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£10.99A reduction in energy prices is anticipated to result in a decrease of over £100 per year for consumers, marking the first drop in a year. The price cap set by energy regulator Ofgem, which is revised every three months, impacts the energy bills of 22 million households in England, Scotland, and Wales. Analysts are predicting a decrease of more than £100 in the annual bill for a household consuming a standard amount of gas and electricity. Despite the positive news of cheaper bills, many individuals still face challenges in meeting their energy payment obligations, with millions of customers collectively owing approximately £4 billion to suppliers.
Ofgem is scheduled to reveal the price cap for July through September at 07:00 BST. It is important to note that the price cap does not affect Northern Ireland, as it operates on its own energy market. Over the past few months, the regulator has observed fluctuations in the price cap which have a significant impact on the annual bills for households consuming an average amount of gas and electricity. According to analysts at Cornwall Insight, there is an expected drop of £129 in the annual bill, representing a nearly 7% decrease.
While the reduction in energy prices is a welcome relief for consumers, bill levels are still higher compared to a year ago and notably above levels seen at the beginning of the decade. The surge in energy costs in recent years has resulted in a sharp increase in customer debt to suppliers, with an outstanding total of just under £4 billion. Matthew Cole, Chief Executive of the Fuel Bank Foundation, highlighted that despite the slight decrease in prices, individuals facing financial vulnerability continue to grapple with accumulated energy debt and the enduring cost of living challenges.
The news of the price cap adjustment comes in the wake of Prime Minister Sir Keir Starmer’s announcement regarding a shift in policy on winter fuel payments. Last year, more than 10 million pensioners saw a reduction in payments, leading to dissatisfaction among recipients. Sir Keir’s recent statement in the Commons hinted at restoring eligibility for the payments to a larger portion of pensioners, although details on the extent of this change, the implementation timeline, and the exact criteria for eligibility remain unclear
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