We should all see our costs slashed as the energy price cap falls by 12 per cent in April

We’re all set to pay a bit less for our bills from April as the energy price cap comes down.

An average household using both gas and electricity and paying by Direct Debit will pay around £1,690 a year.

For prepayment customers, it’ll be slightly cheaper at £1,643 a year.

That’s a fall of around £250, or more than 12 per cent, on the rate we’ve been paying since the start of the year.

It’s important to remember though that the price cap isn’t a cap on our bills. It limits the amount we can be charged per unit of energy. So the more we use, the more we’ll pay.

The energy price cap applies to customers on default tariffs (that is, those who haven’t fixed with their supplier). If we’re on a fix, the change won’t affect us, unless our fix ends and we move on to the default tariff.

It is amended every three months, depending on the wholesale costs that energy suppliers have to pay.

This is the lowest energy price cap since the start of the war in Ukraine in early 2022.

And the good news is that it’s predicted to go down again in summer (maybe by up to 13 per cent) before rising slightly again in autumn.

Under the new price cap, energy costs will be very slightly lower for prepayment meter customers.

Record numbers of customers are now in energy debt, the regulator Ofgem said. Quids in! has advice on help and support available if we’re affected.

The costs are way down on the peak over last winter, when the price cap soared to more than £4,000 a year.

The government’s energy price guarantee meant we didn’t pay this much though – costs were capped at £2,500.

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