Ofgem price cap news: Energy bills to fall as Martin Lewis reveals cheapest tariffs

Ofgem’s energy price cap to drop to lowest level in more than two years

Martin Lewis explains what Ofgem price cap slash really means for you

Martin Lewis has revealed the most cost-effective tariffs after Ofgem unveiled an energy price cap.

Households are set to pay £238 less a year in energy bills from April after Ofgem unveiled its energy price cap.

The best tariff deals, according to the money-saving expert, are E.on Next’s ‘Next pledge’ which remains 3% less than the cap and British Gas’s price promise which could be up to 12% less than the cap.

The money-saving expert says traditionally pre-payment was a rip-off however now they will be around 3% cheaper to equalise charges with direct debit payments.

He said on X: “Prepay, which many of the most vulnerable use, was always the rip off, so this is a staggering turnaround.

“And this is unlikely to be a flash in the pan - this pricing structure is likely to continue for the foreseeable future.”

He warned users on cap plans before moving to prepay deals as providers usually offer more competitive deals to direct debit customers.

The new price cap is set to fall by 12.3% from the current £1,928 to £1,690 from April 1 for a typical dual fuel household in England, Scotland and Wales.

Key points

• New price cap announced
• Ofgem chief explains price cap drop
• ‘Many people will struggle to pay off debts'

[23 February 2024 07:56 · Katy Clifton]

‘Many people will struggle to pay off debts'

The head of Citizens Advice welcomed Ofgem’s announcement this morning, but warned that “the impact of sky-high prices will be felt for years to come”.

Dame Clare Moriarty added: “It’s good news that the cost of energy is falling, but the impact of sky-high prices will be felt for years to come.

“We know more than five million people live in households behind on their energy bills and, with the price of energy still far higher than just three years ago, many people will struggle to pay off these debts.

“The government promised a new plan for energy bill support by April 2024, but will miss its own deadline. And the withdrawal of cost-of-living payments this spring will make it so much harder for many of those already finding it difficult to make ends meet. Without action, people will face a cycle of winter crises year after year.”

[23 February 2024 07:49 · Lydia Patrick]

Ofgem energy price cap: Everything you need to know

Ofgem has announced the latest price cap today as households prepare to see their energy bills fall to their lowest level in more than two years.

The fall will be £1,690 from April 2024 - a fall of £238 for the average dual-fuel household.

The change will come into effect in April, lasting three months until the end of June.

Read the full story here...

[23 February 2024 07:37 · Lydia Patrick]

Ofgem unveils price cap fall as households to pay less in energy bills

Households will see their energy bills fall to their lowest level in more than two years as regulator Ofgem announced a reduction in its price cap.

The fall, which comes amid the cost-of-living crisis, will be £1,690 from April 2024 - a fall of £238 for the average dual-fuel household.

The 12 per cent average fall is due to come into effect on 1 April and will last three months until the end of June.

Read the full story here...

[23 February 2024 07:24 · Katy Clifton]

Ofgem chief explains price cap drop

Ofgem chief executive Jonathan Brearley said: “This is good news to see the price cap drop to its lowest level in more than two years – and to see energy bills for the average household drop by £690 since the peak of the crisis – but there are still big issues that we must tackle head-on to ensure we build a system that’s more resilient for the long term and fairer to customers.

“That’s why we are levelising standing charges to end the inequity of people with prepayment meters, many of whom are vulnerable and struggling, being charged more up-front for their energy than other customers.

“We also need to address the risk posed by stubbornly high levels of debt in the system, so we must introduce a temporary payment to help prevent an unsustainable situation leading to higher bills in the future. We’ll be stepping back to look at issues surrounding debt and affordability across market for struggling consumers, which we’ll be announcing soon.

“These steps highlight the limitations of the current system – we can only move costs around – so we welcome news that the Government is opening the conversation on the future of price regulation, seeking views on how standard energy deals can be made more flexible so customers pay less if using electricity when prices are lower.

“But longer term we need to think about what more can be done for those who simply cannot afford to pay their energy bills even as prices fall. As we return to something closer to normality we have an opportunity to reset and reframe the energy market to make sure it’s ready to protect customers if prices rise again.”

[23 February 2024 07:22 · Katy Clifton]

New price cap announced

Good morning and welcome to our live updates on Ofgem’s energy price cap announcement.

The average household energy bill is to fall to its lowest point in two years from April after Ofgem lowered its price cap in response to wholesale prices.

The regulator announced it is dropping its price cap by 12.3% from the current £1,928 for a typical dual fuel household in England, Scotland and Wales to £1,690, a drop of £238 over the course of a year or around £20 a month.

Ofgem said the drop would see energy prices reach their lowest level since Russia’s invasion of Ukraine in February 2022, which caused a spike in an already turbulent wholesale energy market, driving up costs for suppliers and customers.