As of August 2026, fixing is worth considering, but only at a rate close to the current price cap. Forecasts point to a further rise in October, driven mainly by gas and landing as the heating season starts. A fix within a few per cent of today’s capped rates is reasonable value for the certainty. A fix well above them is not.
Our verdict, August 2026
Fix, but only close to the cap
Within a few per cent of the capped rates is reasonable value for certainty. More than about 10% above needs a strong reason.
If you are on a standard variable tariff, your rates are protected by the price cap and will typically sit at or close to it.
Cornwall Insight’s latest forecast puts the October cap around 2% above the current one. That is not a dramatic rise, but it is a rise, and it arrives at the point in the year when households start using significantly more energy. The same unit rate produces a far larger bill in November than in August because households use much more energy.
On that basis, the case for fixing rests on a reasonable expectation that rates will not fall over the next few months. What it does not justify is paying a large premium. If the best fix available to you sits within a few per cent of the capped rates, you are buying certainty cheaply. If it sits 10% or more above, you are paying a lot for protection against a rise that is currently forecast at 2%.
Switching to a fixed energy tariff could save the average customer over £214 a year, and in some cases, much more. Back in May, we helped one customer save £1,598 by moving them to a 12-month fixed deal. With prices still unpredictable, now’s the time to compare and lock in a rate that works for you.
- Scott Byrom, Chief Executive Officer
| Electricity | Gas | Typical annual bill | |
|---|---|---|---|
| Current cap Jul–Sep 2026 |
26.11p per kWh | 7.33p per kWh | £1,664 |
| October forecast Oct–Dec 2026 |
26.27p per kWh | 7.70p per kWh | £1,700 |
Standing charges are currently 57.19p a day for electricity and 29.04p a day for gas.
Ofgem price cap, 1 July to 30 September 2026. October figures are Cornwall Insight’s forecast as at 22 July 2026 and are not confirmed rates. Ofgem is expected to announce the October cap in late August 2026.
Three things are worth drawing out of that table.
Gas is doing the work. The forecast gas unit rate rises around 5% while electricity barely moves. Most homes with a gas boiler use three to four times as much gas as electricity by volume, so the effect on a typical bill is larger than the headline 2% suggests and it arrives just as the heating goes on.
The electricity figure is flattered by a tax change. VAT on domestic electricity drops from 5% to 0% on 1 October 2026. That 26.27p forecast already has the VAT stripped out. Underneath the tax cut, electricity costs are rising more than the number implies.
The VAT cut is temporary. It may only run to 31 March 2027. Unless it is extended, electricity rates should be expected to step back up by around 5% in April 2027. VAT changes flow through to fixed tariffs as well as variable ones, so a fix will not protect you from that, worth knowing if you are considering a deal that runs beyond next spring.
The right answer depends on where you currently sit.
| Your situation | What to do now |
|---|---|
| On a standard variable tariff | You are exposed to every quarterly change, and the next one is forecast upward. Comparing is worth doing now. Look for a fix priced within a few per cent of the capped rates above, and treat anything well beyond that with scepticism. |
| Fixed deal ending in the next couple of months | Compare immediately. You can switch penalty-free in the final 49 days of a fixed term, and if you do nothing you will be moved onto your supplier’s standard variable tariff automatically, which is almost always a price rise. |
| Part-way through a fix | Check your exit fee, typically £25 to £75 per fuel. On current forecasts, there is unlikely to be a case for paying it. If you fixed before the July rise, you are probably already sitting below where the market is heading. Diarise your end date and compare 50 days out. |
A verdict is only worth anything if it can change. Four things would move ours:
We review this page at every Ofgem price cap announcement. The next is expected in late August 2026, when the October cap will be confirmed ahead of taking effect on 1 October.
Four checks, whatever the market is doing:
Our fixed price energy guide sets out the full framework, including a worked example showing what a fix costs you against staying variable.
As of August 2026, yes, if you can find a rate close to the current cap. Forecasts point to the October cap rising around 2%, driven by gas. A fix within a few per cent of today’s rates buys useful certainty. One priced well above them is poor value against a modest forecast rise.
No forecaster can say with confidence. What is known is that the electricity VAT cut may expire on 31 March 2027, which should push electricity rates up by around 5% from April unless it is extended. Beyond that, prices depend on wholesale gas markets, which have been volatile throughout 2026.
Yes, and start early. You can switch penalty-free during the final 49 days of a fixed term, so comparing seven weeks before your end date costs nothing. If you let it lapse, you are moved onto the standard variable tariff automatically, which is priced at the cap and almost always more expensive.
You keep paying your fixed rate, that is the trade you made. You can leave early, but you will usually pay an exit fee of £25 to £75 per fuel, which may cancel out the saving. Work out the difference over your remaining term before deciding.
As things stand in August 2026, fixing is worth considering, because forecasts point upward into the winter and gas is driving the rise. But the verdict comes with a condition attached: it holds only for deals priced close to the current cap. There is no fixed rate so good that the premium never matters.
Ultimately this is a judgement about how much certainty is worth to you, not a certainty in itself. Forecasts move, and ours will too. What does not change is that the capped rate is the maximum, not a deal — so the useful first step is finding out what else is available.
See what is actually available at your address before you decide.
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Last updated: 3 August 2026. Capped rates reflect the Ofgem price cap for 1 July to 30 September 2026. Forecast figures are Cornwall Insight’s Default Tariff Cap prediction as at 22 July 2026 and are not confirmed rates. Next review: late August 2026, at the October price cap announcement.
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