Energy bills to fall by £129 for UK households as Ofgem confirms new price cap
This will come into effect from from 1st July to 30th September 2025, meaning for a typical household, this will reduce their energy bills by £11 a month.
It says the reason for this is that global wholesale prices for energy have gone down, adding: 'While this is the main cause, changes to supplier business costs have also made an impact on energy prices falling.'
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The price cap, which dictates the maximum price firms can charge per unit of energy, currently sits at £1,849 for an average household.
Initially, insiders were expecting a dip of 9%, and while this isn't as big a drop as some might have hoped, it will be welcome news for UK households.
David Belle, Founder and Trader at Fink Money responded to the price cap change, saying: "A large part of the increase in CPI was due to the energy price cap.
"However a large offsetter was motor fuel costs dropping. I track wholesale energy costs and it hasn't increased. How can motor fuel costs drop while wholesale energy costs have apparent gone up, leading to the price cap increase?
"It doesn't make sense, and I think OFGEM have been found out here to be wholly working in the interests of energy firms who are still recovering pandemic debts, which now is why they're dropping the price 7%.
"They are an abysmal regulator and it's time they were brought to justice."
Craig Lowrey, principal consultant at Cornwall Insight, also stated: "The fall in the price cap is a welcome development and will bring much-needed breathing space for households after a prolonged period of high energy costs."
He added: "It's a step in the right direction, but it should be taken in context.
"Prices are falling, but not by enough for the numerous households struggling under the weight of a cost-of-living crisis, and bills remain well above the levels seen at the start of the decade.
"As such, there remains a risk that energy will remain unaffordable for many."
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