Jane Hutt, the Cabinet Secretary for Social Justice, Trefnydd and Chief Whip in the Welsh Government, met Ofgem officials on 25 February 2026 to discuss the next domestic energy price cap, according to a written statement on fuel poverty published on 26 February 20261. The statement confirms that the price cap for 1 April to 30 June 2026 will be set at £1,641, a reduction of 7%, or £117, from the current level of £1,7581.
The statement attributes the reduction primarily to changes in policy costs announced by the UK Government's Chancellor in the autumn Budget. These included the closure of the Energy Company Obligation and the Great British Insulation Scheme, and the movement of other policy costs into general taxation, which together reduce average household bills by around £1501. Other factors cited are a decrease in the unit rate, a small reduction in the standing charge, and recent falls in wholesale energy prices1.
On fixed tariffs, the statement says Ofgem reports that 38% of customers are on fixed tariffs, roughly the same figure as before 2022, and that last year customers on a fixed tariff paid around £115 less on average than those on variable tariffs1. On standing charges, Hutt welcomed confirmation from Ofgem that a pilot for lower standing charge tariffs will start this spring1.
"Yesterday, I met Ofgem officials to discuss the next domestic energy price cap which will come into place on 1 April"
The statement puts the estimated number of households in fuel poverty in Wales at 340,000, or 25%1. It also sets out Welsh Government support, including the Discretionary Assistance Fund, which it says continues to provide emergency funding for vulnerable people in financial crisis, and over £120 million this year into retrofitting the homes of low income households through the Warm Homes Nest scheme and the Optimised Retrofit Programme1. Free expert energy advice is available to all householders in Wales via the Nest helpline1.
| Item | Figure |
|---|---|
| Price cap, 1 April to 30 June 2026 | £1,641 |
| Current price cap level | £1,758 |
| Reduction | £117 (7%) |
| Households in fuel poverty in Wales (estimated) | 340,000 (25%) |
| Customers on fixed tariffs | 38% |
| Average saving on fixed versus variable tariffs last year | £115 |
Why it matters for households
The cap sets a limit on the unit rate and standing charge a supplier can charge on a default or standard variable tariff, so a fall from £1,758 to £1,641 changes what a household on that kind of tariff pays for each unit of gas and electricity used, not the total bill, which still depends on consumption. The statement notes that the reduction is driven largely by policy costs moving off bills and into general taxation, rather than by wholesale prices alone, which means the size of the fall reflects decisions about how energy bills are structured as much as the cost of energy itself.
For a household weighing a fixed deal against a variable one, the statement's figures show that fixed tariffs were cheaper on average last year, and that more than a third of customers are now on them. The standing charge pilot matters for homes that use little energy, because a standing charge is paid regardless of how much gas or electricity is used, so a lower standing charge changes the balance for low users in particular. The statement also notes that the cap applies to domestic supply in Great Britain; separate arrangements apply in Northern Ireland, where the Ofgem price cap does not set the default tariff.
What happens next
Hutt says she will raise supplier support, fair and affordable payment plans and emergency support when she meets energy suppliers on 12 March1. The new cap takes effect on 1 April 2026 and runs to 30 June 20261. The pilot for lower standing charge tariffs is due to start this spring1.