Ofgem have set the default price cap at £1,042 now, which is the lowest seen since the introduction of the cap in early 2019. The reduction is due to the decrease in wholesale gas prices which have hit a 20 year low.
As a result, the cut will provide in huge savings for nearly 11 million people on default tariffs and 4 million people on prepayment meters.
Jonathan Brearley, Chief Executive of Ofgem, commented on the cap;
“Millions of households, many of whom face financial hardship due to the Covid-19 crisis, will see big savings on their energy bills this winter when the level of the cap is reduced”
In addition to this, Director of Regulatory Affairs at the Energy Ombudsman, Ed Dodman, added;
“This reduction in the price cap represents a much-needed financial boost for millions of households, at a time when many people are struggling due to the economic impact of Covid-19 and lockdown. Shopping around for a cheaper energy deal is still the best way to save money, particularly for customers on standard variable tariffs, but before switching to a new supplier it’s a good idea to check out its customer service credentials.”
If you would like to read more on this or would like some advice on saving money with you domestic energy bills, follow this link to BBC News