Gas vs Electricity Unit Costs: Why Your Electric Bill Is 4x Higher Per kWh
The Price Gap Between Gas and Electricity
If you've ever wondered why your electricity usage seems to cost so much more than gas, the numbers tell a clear story. As of April 2026, electricity costs 24.67p per kilowatt-hour (kWh) while gas costs just 5.74p per kWh[1]. That means electricity is more than four times more expensive per unit of energy than gas.
Why is electricity more expensive than gas?
Electricity is more expensive than gas because electricity costs 24.67p per kWh while gas costs just 5.74p per kWh as of April 2026, making electricity over four times more expensive per unit. This price difference stems from complex electricity generation costs, expensive infrastructure requirements, and market structures where the costliest generation source often sets the wholesale price for all electricity.
This significant price difference has a major impact on how much you pay for heating, cooking, and powering your home. Understanding why this gap exists and how it affects your monthly bills is crucial for making informed decisions about your energy usage and supplier choices.
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Compare Energy DealsCurrent Energy Pricing Under the Ofgem Cap
The UK's energy prices are regulated by Ofgem through the energy price cap, which sets the maximum amount suppliers can charge for each unit of gas and electricity. From 1 April to 30 June 2026, the energy price cap for a typical dual-fuel household paying by Direct Debit is set at £1,641 per year, representing a 7% decrease from the previous quarter[1].
The price cap also sets daily standing charges, which you pay regardless of usage. Currently, the electricity standing charge is 57.21p per day, while gas is 29.09p per day[1].
How Major Suppliers Compare
Because of the price cap, all major energy suppliers charge the same rates for their standard variable tariffs. Here's how the current pricing breaks down across the big suppliers:
| Supplier | Gas Unit Rate (p/kWh) | Gas Standing Charge (p/day) | Electricity Unit Rate (p/kWh) | Electricity Standing Charge (p/day) |
|---|---|---|---|---|
| EDF Energy | 5.74 | 29.09 | 24.67 | 57.21 |
| British Gas | 5.74 | 29.09 | 24.67 | 57.21 |
| E.ON Next | 5.74 | 29.09 | 24.67 | 57.21 |
| Scottish Power | 5.74 | 29.09 | 24.67 | 57.21 |
| SSE Energy Services | 5.74 | 29.09 | 24.67 | 57.21 |
While standard rates are identical, suppliers may offer different fixed-rate deals or off peak electricity tariffs that can provide savings for certain usage patterns.
Why Electricity Costs So Much More Than Gas
The substantial price difference between electricity and gas stems from several key factors in how energy markets operate in the UK.
Electricity Generation Costs Set the Price
Electricity in the UK comes from a diverse mix of sources including renewables, nuclear, and fossil fuels. However, the costliest source of generation often sets the price for all electricity, even when cheaper renewable sources are also contributing to the grid[2]. When gas-fired power stations are needed to meet demand, their higher operating costs influence the wholesale price of all electricity.
Complex Infrastructure Requirements
The infrastructure needed to generate, transmit, and distribute electricity is significantly more complex and expensive than gas distribution networks. This includes power stations, transmission lines, substations, and the sophisticated grid management systems needed to balance supply and demand in real-time.
Market Structure and Global Influences
Electricity prices are heavily influenced by global energy markets, including the costs of raw materials for generation and international supply and demand dynamics. The UK's electricity market structure means that wholesale prices can fluctuate significantly based on these external factors.
Calculating Which Fuel Costs You More Each Month
To determine whether gas or electricity is your bigger monthly expense, you need to look at both your usage patterns and the current pricing structure. Here's how to work it out:
Step 1: Find Your Monthly Usage
Check your energy bills or online account to find your monthly consumption in kWh for both electricity and gas. If you only have annual figures, divide by 12 for a rough monthly average.
Step 2: Calculate Unit Costs
Multiply your monthly consumption by the current unit rates:
- Electricity cost: Monthly kWh × 24.67p
- Gas cost: Monthly kWh × 5.74p
Step 3: Add Standing Charges
Include the daily standing charges for the number of days in the month:
- Electricity standing charge: 57.21p × days in month
- Gas standing charge: 29.09p × days in month
Real Example Calculation
Let's look at a household using 300 kWh of electricity and 800 kWh of gas in a typical 30-day month:
Electricity costs:
- Unit cost: 300 kWh × 24.67p = £74.01
- Standing charge: 57.21p × 30 days = £17.16
- Monthly total: £91.17
Gas costs:
- Unit cost: 800 kWh × 5.74p = £45.92
- Standing charge: 29.09p × 30 days = £8.73
- Monthly total: £54.65
In this example, despite using more gas than electricity by volume, the electricity bill is still £36.52 higher due to the much higher unit rate.
How Usage Patterns Affect Your Total Bill
The impact of the electricity-gas price difference varies dramatically depending on how your household uses energy. Homes that rely heavily on electric heating will see electricity dominate their bills, while those with gas central heating and gas cooking may find their costs more evenly split.
For instance, a household using 6,000 kWh of electricity and 6,000 kWh of gas annually would pay approximately £1,480 for electricity and £344 for gas, totaling £1,824 per year. In contrast, a more gas-reliant household using 3,000 kWh of electricity and 12,000 kWh of gas would pay roughly £740 for electricity and £688 for gas, totaling £1,428 annually.
