Exact date that energy bills could drop by £300 a year – everything you need to know
ENERGY bills could be hundreds of pounds lower in the second half of this year, according to experts.
The average household's energy bills might hit around £2,200 a year from July.
This is £300 less than previously thought, experts at Cornwall Insight said.
It is around the same as an average family pays today after the Government support has been factored in.
Without backing from the Government the average household would pay £4,279 per year for their energy bills between January and April – the level of the Ofgem price cap.
But the Government has overridden the price cap with a promise to pick up the difference and ensure that average bills are £2,500.
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It has also been sending £400 to every household in the country between October and March.
From April the support gets less generous and will only reduce average bills to £3,000.
The new forecasts, from Cornwall Insight, suggest that Ofgem’s price cap will be set at £3,209 from the start of April.
This is around £300 less than its previous forecast just two weeks ago.
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This will not reduce the amount that households pay, as it will still be overridden by the less generous Government guarantee.
It will however mean that the guarantee costs the Government less money.
After that, the price cap will fall again to £2,201 from July and rise slightly to £2,241 from October to the end of the year, the energy consultancy said.
If these forecasts come true, it will mean that the Government support for energy bills in practice ends in July as bills will naturally be lower than the cap that ministers have promised to enforce.
Gas prices have plummeted in recent weeks, and have more than halved since early December.
But while wholesale gas is cheaper than it has been for over a year at around 150p per therm, this is still around three times higher than at the beginning of 2021.
Dr Craig Lowrey, principal consultant at Cornwall Insight, warned that things could rapidly turn around again if global markets get spooked.
“As our price cap forecasts fall yet again, it is only natural that people will begin to assume our predictions will stay on a downward trajectory,” he said.
“But we really don’t have a precedent to look at to work out how the market will evolve in 2023.”
What other help is available?
As part of the Autumn Statement, it was revealed millions on benefits and Universal Credit will receive an extra one-off £900.
Eight million households have already received cost-of-living payments worth up to £650.
Pensioners have also started getting a £300 one-off payment.
The current pensioner cost of living payment is being handed out to millions on a low income.
You qualify under the current rules if you normally get the winter fuel payment, but this could change under the new rules.
The £300 cost of living payment is paid on top of the other winter support.
Struggling families are eligible for the Warm House Discount to help them tackle the cost of living.
There are also plenty of energy grants and schemes open to help you out if you're struggling:
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- British Gas Energy Trust Individuals and Family Fund
- British Gas Energy Trust
- EDF Customer Support Fund
- E.ON and E.ON Next Grants
- Octopus Energy Assist Fund
- OVO Energy
- Scottish Power Hardship Fund
There's also a one-off fuel voucher from your energy supplier if you're on a prepayment meter.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]