Energy price cap to dip by 7% from July, regulator reveals
Households on the energy price cap will see a 7% reduction in their average annual payments from 1 July, the industry regulator has announced.
The default cap - which is reviewed every three months - will see a typical household using gas and electricity and paying by Direct Debit stump up an average annual £1,720, Ofgem said.
That is down from the current April-June figure of £1,849 and reflects a reduction in wholesale gas prices.
The lower cap does not affect the millions of households to have taken a time-limited fixed deal.
Nevertheless, it represents some relief for families grappling the cost of living aftershock that saw many essential bills rise by well above the rate of inflation last month.
Ofgem's announcement was made just days after fresh forecasts suggested that bills linked to the cap could come down further from both October and January, given recent wholesale market price trends.
Prices last winter had been relatively stable until a cold snap hit much of Europe in January and early February, driving up demand at a time of weaker stocks.
Other risk factors include extended EU gas storage rules and global conflicts, not least the continuing Russia-Ukraine war that sparked the 2022 energy price spike and cost of living crisis in the first place.
Tim Jarvis, director general of markets at Ofgem, said: "A fall in the price cap will be welcome news for consumers, and reflects a reduction in the international price of wholesale gas. However, we're acutely aware that prices remain high, and some continue to struggle with the cost of energy.
"The first thing I want to remind people is that you don't have to pay the price cap - there are better deals out there so it's important to shop around, and talk to your existing supplier about the best deal they can offer you. And changing your payment method to direct debit or smart pay as you go can save you up to £136."
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