Average UK energy bill: households may see £117 off gas and electric bills as Ofgem expected to cut price cap

• Household energy bills are expected to fall by 7% from April 2026
• Ofgem is predicted to cut the typical dual-fuel bill by £117
• Government policy changes, not wholesale prices, have driven most of the savings
• But your actual savings will depend on your household’s energy usage
• Energy bills are likely to stay steady for the rest of 2026, with a small rise possible in July

Household energy bills are forecast to fall by 7% from April, offering some long-awaited relief to stretched budgets.

Energy analysts at Cornwall Insight predict that Ofgem will cut the energy price cap by £117, bringing the typical annual bill for a dual-fuel household down to £1,641 from Wednesday, April 1.

The new cap level, which will apply from April to the end of June, is due to be confirmed by Ofgem next week on Wednesday, February 25.

While the reduction is slightly smaller than earlier forecasts of an 8% drop, it still represents a meaningful saving for millions of households.

Why are bills falling?

The main driver behind the predicted reduction isn’t falling wholesale gas prices, at least not primarily. Instead, it’s Government intervention.

In her Autumn Budget, Chancellor Rachel Reeves announced plans to remove certain policy costs from bills, including scrapping the Energy Company Obligation (ECO) scheme in its current form.

At the time, the Treasury said this would cut average bills by £150 from April. According to Cornwall Insight, once VAT and pricing adjustments within the cap are factored in, the policy changes equate to around £145 off annual bills.

But rising costs linked to maintaining and operating Britain’s energy networks have eaten into some of that saving, leaving the net reduction closer to £117 under current forecasts.

Wholesale prices have edged up slightly in recent weeks, particularly gas, amid ongoing geopolitical tensions. Even so, they remain lower than when January’s price cap was set, limiting the impact on April’s level.

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What it means for you

If the forecast holds, every household on a standard variable tariff will see lower unit rates from April. Even customers on fixed deals may notice changes, as some suppliers adjust tariffs in response to the cap.

Comparison site Uswitch says all households will see an adjustment of some kind, regardless of supplier or tariff type. But the saving depends on how much energy you use.

The £1,641 figure is based on a “typical” household’s consumption. If you use less than average, your annual saving will be smaller than £117. If you use more, your saving will be higher.

Consumer groups are urging households not to focus solely on the headline annual figure. Instead, pay attention to the unit rates (the cost per kWh of gas and electricity) and standing charges, as these determine what you actually pay.

Will bills keep falling?

For now, forecasts suggest some stability, and Cornwall Insight expects the cap to remain relatively steady throughout 2026, with only a small rise pencilled in for July.

But experts warn that keeping bills down long-term won’t be straightforward, as Britain needs significant investment in energy networks and infrastructure to improve security and reduce reliance on imported gas. That investment ultimately has to be funded.

In the short term April’s expected drop will provide breathing space for many households. After years of sharp rises and volatility, even a modest reduction will be welcome, particularly as wider cost-of-living pressures persist.