When to switch energy tariff (and how the price cap works)

Overnight on Wednesday, the National Energy System Operator issued an electricity margin notice, asking generators to make extra supply available for Thursday evening. Its forecasts showed tight margins during the peak, it said, because extreme temperatures across Europe were reducing the availability of some generation. There was no risk to anyone’s supply. It’s a routine balancing tool. But it was the second such notice in a few weeks, both during heatwaves, and it lands in the middle of the stretch of the year when most people assume energy is the last thing they need to think about.

That assumption is the reason summer is the right time to deal with it. The short version: if you want to fix your energy rate before winter, the weeks when your usage is low and wholesale prices are steadier are when the better fixed deals tend to appear, and when you have the head-space to look. Here’s what you’re actually deciding.

What the price cap is, and what it isn’t

Most homes in England, Scotland and Wales are on a standard variable tariff, which means the price cap applies to them. The cap is set by Ofgem and changes every three months. The common shorthand, “the cap is £1,700-ish a year”, is misleading, because the cap doesn’t limit your total bill. It limits two things: the unit rate you pay for each kilowatt-hour of energy, and the daily standing charge. Use more than the typical household and you pay more than the headline figure; use less and you pay less. The cap is a ceiling on the rates, not on the total.

At the time of writing, for July to September 2026, the cap for a typical direct-debit customer sets electricity at 26.11p per kWh with a standing charge of 57.19p a day, and gas at 7.33p per kWh with a standing charge of 29.04p a day. Those rates rose about 13% for a typical dual-fuel household from the start of July.

The standing charge is the part people miss

The unit rate is the number everyone watches, because it’s the one that moves when you turn the heating down. The standing charge is the one that doesn’t move at all. Add the two daily charges above together and you get about 86p a day, which is roughly £315 a year before you have used a single unit of gas or electricity. If you’re a low user, a small flat, away a lot, careful with the heating, that fixed £315 is a much bigger share of your bill than it is for a large household, and it’s the part you can do least about. It’s worth knowing it’s there, because a tariff with a lower unit rate but a higher standing charge can cost a light user more, not less.

Fixed versus variable

A variable tariff moves with the cap, up every quarter it rises and down every quarter it falls. A fixed tariff locks your unit rates and standing charge for a set term, usually twelve or twenty-four months, regardless of what the cap does.

Fixing is buying certainty, not guaranteed savings. If the cap falls over your fixed term you’ll pay more than you would have on the variable rate; if it rises you’ll pay less. What you get either way is a number that doesn’t change, which is worth something on its own if a jumpy bill is the thing that keeps catching you out. This week is a fair illustration of why the number moves at all: a heatwave pushes up demand for cooling while it cuts the output of power stations, EDF has warned it may curb several of its nuclear reactors because the rivers cooling them are too warm, and the wholesale price responds. You can’t control any of that. A fixed tariff means you don’t have to.

When to shop, and why now

The reason summer beats winter is partly practical and partly about pricing. Practically, you have the attention to spare in July that you won’t have in December. On pricing, fixed deals tend to be keener when wholesale markets are calmer and demand is low, which is the summer, and locking in then means you carry that rate through the expensive months rather than fixing in a panic when the cold has already arrived and the good deals have gone.

To compare properly, use an Ofgem-accredited comparison site. Ofgem publishes the list of accredited sites, which agree to show the whole market rather than only the deals they earn a commission on. That’s the check worth doing: an accredited site isn’t steering you.

What to have to hand

Switching takes about ten minutes if you have four things ready:

• Your annual usage in kilowatt-hours, for gas and electricity. This is the single most useful number, and it’s on your annual statement or your online account, not usually on a monthly bill. A comparison based on real usage is worth far more than one based on the estimated bands.
• Your current tariff name and what you’re paying, so you can see whether a fix actually beats it.
• Your meter type, standard, Economy 7, or prepayment, because it changes what you’re eligible for.
• Your MPAN and MPRN, the supply numbers for electricity and gas. You don’t always need them, but they save time, and they’re on your bill.

What happens when you switch

Nothing physical changes. No one visits, no supply is interrupted, and the gas and electricity arrive through the same pipes and wires from the same network. The only thing that changes is who bills you and at what rate. You get a 14-day cooling-off period from the day you agree, and the switch itself usually completes within five working days. If something goes wrong, your old and new suppliers are the ones who sort it out between them, not you.

The thing most people get wrong isn’t the switch. It’s the end of the fix. A twelve-month fixed tariff quietly rolls onto the supplier’s variable rate the day it ends, and if you’ve forgotten the date, you can spend months on a worse rate without noticing. The fix was the easy part. Remembering when it lapses is the part that actually needs a system.

That’s the bit we built Oosby for. Add the tariff once, the name, the rate, the date the fix ends, and it holds the date and nudges you a few weeks before, while there’s still time to shop again. The renewal stops being yours to remember.

For now, though, while the heatwave has energy back in the headlines: dig out your annual statement, find your kWh, and see what a fix would cost. It’s a better use of a hot afternoon than it sounds. If the wider picture is the problem rather than this one bill, start with getting the household bills into one place.