Energy price cap falls to lowest point in two years

Ofgem has announced that the energy price cap, which limits energy costs for the average UK household, will drop from £1,928 to £1,690 from April 1, the lowest level it has been since the winter of 2021 and 2022. The £238 drop equates to a 12.3% decrease. Ample supplies of liquefied natural gas to Europe and reduced demand in a relatively mild winter have led to a drop in wholesale natural gas prices, which is what Ofgem bases its price cap on. Fears over shipping disruption in the Red Sea have also failed to put upward pressure on wholesale gas prices. The regulator also announced that households with prepayment meters would no longer pay a higher standing charge than those paying by direct debit or credit. Ofgem’s chief executive, Jonathan Brearley, said that the organisation still needed to confront some considerable issues:

“…to ensure we build a system that’s more resilient for the long term and fairer to customers. That’s why we are ‘levelising’ standing charges to end the inequity of people with prepayment meters, many of whom are vulnerable and struggling, being charged more upfront for their energy than other customers.”

Industry researcher Cornwall Insight is currently predicting the cap will fall further to £1,462 in July, followed by a rise to £1,521 in October. Nevertheless, with gas prices set to remain well above pre-crisis levels, it can make financial sense to upgrade to a modern boiler. Get it touch with Xgas to arrange a boiler installation in Oswestry and other locations around the Wrexham area.