Britain’s energy regulator has slashed the price cap on national energy bills by £1,206 following a slump in wholesale gas and electricity prices.
The price cap will drop to £2,074 a year from July for typical households, from £3,280 in the past three months.
The cap governs the maximum energy providers can charge customers on default tariffs, although since October the government has been paying part of the household bill.
The drop in the level of the cap means that government support will now disappear, while typical households will pay around £426 a year less.
However, bills below the cap will still be around 60% higher than before the spike in energy prices that began in late 2021 – on the eve of Russia’s invasion of Ukraine – which contributed to drive up the inflation rate in the UK and trigger the cost of living crisis.