Ofgem cuts price cap, winter bills expected to rise

Ofgem has announced a 7% reduction in the energy price cap but forecasts indicate bills will rise again this winter.

Ofgem has announced the energy price cap for the third quarter of 2024, setting it at £1,568 annually for a typical dual fuel consumer.

This represents a 7% decrease from April’s cap of £1,690.

The new cap reflects the impact of lower gas and electricity prices earlier in the year, despite a recent rebound in wholesale prices.

The July cap marks the second consecutive quarter of falling energy bills and a significant drop from the figures for the same period in 2023.

This decline has contributed to reducing the UK’s annual inflation rate to a near three-year low of 2.3%.

However, Cornwall Insight forecasts suggest that the decrease may be temporary.

With an uptick in the wholesale market, energy bills are expected to rise again before winter.

Predictions indicate that a typical consumer bill will increase to £1,762 from October and remain around this level into January 2025.