Ofgem confirms energy cap is set to drop this winter

Energy regulator Ofgem has confirmed that energy caps will fall this winter due to lower wholesale costs.

Around 11 million default tariff gas and electric customers are protected by the price cap, which is expected to fall by £75 to £1,179 from October 1.

The wholesale energy cost element of the default tariff cap fell by £75 to £446 while other costs, such as VAT and supplier profits, took a slight dip.

Dermot Nolan, chief executive of Ofgem, commented: “The price caps require suppliers to pass on any savings to customers when their cost to supply electricity and gas falls.

“This means the energy bills of around 15 million customers on default deals or pre-payment meters will fall this winter to reflect the reduction in cost of the wholesale energy.

“These customers can be confident that whatever happens, the price they pay for their energy reflects the costs of supplying it.”