The energy price cap in Great Britain will fall by £238 to £1690 this spring as a mild winter and lower gas prices ease pressure on household finances.
The 29 million households in England, Wales and Scotland can expect to pay the average annual bill from April after the energy regulator Ofgem dropped the price cap from £1,928 in the current quarter.
Wholesale gas prices have fallen as a mild winter in Europe reduced demand, helped by plentiful supplies of liquified natural gas in Europe and Asia, leading to a fall in household bills.
The average household will still pay far more for their gas and electricity than before the energy crisis, which started in 2021 and escalated after Russia’s invasion of Ukraine two years ago. The cap for customers paying by direct debit was £1,309 in the summer of 2021, before the crisis began.
The new rate will apply from April to June before it is adjusted again in July. However, the cap does not limit the amount customers pay: those who use more energy pay more.
The energy consultants Cornwall Insight expect the cap to fall again in July, to £1,462, before rising to £1,521 from October.
Analysts had feared disruption to cargoes in the Red Sea could push gas prices significantly higher but rises have not materialised so far.
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