Energy price cap calculator: How much will your bills fall?

The energy price cap has been lowered and MailOnline’s new online calculator today shows how much your energy bill should decrease on July 1.

Ofgem confirmed today that its price cap for the average household’s annual energy bill will fall to £2,074 – down from the current level of £3,280.

Crucially, this brings the energy price cap below the £2,500 energy price guarantee and means the average UK household saves around £426 on gas and electricity.

The price cap is set for the average household and the individual costs depend on the household’s energy consumption – with our calculator you can calculate what this means for your bills.

Use MailOnline and This is Money’s utility bill widget – which we built with financial management system Nous – to find out how the reduction in the price cap will affect you.

Enter some brief details about how your home is powered, whether you have a prepayment meter and your current monthly payments to find out how much cheaper your bill will be.

Energy prices have risen to record levels over the past 18 months as the disruption from the aftermath of the Covid lockdowns combined with the Russian invasion of Ukraine has sent energy costs skyrocketing.

The war in Ukraine has seen wholesale gas prices rise around the world, with Ofgem’s price cap skyrocketing from £1,162 a year in August 2021 to a peak of £4,279 in January this year.

Since October 2022, customers are partially protected by the government’s energy price guarantee, which limits annual energy costs to £2,500.

All households in England, Scotland and Wales also received £400 from the government to offset rising prices over the winter.

Cornwall Insight has predicted Ofgem’s limit will fall by more than £1,000 from £3,280 for the three months from April – when households were still protected by the government scheme – to £2,074 from July to reflect the falling cost of gas in global wholesale markets display .

The price cap has skyrocketed from £1,162 a year for a typical household in August 2021 to its current level of £3,280, after briefly reaching £4,279, with the pandemic and the Russian war in Ukraine both driving up wholesale prices.

This will change in July if Ofgem lowers the price cap to a level below that. There is hope that falling energy prices will also lead to a return to the ability to switch energy suppliers and a competitive market with fixed rates.

Despite the fall in the price cap, activists have warned that households will not be fully relieved for another seven years – with utility bills set to remain high until at least 2030.

“We do not currently expect bills to return to pre-2020 levels until the end of the decade at the earliest,” said Cornwall Insight.

The fuel poverty charity National Energy Action (NEA) added that bills will remain ‘prohibitive’ for many due to the government’s decision to cut its winter support packages.

> Energy ceiling guide: when will your bills fall and by how much?

It’s vital to remember that Ofgem’s price cap does not set a maximum amount on how much a household will pay towards their overall utility bill.

The price cap instead limits the amounts of money providers are allowed to charge their customers per unit of gas or electricity, meaning those who use more energy pay more.

> How to save money on energy and how your bills work

Greg Marsh, CEO and founder and co-founder of household money-saving tool Nous.co, said: ‘Most households will see their energy bills fall from July, but unfortunately this is not the end of the painful pressure on incomes.

“Bills will be nearly double their pre-energy crisis levels, and other prices, such as groceries, will continue to rise.

‘Energy Minister Grant Shapps and regulator Ofgem must do much more to encourage energy suppliers to pass on falling wholesale prices to consumers.

“We must not forget that millions of people are seriously struggling to pay their bills.”

Ofgem is expected to drop its energy price cap from £2,500 to £2,074 in July, experts have said

The government’s £400 winter rebate, paid to each household in six installments, ended in March.

Now only those receiving means tested benefits, pensioners and people with disabilities will receive further help with their utility bills, which are £900, £300 and £150 respectively.

The flat fee – the roughly £300 that households pay each year to access gas and electricity – is also controversial.

The fuel poverty charity National Energy Action (NEA) warned that while a reduction in the price cap “seems like good news”, July bills would be similar to last winter’s due to the end of government support.

NEA chief executive Adam Scorer said: ‘Now that winter is out, most people will welcome a reprieve from record high prices, but it still leaves prices more than 80 percent higher than the start of the energy crisis and two million more households. stuck in fuel. poverty.

“More than two and a half million vulnerable low-income households are no longer receiving government support for unpayable bills. For them, the energy crisis is far from over.’