Ofgem consults on changes to clean-power costs within the price cap

Representative editorial image of a smart meter and electricity network for the Ofgem price-cap consultation

Ofgem has opened a consultation on two technical changes to the Contracts for Difference allowance within the energy price cap. Published on 2nd November 2026, the consultation closes on 20th November.

Current position

The regulator proposes basing the allowance on forecast payments for the coming quarter, replacing a calculation using four quarters. It also proposes incorporating government funding intended to mitigate the effect of the Business Industrial Competitiveness Scheme on domestic consumers.

Why this matters

The proposals concern how costs associated with clean-power contracts are reflected in capped household tariffs. They do not establish a new grant for buildings or guarantee a particular reduction in household bills. Consumer groups and charities are among those invited to respond.

Next steps

If agreed, Ofgem aims to introduce the industrial-scheme adjustment in the April to June 2027 cap period. The simplified calculation would follow when the necessary arrangements are ready. Both remain proposals subject to consultation. Responses are due by 20th November 2026; no closing time is stated on the landing page.

Primary source: Ofgem consultation, dated 2nd November 2026.

Read the primary source

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