? Start with the free 7-Day Money Anxiety Reset journal.
Educational content only. Not personalised financial advice.