Why UK electricity prices stay high even when gas falls (2026), a plain-English guide, and what it means for Durham households

If you’ve seen headlines about gas getting cheaper but your electricity bill still looks stubborn, you’re not imagining it. In February 2026, wholesale gas prices have eased at points, yet UK electricity prices have not dropped in the same clean, satisfying way.

The reason is simple in concept but messy in practice. Electricity prices don’t behave like the petrol sign outside a garage, where a lower wholesale cost shows up quickly. Instead, they’re shaped by how the power market sets prices, plus a stack of charges that barely move when gas does.

This guide explains it in plain English, with Durham households in mind.

Why electricity can stay expensive even when gas is cheaper

Think of the electricity market like a busy takeaway on a Friday night. The kitchen uses a mix of ingredients, some cheap, some pricey. Yet the final price of your meal can still be set by the most expensive ingredient that’s needed to complete the orders.

That’s close to what happens with the marginal pricing model in Great Britain’s wholesale electricity market. Many hours, the last power station needed to meet demand is a gas plant. Even if lots of electricity comes from renewable energy generation, the gas generator often becomes the “price setter” for that period. So the market price can still lean on gas.

If gas is still “on the margin”, a fall in gas can help, but it won’t always flow through fast, or fully.

This matters in 2026 because gas remains a key balancing fuel when demand peaks, wind drops, or interconnector imports are tight. LNG imports and geopolitical instability contribute to why the market remains sensitive even during mild spells, so a mild spell can push gas down for a while, but electricity can stay firm if the system expects stress later (cold snaps, outages, or supply worries).

Real-world numbers show the same story. In February 2026, wholesale gas prices have averaged about 76.58p per therm, while wholesale electricity has been around £72.75 per MWh, after a drop earlier in the month (per Cornwall Insight data). Even so, day-ahead power has traded higher at times, around £100/MWh in late January, which hints at the wholesale market volatility in short-term pricing.

If you want a deeper look at the “gas still drives bills” evidence, this summary of UKERC findings via Carbon Brief is useful: expensive gas as a major driver. For a clear explanation of why renewables do not automatically mean cheap power every hour, this plain explainer also helps: why prices follow the most expensive source.

The parts of your bill that don’t fall when wholesale gas falls

Even if wholesale electricity drops, your bill includes costs that move slowly, or not at all. That’s why households can hear “gas is down” yet still see high direct debit payments.

As of the Ofgem energy price cap for 1 Jan to 31 Mar 2026, a typical dual-fuel household paying by Direct Debit faces an annualised bill of about £1,758 (England average, with Durham typically similar in the North). The electricity unit rate under that Ofgem energy price cap is around 27.69p/kWh for electricity and 5.93p/kWh for gas, with standing charges of roughly 54.75p a day (electricity) and 35.09p a day (gas).

Here’s the key point: wholesale energy costs are only one slice.

Policy and network costs

Bill component	What it covers (plain English)	Why it may stay high
Wholesale energy costs	The cost of buying electricity and gas	Suppliers buy ahead, and short-term spikes affect the average
Infrastructure costs	Maintaining the wires, substations, and gas pipes	Set by regulated periods, not daily market moves; ageing electricity grid requires ongoing investment
Standing charges	Fixed daily costs, whatever you use	Recover fixed system and supplier costs, even with lower usage
Policy costs and levies	Schemes and obligations set by government and regulators, such as Energy Company Obligation, Warm Home Discount, and Renewables Obligation Certificates	Often updated on a schedule, not linked to today’s gas price
Supplier operating costs	Billing, customer service, bad debt, metering	Doesn’t drop just because wholesale dips
Grid balancing costs	Keeping the grid stable when supply and demand shift	Can rise when wind is low or the grid is constrained; includes Capacity Market payments

The takeaway is that a wholesale fall can be real, but still feel small at home. In early 2026, wholesale easing helped a little, yet policy and network costs shifted up slightly, so the overall cap barely moved in the way people expect.

For extra detail on how wholesale pricing and policy costs have shaped bills in recent years, UKERC’s work is worth reading: The Price of Power report.

Also remember timing. Ofgem’s cap is based on a past window of wholesale prices, not the price you saw this morning. So even a genuine fall can take months to show up.

What it means for Durham households in 2026, and what change could look like

High electricity prices hit Durham in a very practical way. They squeeze everything else. Food shops feel pricier, bus fares sting more, and saving becomes harder. For families already watching every pound, it can feel like the rules are set somewhere far away, with no one accountable.

So what can you do right now, while the system stays complicated?

• Check fixed-rate energy contracts as well as the standard variable tariff: the standard variable tariff is a ceiling, not the cheapest option. If a fixed-rate energy contract is lower and suits your risk comfort, it can help.
• Cut waste first, not comfort: draft-proofing, radiator panels, and sensible thermostat habits often beat big purchases.
• Watch standing charges: if you use very little electricity, standing charges can dominate. That changes how you judge “savings”.
• Consider longer-term investments: for those ready to invest more, solar panels and battery storage, or heat pumps and electric vehicles, can help reduce long-term grid dependency.
• Get help early: if you’re struggling, talk to your supplier before arrears build.

Still, households can only do so much. If the market design lets gas set the price too often, and if bill add-ons keep rising, then “just shop around” becomes a weak answer.

This is where politics matters. Reform UK Durham argues for a simpler deal for working households: cut waste, stop rip-off contracting, and focus spending on front-line services. On energy, Reform’s local and national messaging is built around making bills more predictable and cheaper by removing carbon taxes and other levies tied to Net Zero targets, with a headline aim of saving households about £500 a year as part of a coherent long-term energy strategy to replace current excuses. The wider pitch is that domestic oil and gas should be used more, to reduce exposure to global shocks and help with the cost of living.

At the same time, energy bills don’t exist in isolation. Reform UK Durham also links the pressure on household budgets to tax and wages, including a proposal to lift the income tax starting threshold to £20,000, framed as a way to help lower-paid workers keep more of what they earn.

Imagine waking up to a country where integrity leads and promises are kept, where your concerns set the agenda. If you’re ready for action instead of excuses, Join Reform UK, help shape decisions locally, and back a plan that puts Durham households first. When election day comes, Vote Reform UK for straight answers on bills, services, and accountability, and for a politics that says what it means. The goal is simple, Make Britain Great Again, starting with basics like energy you can afford.