Energy Bills Set for £117 Reduction from April 1
Millions of UK households are set to receive a welcome financial boost as the energy price cap is forecast to fall by £117 from April 1, 2026. According to the final prediction from Cornwall Insight, the cap will drop to £1,641 per year for a typical dual fuel household, representing a 7% decrease from the current level of £1,758.
Forecast Details and Market Analysis
Cornwall Insight released its definitive forecast for the April to June 2026 price cap following the closure of the observation window on February 17. The consultancy firm highlighted that this reduction is primarily driven by lower policy costs resulting from government interventions, with minimal impact from recent fluctuations in wholesale energy prices.
Dr Craig Lowrey, Principal Consultant at Cornwall Insight, commented on the positive development, stating: “Any reduction in bills is positive, easing pressure at a time when affordability really matters. It’s the drop in policy costs, as a result of Government interventions, that is doing most of the heavy lifting.”
Long-Term Challenges and Energy Security
While the immediate decrease offers relief, Dr Lowrey emphasised the ongoing challenges in sustaining these savings. He noted: “The real test will be keeping those savings going. That won’t be easy as the UK continues to upgrade its networks and infrastructure.” This investment is crucial for building a more secure and resilient energy system, particularly after recent exposure to volatile global markets.
Dr Lowrey also stressed the importance of transparency in communicating the costs associated with the energy transition. “However, there needs to be an open conversation about the fact that such a transition will not be cost‑free. The most important thing is transparency - being honest with people about why these changes are happening and how they fit into a longer-term plan.”
He added that while significant overnight drops are unlikely, long-term progress toward price stability and energy security is achievable through a sustained shift to homegrown energy sources.
Technical Basis and Consumption Values
The forecast is based on the monitoring period used by Ofgem to calculate the wholesale component of the price cap. Ofgem’s Typical Domestic Consumption Values (TDCVs) are set at 2,700 kWh per annum for electricity and 11,500 kWh per annum for gas, providing a standardised measure for household energy use.
This reduction comes as a timely relief for consumers grappling with high living costs, though experts caution that continued investment in infrastructure and transparent policy discussions will be key to ensuring long-term affordability and energy independence for the UK.
