The energy price cap and Warm Home Discount — what they actually mean
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Quick answer: Ofgem's default tariff cap (the 'energy price cap') is reset every 3 months and limits what suppliers can charge per unit and per day on standard variable tariffs.
Ofgem's default tariff cap (the 'energy price cap') is reset every 3 months and limits what suppliers can charge per unit and per day on standard variable tariffs. The Warm Home Discount is a separate £150 winter rebate for low-income households.
What the cap actually does
Ofgem caps the unit rate (per kWh of electricity and gas) and the standing charge (the daily fee just for being connected) on a supplier's default tariff. The £-figures you see in the news (e.g. '£1,738 a year') are for a typical-use household — your bill will be higher or lower based on what you use.
Fixed tariffs are not subject to the cap — they can be cheaper or more expensive depending on the wholesale market when you fix.
The cap reset takes effect on the first day of each quarter. Suppliers must give you advance notice of new rates.
Warm Home Discount
A £150 one-off discount paid by your electricity supplier to qualifying low-income households over the winter (October–March).
From winter 2025/26 the scheme was expanded in England and Wales: Core Group 2 now covers households on qualifying means-tested benefits with their name on the electricity bill — the old high-energy-cost property test was removed.
Scotland operates a separate scheme — eligibility is broadly similar but applications may be needed for the 'broader group'.
You usually don't need to apply: payments are made automatically by your supplier in November–March. Check with your supplier if you think you qualify but haven't been credited.
Other winter support
Winter Fuel Payment: changed in 2024 to be means-tested. Now only paid to State Pension Age households also receiving Pension Credit or certain other means-tested benefits. Worth £200–£300.
Cold Weather Payment: £25 per 7-day cold spell for certain benefit claimants. Triggered when temperature is at or below 0°C for 7 consecutive days in your postcode.
Household Support Fund: discretionary local authority help for energy bills, food and essentials. Apply through your council if you are struggling.
Common questions
Should I fix my energy tariff?
From 1 July 2026 cap rates rise about 13%, so standard-variable customers should compare fixes before the reset. A fix can beat the cap if wholesale prices stay high — but check exit fees (often £50 per fuel). Already on a fix? Leaving early usually costs unless you are in the last 49 days or your supplier lets you refix without penalty. Low-use households should compare standing charges, not just unit rates.
How do I get the Warm Home Discount?
In England & Wales, most eligible households are identified automatically through DWP and HMRC data sharing. You receive a letter in autumn confirming eligibility. If you should have received it but didn't, contact your supplier first.
Can I switch supplier and keep the cap?
The cap applies to all suppliers' default tariffs, so switching to another default tariff doesn't change much. Switching to a fixed tariff means leaving the cap entirely — usually for a fixed term.