Personal Finance

Energy bills to drop by £293 a year under new Ofgem price cap

The average UK household looks set to save around £293 a year when Ofgem announces the new price cap.

Energy bills will drop to their lowest in level for more than two years from April 1, bringing some long-awaited good news for families amid the cost-of-living crisis.

Cornwall Insight has forecast the average family will pay £1,635 from April. A 15% drop from the current average cost of £1,928 per year.

Cornwall Insight’s forecast, which noted that the UK’s energy prices look to have weathered disruption in the Red Sea, is normally very close to Ofgem’s announcement, as both are based on publicly available data.

However, the firm warned that as long as the UK is reliant on fossil fuels it will have to continue importing expensive gas from countries which could decide to stop selling to Britain.

While the forecast from Cornwall is considerably lower than the current price cap, it is marginally higher than the £1,620 that the consultancy forecast just over a month ago.

Cornwall Insight principal consultant Dr Craig Lowrey said that despite the predicted fall, prices would remain a struggle for many and remained hundreds of pounds above pre-pandemic levels.