From today, energy bills are falling for around 21 million households in England, Scotland and Wales. Regulator Ofgem has lowered the price cap, cutting the typical dual-fuel bill by 7%, or £11 a month. This brings the average annual bill for a household using a standard amount of gas and electricity to £1,720.
However, this drop comes with caution. With colder, darker months ahead, households still face the risk of higher winter bills. Ofgem and energy analysts encourage people to consider fixed tariffs, which can provide payment certainty and save around £200 a year.
Currently, 35% of households are on fixed deals – up from 15% a year ago – but these only lock in the unit rate. Actual bills still depend on how much energy you use.
Under the new cap, gas prices fall from 6.99p to 6.33p per kilowatt hour (kWh), and electricity from 27.03p to 25.73p. Daily standing charges have also dropped slightly, averaging 51.37p for electricity and 29.82p for gas.
The price cap doesn’t apply in Northern Ireland, which has a separate energy market. Customers on pre-payment meters will now pay a typical annual bill of £1,672, while those paying by cash or cheque face £1,855.
Although another small drop is forecast for October, energy consultancy Cornwall Insight warns of “significant uncertainty”, particularly with global pressures affecting wholesale prices. Ofgem is currently reviewing standing charges, which continue to spark debate.
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