Energy: the cap is up 4% from October confirmed

Two things landed together on 1 October. The energy price cap rose 4% to £1,723 a year for a typical direct-debit household, and VAT on domestic electricity dropped from 5% to zero. The second one pays for part of the first: the VAT cut is worth about £45 a year and it is already inside that 4%. Ofgem says so itself — this cap period cannot be compared directly with the last one — which means the underlying rise in what energy costs is bigger than the headline. It is gas doing the work: gas unit rates are up 8.7% while electricity is up 0.8% and its daily standing charge has actually fallen, from 57.19p to 54.83p. The VAT cut covers Great Britain only; Northern Ireland stays at 5% and its Executive receives comparable funding instead. The date that matters now is 31 March 2027, when the zero rate ends and 5% goes back on electricity, five days before the new tax year starts. Whether it is extended is a Budget question.

Your energy bills go up on 1 October. Ofgem's cap rises 4%, from £1,663 to £1,723 a year for a typical direct-debit household — roughly £5 a month. Almost all of it is gas, up 8%, while electricity is broadly flat because VAT on it has been removed; without that the cap would be about £45 higher. The cap caps unit rates, not your bill, so a cold winter still costs more. If you are on a fixed deal you are untouched until it ends.

Ofgem has confirmed the energy price cap rises 4% on 1 October: a typical dual-fuel home paying by direct debit goes from £1,663 to £1,723 a year, about £5 a month. Nearly all of it is gas, which is up 8% — an all-electric home sees under 1%. Two things worth knowing: the cap limits unit rates, not your bill, so if you use more than the typical home you pay more than £1,723; and around a third of households are on a fixed deal and won't see this at all.