The energy price cap will fall from £2,074 to £1,923 after wholesale costs dropped, Ofgem said today – but campaigners warned bills were still unaffordable high

The energy price cap will fall from £2,074 to £1,923 after wholesale costs dropped, Ofgem said today – but campaigners warned bills were still unaffordable high.

Charities want an ‘urgent reboot’ of the energy market despite the regulator saying it will cut the price a supplier can charge for gas from 6.9p per kilowatt hour (kWh) today to 6.89p from October 1.
Electricity will fall from 30.1p per kWh to 27.35p.

The average household bill will now end up at around £1,923 per year, according to Ofgem’s calculations. Customers on prepayment meters will pay £1,949 on average.

The cap is the per unit charge, so people using more will pay more.

It is based on an estimated 2,900 units of electricity and 12,000 units of gas for the average home.

The drop in the cap for England, Wales and Scotland appears at first glance to be good news for households. Last winter the cap was de facto superseded by the Government’s Energy Price Guarantee which kept the average bill at £2,500.

But on top of that the Government was also paying about £66 per month towards each household’s energy bill.

This support is not there this winter, meaning many households will be paying more every month this winter than they were last winter.

And the Resolution Foundation think tank warned that over a third of households across England, 7.2 million in total, would still face higher bills this winter than last. 

Labour said today’s new cap showed the ‘Tory cost-of-living crisis is still raging for millions of people’ – while consumer group Which?

said bills are ‘significantly higher than they were before the energy crisis began’, even with the drop announced today.

The charity Scope said energy still costs ‘more than double what it did two years ago and bills remain excruciatingly high’, while the Money Advice Trust lamented the ‘extremely worrying time for people who have fallen behind on their energy bills’.

And campaigners at the charity National Energy Action issued a warning that the price cap will not stop 6.3million UK households from being trapped in fuel poverty. 

Last week experts at Cornwall Insight, an energy consultancy, said they had expected gas to fall to 6.9p and electricity to just under 27p.