Millions of UK households are facing higher energy costs from January 2026, with confirmation that the energy price cap is increasing.
What's Changing with Your Energy Bills?
The regulator has announced that the energy price cap will rise by £3 per year for an average household, moving from the current level to £1,758 starting January 2026. This marks another increase in energy costs for consumers across the country.
With bills continuing to rise rather than fall, financial experts are suggesting that now might be the time for consumers to consider switching away from variable tariffs to secure a fixed-rate deal.
Martin Lewis' Money Saving Expert Advice
Martin Lewis' Money Saving Expert (MSE) has issued clear guidance for energy customers. The consumer website states that customers who can find fixed tariffs priced below the October price cap level are "very likely" to save money over the coming year.
This would involve ditching standard variable tariffs from major suppliers, including:
- British Gas - Standard Variable
- EDF - Standard (Variable)
- Eon Next - Next Flex
- Octopus - Flexible Octopus
- Ovo - Simpler Energy
- Scottish Power - Standard
When Does Switching Make Financial Sense?
MSE provides specific calculations to help consumers make informed decisions. "It's predicted that over the next year you'll pay roughly 2% MORE than the October price cap on a price-capped tariff," the website explains.
Based on these predictions, MSE offers this straightforward advice:
If you find a fixed tariff that's cheaper than the October Price Cap, you're very likely to save money. For deals costing up to 2% more than the cap, you'll probably still save because the price cap is expected to rise further. However, fixes costing more than 2% above the cap are unlikely to provide savings.
MSE highlighted several fixed deals worth considering, including Eon's Next Fixed 12m, EDF's Simply Fixed, and Outfox Energy's Fix'd Dual.
The consumer champion also noted that historical data supports switching to fixed deals, stating that "at every point over the last year, on average, you'd have been better off getting the cheapest 12 month fix than going on the price cap."
