Energy cap cut gives families £400-a-year lifeline

FAMILIES were given a £400-a-year lifeline today after the cap on energy bills was cut following steep falls in wholesale gas and electricity prices

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Energy regulator Ofgem set the cap on average annual bills at £2,074 for the third quarter starting July, down from £3,280 from April to June.

It is in effect a cut of £426 a year as average bills currently cannot go above the £2,500 energy price guarantee put in place by Liz Truss when she was prime minister last September after Russia’s in vasion of Ukraine sent market prices spiralling to record levels.

Today’s sharp fall in the cap — a mechanism put in place by Theresa May’s government to protect consumers on “default” standard variable tariffs — represents the biggest single easing of the financial pressure on families since the cost of living crisis began in 2021.

However, prices are still almost double where they were before the war started and there were warnings today people may still pay as much for energy this winter as they did last year.