The energy price cap is set to fall again, according to a closely-watched forecast, as the energy regulator has said the average home is using less energy.
The average household will be paying roughly £200 less from autumn than they are from next month, energy research specialist Cornwall Insight said.
Ahead of Ofgem’s new price cap coming into effect on Saturday 1 July, the research firm said it saw the cap for a typical household at the equivalent of £1,871 per year from October to the end of December.
That’s a decrease from the £2,053 cap in effect from July to the end of September and the £3,280 level set by Ofgem for March to June.
Bill payers were not subject to the average £3,280 bill as a government scheme, called the energy price guarantee, limited a typical household’s energy bill to £2,500 equivalent per year. This scheme ends on Friday.
While wholesale gas prices and electricity bills are falling, the main reason the average bill is coming down is because from October, Ofgem will revise downwards how much gas and electricity the average house consumes.
Every two years Ofgem reviews typical domestic energy consumption but this was interrupted due the COVID-19 pandemic.
Using data on the average usage from 2019 and 2021, due to missed pandemic years, the regulator concluded residences in the UK are using less electricity and gas.
That reduction is due to rising energy prices, energy saving measures and weather.
The official price cap announcement for October will not be made until late August. But the price cap model came in for criticism by Cornwall Insight.
