The UK’s energy services regulator has lowered its price cap to reflect recent declines in wholesale prices, but warned that the cap remains above pre-energy crisis levels and that many households could still have difficulty paying bills.
The annual amount suppliers can charge the average household fell to $2,550 (GBP 2,074) in the third quarter, from $4,040 (GBP 3,280) in April to June, the Gas Markets Office said, and Electricity (Ofgem) in a press release. The figures are based on the typical consumption of dual fuel households paying by direct debit.
“Today’s update means that for the first time since the global gas crisis hit more than 18 months ago, prices are coming down for customers on default tariffs,” he said.
The revision, which was down more than twice from a peak of $5,270 (£4,279), was announced a day after the Office for National Statistics (ONS) reported a fall in annual energy costs domestic The consumer price index inflation rate for housing and household services (water, electricity, gas and other fuels) stood at 12.3% in April 2023, below 26.1% of the previous month and 13.2% in April 2022.
Gas prices fell by one per cent between March and April, the first month-on-month drop in gas prices since October 2020, the ONS said. The same period a year ago saw a 66.8 percent increase in gas prices.
Electricity prices also decreased by 1.1 percent between March and April 2023, after rising 40.5 percent in the same period in 2022.
“People should start seeing cheaper energy bills from the start of July, and this is a welcome step towards reducing costs,” Ofgem chief executive Jonathan Brearley said in the announcement.
But the agency warned that while the price cap fell since the last quarter, it “is still above pre-energy crisis levels, meaning many households could still struggle to pay the bills.”
“While the price cap has come down from its winter peak, it remains well above the pre-2021 average, and many people will still find such high bills difficult to pay,” he said, calling for “more focus ” by the government and the government. industry to help the most vulnerable this winter.
Brearley said: “When people are experiencing difficulties, we urge them to contact their provider, who will be able to offer a range of support, such as payment plans or access to hardship funds.
“In the medium term, it is unlikely that prices will return to the levels we saw before the energy crisis and so we believe it is imperative that the government, Ofgem, consumer groups and the wider industry work together to give support for vulnerable groups”. .
To contact the author, please email jov.onsat@rigzone.com
