Households vitality payments to drop from April after Ofgem vitality value cap is lowered | EUROtoday

Household vitality payments are set to drop in April after vitality regulator Ofgem lowered the vitality value cap by seven per cent.

The discount aligns with Chancellor Rachel Reeves’ promise that £150 could be reduce from the common family invoice.

Ofgem introduced on Wednesday morning that it had lowered the vitality value cap by £117 to £1,641 a yr for a typical twin gas family.

Sir Keir Starmer mentioned: “Energy bills are at the front of everybody’s mind, and I know they’ve been too high for too long.”

The prime minister mentioned the worth cap drop will imply decrease vitality payments for thousands and thousands throughout the UK, however added that “there is more to do and my government is pulling every lever to bear down on the cost of living and protect the pound in the pockets of working people.”

The vitality regulator estimated the change to the vitality value cap amounted to a discount of round £10 a month for the common family utilizing each electrical energy and gasoline.

open picture in gallery

In November, Ms Reeves promised to chop £150 from the common family invoice from April. On Wednesday, she mentioned: “Cutting the cost of living is this government’s number one priority and I know energy bills are one of the biggest concerns, that’s why at the budget I said we would bear down on energy bills.”

The value cap, which was first launched by the regulator in 2019, limits the utmost quantity vitality suppliers can cost for every unit of gasoline or electrical energy used.

It additionally units a most each day standing cost – the price of having your property related to the grid.

The headline value cap determine of £1,641 supplied by Ofgem signifies what a family utilizing gasoline and electrical energy, and paying by direct debit, can count on to pay if their vitality consumption is typical.

Energy secretary Ed Miliband mentioned the vitality value cap drop was “happening because of the actions we took in the budget”, however added to Sky News, that the federal government is aware of it has “got further to go”.

He mentioned: “The price cap in 2025 across the year was lower in real terms than 2024. We want to drive it down even lower, so it’s up to £300 lower.”

open picture in gallery

Tim Jarvis, director normal of markets at Ofgem, mentioned: “The main driver of today’s reduction is the change to policy costs announced by the chancellor in the budget.

“Our focus at Ofgem remains on bearing down on the costs within our control and unlocking the investment needed to support the transition to a more stable energy system over the longer term.”

It is necessary to notice that it doesn’t restrict a house’s whole payments as a result of individuals nonetheless pay for the quantity of vitality they use – so whether it is above the common they are going to pay extra, and whether it is under they are going to pay much less.

Speaking earlier than the vitality value cap announcement, Which? vitality editor Emily Seymour mentioned: “Households can expect a significant cut to their energy bills in April, which will come as a relief to millions of people struggling with cost-of-living pressures.

“The bulk of this change is expected to be applied to your electricity price per unit, so your exact savings will depend on your usage; look out for communications from your energy provider in the coming weeks to see how it will affect your bills.”