Home energy bills to fall after Ofgem lowers gas and electricity price cap

Energy costs will fall for millions of British households this summer after the industry watchdog cut the price cap for a typical annual dual-fuel bill by 7% to £1,720.

- Jillian Ambrose

The energy regulator for Great Britain, Ofgem, said the cap on gas and electricity charges would fall from July by the equivalent of £129 a year for the average home. Despite the drop, which follows three consecutive quarterly increases, the typical household will still pay about £600 a year more than before Russia's invasion of Ukraine three years ago.

About 9m households that buy energy through variable tariffs will see an immediate impact on their bills when the cap takes effect in July. But households could still face higher bills if they use more than the typical amount of energy. This is because the cap, which is recalculated every three months, limits the rate suppliers can charge customers for each unit of gas and electricity - not the total bill.

Ofgem said it was able to lower the cap after a slump in gas market prices across Europe, which has helped to cut costs for energy suppliers.