When Off Peak Electricity Tariffs Make Sense
If you have flexibility in when you use electricity, off peak electricity tariffs like Economy 7 can help reduce costs. These tariffs offer cheaper electricity rates during specific hours, typically overnight, which can be particularly beneficial if you have electric heating or can run appliances like washing machines and dishwashers during off-peak periods.
Finding Better Energy Deals
While the price cap sets maximum rates, some suppliers offer competitive fixed-rate deals that can provide savings or price certainty. Whether you're comparing British Gas vs Octopus Energy or considering other providers, it's worth regularly reviewing your options.
The process of switching suppliers has become much simpler in recent years. Services like Lodo can handle the switching process for you, taking the complexity out of comparing tariffs and managing the paperwork involved in changing suppliers.
Let Lodo Handle the Switch for You
Now that you understand how gas and electricity pricing works, finding the best tariff for your specific usage pattern becomes crucial for minimising your monthly bills. Lodo specialises in energy switching and understands the nuances of different suppliers' offerings, including which providers offer the most competitive rates for high electricity users versus gas-heavy households.
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Try Lodo FreeKey Takeaways for Managing Energy Costs
Understanding the 4:1 price ratio between electricity and gas helps explain why certain energy choices have such different cost implications. Electric heating, electric cooking, and high electricity usage will have a much more significant impact on your bills than equivalent gas usage.
By calculating your monthly costs for each fuel type using the current unit rates and standing charges, you can identify where your money is going and make informed decisions about usage patterns, appliance choices, and supplier switches. Whether you're a new tenant energy supplier shopping or looking to optimise your existing setup, knowing these fundamentals puts you in control of your energy expenses.
How much does the price difference actually cost you monthly?
The 4:1 price ratio means electricity dominates most energy bills despite lower usage volumes. A typical household using 300 kWh of electricity and 800 kWh of gas monthly pays £91.17 for electricity versus £54.65 for gas, with electricity costing £36.52 more despite using less than half the volume of energy.
Which heating method costs less - gas or electric?
Gas heating is significantly cheaper than electric heating due to the price difference. A household using electric heating might consume 6,000 kWh of electricity annually costing £1,480, while the same heating needs met with gas at 6,000 kWh would cost just £344 - a difference of over £1,100 per year.
What are the current electricity and gas unit rates in the UK as of April 2026?
As of April 2026, the average electricity unit rate is 24.67p per kilowatt hour (kWh), and the average gas unit rate is 5.74p per kWh, inclusive of VAT. These rates are set by Ofgem's energy price cap, which is reviewed quarterly.
Why is electricity more expensive per unit than gas in the UK?
Electricity prices in the UK are often higher than gas prices because the wholesale cost of electricity is influenced by the most expensive source of generation, typically gas-fired power stations. This pricing structure means that even cheaper renewable electricity is priced higher during gas price surges.
How does the UK's energy price cap affect electricity and gas bills?
The energy price cap, set by Ofgem, limits the maximum amount suppliers can charge for each unit of gas and electricity and the daily standing charge. For the period from 1 April to 30 June 2026, the cap for a typical dual-fuel household paying by Direct Debit is £1,641 per year, reflecting a 7% decrease from the previous quarter.
What are the average standing charges for gas and electricity in the UK as of April 2026?
As of April 2026, the average daily standing charge for gas is 29.09p, and for electricity, it is 57.21p. These charges are part of the energy price cap set by Ofgem.
How do off-peak electricity tariffs work in the UK?
Off-peak electricity tariffs, such as Economy 7, offer lower rates during specific hours, typically at night, to encourage usage during periods of low demand. These tariffs can help reduce electricity costs for households that can shift their energy-intensive activities to off-peak times.
How can I determine which fuel type is costing me more each month based on my usage patterns?
To determine which fuel type is costing more, compare your monthly usage and costs for both gas and electricity. Review your energy bills or contact your supplier for detailed usage data, and consider using online calculators or consulting with an energy advisor to assess your consumption patterns.
What factors contribute to the higher cost of electricity compared to gas in the UK?
The higher cost of electricity in the UK is influenced by factors such as the reliance on gas-fired power stations for electricity generation, which sets the wholesale price, and the structure of the electricity market, where prices are often determined by the most expensive source of generation.
How do network costs impact electricity and gas pricing in the UK?
Network costs, which cover the maintenance and operation of the energy infrastructure, are included in both electricity and gas bills. These costs contribute to the overall pricing structure and can vary based on factors such as location and usage patterns.
What is the role of the energy price cap in regulating electricity and gas prices in the UK?
The energy price cap, set by Ofgem, regulates the maximum amount suppliers can charge for each unit of gas and electricity and the daily standing charge. It is reviewed quarterly to reflect changes in wholesale energy costs, network costs, and other factors, aiming to protect consumers from excessive charges.
Sources
- Ofgem - Energy price cap explained. Available at: https://www.ofgem.gov.uk/information-consumers/energy-advice-households/energy-price-cap-explained
- Homebuilding.co.uk - Why your energy bill still follows gas prices and how pot zero could change that. Available at: https://www.homebuilding.co.uk/news/why-your-energy-bill-still-follows-gas-prices-and-how-pot-zero-could-change-that