Average household energy bills to fall by 7% from April
By Abigail Townsend
Date: Wednesday 25 Feb 2026
(Sharecast News) - Typical household energy bills are set to fall by £117 from April, the regulator confirmed on Wednesday, following changes introduced by government.
Ofgem said the price cap would be cut by 6.6% to £1,641 for the average combined gas and electricity bill for the three months from April. The price cap dictates the maximum amount suppliers can charge users for each unit of gas and electricity, including the standing charge. It is the biggest drop since last summer.
The cap has been reduced after the Treasury confirmed last year that funding for two environment and social schemes will no longer be funded by billpayers. Ofgem said that change would save customers an average of £150.
Global wholesale energy prices have also eased over the last three months.
However, those savings have been partially offset by higher network costs, primarily due to investment in upgrading energy infrastructure. Network costs rose by £66 a year, Ofgem said.
Tim Jarvis, Ofgem's director general for markets, confirmed the price cap reduction had been driven by government actions.
He called it "welcome news for many households", adding: "We're also seeing encouraging signs of greater engagement and competition, with switching increasing by almost 20% year on year."
Ofgem defines a typical household as one that uses 11,500 kWh of gas and 2,700 kWh of electricity a year, and pays one bill for both via Direct Debit. Households who use more energy, or pay by cheque, will pay more.
Ofgem reviews the price cap every three months, and will publish its next decision for the third quarter at the end of May.
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