Energy bills ‘to fall’ for millions of households in WEEKS say experts – how you can save now

MILLIONS of households will soon breathe a new sigh of relief as energy bills are predicted to fall again in July.

Analysts at Cornwall Insight said the average gas and electricity bill will fall to £1,720 from July, representing a drop of 7% on April’s price cap.

GettyOver 22million households are on standard variable tariffs remain directly impacted by the price cap which changes every three months[/caption]

If the final forecast is correct, it would reduce the average customer’s bill by £129.

However, it would still be £37 higher than earlier predictions from experts.

Nevertheless, the savings will still provide relief to millions, as over 22million households on standard variable tariffs are directly affected by the price cap, which is updated every three months.

Dr Craig Lowrey, principal at consultant at Cornwall Insight, said: “The fall in the price cap is a welcome development and will bring much-needed breathing space for households after a prolonged period of high energy costs.

“It’s a step in the right direction, but it should be taken in context.

“Prices are falling, but not by enough for the numerous households struggling under the weight of a cost-of-living crisis, and bills remain well above the levels seen at the start of the decade.

“As such, there remains a risk that energy will remain unaffordable for many.”

Currently, the price cap sets annual energy costs at around £1,849.

However, many households may still pay more than Ofgem‘s headline figure.

This is because the price cap doesn’t cap total bills but limits the maximum cost per kilowatt-hour (kWh) of gas and electricity, along with daily standing charges.

Ofgem’s headline figure is based on the assumption that a typical household consumes 2,700 kWh of electricity and 11,500 kWh of gas annually.

So if you use more than a typical households expect to pay more.

However, energy experts suggest that households could make significant savings by switching to a fixed-rate energy deal now.

Richard Neudegg, director of regulation at Uswitch.com, said: “The expectation of a drop in July’s price cap is welcome news.

“But any household still on the standard variable tariff should ditch it well before then.

“There are a number of fixed deals on the market already cheaper than the predicted July rates, and we’re seeing the biggest savings versus the price cap since autumn 2020.

“The average household on a standard tariff could save around £332 a year by switching compared with the current price cap, which also beats the latest July prediction by around £200 per year.”

By choosing a fixed deal, customers can lock in consistent rates for a set period, potentially avoiding fluctuations in energy prices.

Of course, opting for a fixed energy deal carries the risk that, if energy prices drop further, you might end up paying more than you would on a variable tariff.

However, analysts have long said that households should not anticipate any significant drops in prices this year.