Average household energy bills set to fall by £300 a year from April

Household energy bills are set fall by 16% from April, analysts have predicted, after a drop in wholesale gas prices. Cornwall Insight has forecast that average bills will drop by more than £300 a year.

The forecaster predicts that Ofgem’s price cap, representing the average annual bill for a typical household in Great Britain, will fall from the current £1,928 to £1,620 from April – £40 lower than it predicted in December. Energy bills could reach their lowest since Russia’s invasion of Ukraine.

Furthermore, it has predicted that prices will remain lower than the current cap throughout 2024, falling to £1,497 a year in July before rising slightly to £1,541 in October. It said tensions in the Red Sea had failed to derail the prospect of lower energy bills and European gas stocks remained at higher-than-expected levels for the time of year, reflecting the relatively mild winter.

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This, combined with “fairly healthy supply conditions”, had seen wholesale prices fall since November. However it warned that despite the recent wholesale price drop, UK energy prices remained vulnerable to global events, and any potential disruption to supplies would “weigh on market confidence, and we will need to keep a close eye on market fluctuations over the next few months”.

Additionally, ongoing consultations by Ofgem on potential changes to the price cap, including the standing charge and bad debt collection, could affect the overall figure.

Craig Lowrey, principal consultant at Cornwall Insight, said: “Concerns that events in the Red Sea would lead to a spike in energy bills have so far proved premature, and households can breathe a sigh of relief that prices are