Energy bills to fall after Ofgem announces price cap reduction

Ofgem has decreased the energy price cap to £1,923.

Energy bills will fall in the UK after Ofgem announced a reduction to the energy price cap.

From October 1, the average household energy bill will hit £1,923, the regulator said on Friday.

The change comes after the wholesale price of gas continued to dip.

The price cap is currently set at £2,074.

Ofgem said it was cutting the price that a supplier could charge for gas from 6.9p per kilowatt hour (kWh) today to 6.89p from October 1.

The price of electricity will fall from 30.1p per kWh to 27.35p.

This means that the average household bill will end up at around £1,923 per year, according to the regulator’s calculations.

But that is still more than £600 higher than in the winter of 2021 when the average household energy bill was £1,277.

Because the cap decides the per unit charge, households that use more will pay more.

This is based on an estimate that the average household uses 2,900 kWh of electricity and 12,000 kWh of gas.

Ofgem chief executive Jonathan Brearley said: “It is welcome news that the price cap continues to fall, however, we know people are struggling with the wider cost of living challenges and I can’t offer any certainty that things will ease this winter.”

Brearley said that now that energy prices were easing, Ofgem had allowed suppliers to earn a little more money off their customers.

“This means there should be no excuses for suppliers not to be doing all they can to support their customers this winter, and to reinforce this we’ll be introducing a consumer code of conduct which we will look to have in place by winter,” he added.

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