Bills Estimator UK — Free Household Bills CalculatorEstimate your gas, electricity & water bills with May 2026 Ofgem rates

Q2 2026 Price Cap Change

Ofgem reduced the energy price cap by 6.7% from 1 April 2026, bringing the typical annual dual-fuel bill from £1,758 down to £1,641. For most UK households, this means savings of approximately £117 per year — or roughly £10 per month — compared to Q1 2026 rates. Our bills estimator is updated with these latest Q2 2026 rates.

What This Means for Different Households

The savings vary by property size and consumption. A 1-bedroom flat might save around £6/month, while a 4-bedroom house could see reductions of £14/month or more. Use the bills estimator above to see your personalised estimate at the new rates. The reference table shows typical monthly totals for each property type under the current £1,641 cap.

Forward Outlook

Ofgem will announce the Q3 2026 price cap (covering July to September) in late May or early June. Analysts are watching wholesale energy markets closely — current forward prices suggest the cap could fall further, though geopolitical factors and seasonal demand create uncertainty. We'll update our bills estimator as soon as the new rates are confirmed.

Practical Tips to Save More

Even with falling price caps, most households can reduce their bills further. Consider improving your home's insulation (loft and cavity wall insulation can save £200-400/year), using a programmable or smart thermostat, switching to LED lighting throughout your home, and running dishwashers and washing machines during off-peak hours. Reviewing your tariff — many fixed deals now beat the price cap — could yield additional savings.

Ofgem Price Cap Explained

The Ofgem energy price cap is the maximum rate that energy suppliers can charge per unit of gas and electricity on their default (standard variable) tariffs. Introduced in January 2019, the cap is reviewed quarterly — in January, April, July, and October — and adjusted based on wholesale energy costs, network charges, policy costs, and supplier operating margins. The current Q2 2026 cap is set at £1,641 per year for a typical dual-fuel household paying by direct debit. This represents a 6.7% reduction from the Q1 2026 cap of £1,758, saving the average household approximately £117 per year.

It's important to note that the price cap is not a cap on your total bill — it caps the unit rate and standing charge. If you use more energy than the "typical" household, your bill will be higher than £1,641. Our bills estimator accounts for this by adjusting for your specific property type and occupancy.

Standing Charges vs Unit Rates

Every energy bill has two components. The standing charge is a fixed daily fee for maintaining your connection to the gas and electricity networks — you pay this regardless of how much energy you use. As of Q2 2026, typical standing charges are approximately 61p/day for electricity and 32p/day for gas.

The unit rate is the cost per kilowatt-hour (kWh) of energy consumed. Current Ofgem cap rates are approximately 24.5p/kWh for electricity and 6.76p/kWh for gas. Gas is significantly cheaper per kWh, which is why gas central heating remains the most cost-effective option for most UK homes despite the push towards electrification.

How Water Bills Work

Unlike energy, water bills in England and Wales are not subject to a national price cap. If you have a water meter, you pay for the volume you use (measured in cubic metres) plus a fixed standing charge. If you're unmetered, your bill is based on the rateable value of your property — a figure set by your local authority, often decades ago.

The average UK household water and sewerage bill is approximately £448 per year according to Water UK, though this varies significantly by region. Southern Water and South West Water customers tend to pay more, while United Utilities and Severn Trent customers often pay less. Our bills estimator uses national average water rates, but your actual costs may differ depending on your water company and region.

Regional Variation

Energy rates under the Ofgem price cap are nationally standardised — you pay the same capped unit rate whether you live in Cornwall or Cumbria. However, water rates vary significantly by region because each water company sets its own charges, approved by the water regulator Ofwat. Scotland has a separate water charging system where bills are linked to council tax bands rather than metered usage or rateable values.

The Formula

Your energy bill is calculated using a straightforward formula:

For example, a household using 3,100 kWh of electricity annually at 24.5p/kWh with a 61p/day standing charge would pay: (3,100 × £0.245) + (365 × £0.61) = £759.50 + £222.65 = £982.15, plus 5% VAT = approximately £1,031 per year for electricity alone. Our bills estimator performs this calculation automatically for all three utilities based on your inputs.