Energy bills are projected to decrease by £117 annually for the average household starting this April. According to Cornwall Insight, the Ofgem price cap is anticipated to drop from £1,758 per year to £1,641 for a standard dual fuel residence, slightly lower than the initial estimate of a £138 reduction. This decline is attributed to governmental measures introduced in the previous November Budget.

Chancellor Rachel Reeves disclosed that £150 would be shaved off energy bills from April by discontinuing the Energy Company Obligation (Eco) scheme. Nonetheless, Cornwall Insight highlighted that after factoring in VAT and pricing allowances, the actual reduction would be around £145 per year.

Part of the savings has been offset by certain charges related to maintaining Britain’s energy networks. Cornwall Insight noted that wholesale prices have slightly risen due to geopolitical factors, expecting the price cap to remain relatively stable throughout 2026. They foresee a minor increase in energy costs in July.

Craig Lowrey, principal consultant at Cornwall Insight, expressed positivity regarding the bill reduction, emphasizing the importance of easing financial burdens amid ongoing affordability concerns. He mentioned that policy cost reductions, due to government interventions, have been instrumental in driving down bills, despite recent headlines on wholesale costs.

Lowrey stressed the necessity of investing in a more secure and resilient energy system, pointing out the costs associated with transitioning to such a system. Ofgem is set to announce the next price cap on February 25, covering the period from April 1 to June 30. This cap regulates the unit rates of gas and electricity as well as standing charges but does not impose a total limit on energy charges based on consumption.

Uswitch indicated that all households will witness bill adjustments in April, irrespective of their tariff type. However, the savings will vary depending on individual energy usage, with lower consumption households seeing smaller reductions compared to higher usage ones.

A spokesperson for the Department for Energy Security and Net Zero affirmed the government’s commitment to reducing costs by £150 per bill from April 1, with the final price cap figure soon to be disclosed by Ofgem.