The Chancellor has today announced that millions of households will get further support with high energy bills to help with the cost of living through the extension of the Energy Price Guarantee.
In last year’s Autumn Statement, the Chancellor originally announced that the Energy Price Guarantee (EPG), which is protecting households by capping typical energy bills at £2,500, was due to rise to £3,000 on April 1, with the Government then expecting to borrow £12 billion to fund this support.
Since then, energy prices have fallen by 50%, cutting the borrowing needed to fund energy support by two- thirds to £4 billion. The EPG will now therefore be maintained at the same level for a further three months over April, May, and June, worth £160 in total for a typical household.
The Chancellor’s three-month extension of the Energy Price Guarantee means households won’t feel the full force of Ofgem’s Price Cap between April and June – which stands at £3,280 – helping to bridge consumers into the summer when the need to use energy to heat homes will be lower.
Government support has already cut the typical family energy bill by over £1,300 since October, stopping the average household energy bill hitting £4,279 a year this winter.
Furthermore, lower wholesale gas prices are expected to feed through to lower household energy bills from July, where Cornwall Insight data suggests the Ofgem Price Cap will decrease to an estimated £2,100 a year for a typical household.
The Government remains committed to protecting consumers from the worst impacts of energy price inflation, and will continue to roll out additional support to protect the most vulnerable in our communities.