![A home smart meter showing energy use](https://media.guim.co.uk/608b9b417f0b1d827b8d2364e81760749e97c15e/0_0_2843_1705/1000.jpg)
Household energy bills could fall to an average of £2,053 a year this summer as the regulator prepares to lower its cap on energy prices next week, according to analysts.
However, campaigners have warned that the lower cap on energy bills, to be announced on Thursday, is unlikely to provide much relief to households that struggled to pay their bills over the winter because the government’s support schemes have come to an end.
Households should also expect their energy bills to remain stubbornly high through the coming winter, at almost double the rates paid in 2020, and remain above pre-pandemic levels for the rest of the decade, according to analysts at Cornwall Insight.
The government’s energy price guarantee capped gas and electricity bills at an average of £2,500 for a typical household from October last year. Energy bill payers also received a £400 rebate spread over six months from October, which helped reduce costs further.
From July this year the standard energy tariffs used by 27 million households will once again be decided by a cap calculated by Ofgem, the energy regulator for Great Britain, which is based on the cost of supplying energy.
Cornwall Insight has predicted that Ofgem’s cap 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 £2,053 from July to reflect the tumbling cost of gas in the global wholesale markets.
The price cap is expected to remain at similar levels next winter, too, according to Cornwall’s analysts. They have predicted that the cap will dip slightly to £1,975 for the three months from October before rising again to reach almost £2,045 for the first quarter of next year.
“Despite the cap falling from the sky-high prices of the past two years, the figure remains over £1,000 per year more than the price cap levels seen prior to the pandemic,” Cornwall Insight said. “We do not currently expect bills to return to pre-2020 levels before the end of the decade at the earliest.”
Campaigners from the End Fuel Poverty Coalition have warned that households hoping for a sharp drop in their bills may find little difference compared with the rates they paid over winter.
Simon Francis, a coordinator at the coalition, said: “People now face many more months with bills remaining stubbornly high. This will see them continue to use up their savings for everyday items, run up credit card bills, fall into debt with energy firms or turn to food banks as the cost of living crisis deepens.”