Millions of the country’s most hard-up families will have their energy bills slashed by £85 a year following a slump in demand.
After lockdown led to the lights going out at businesses across the UK, one leading supplier is predicting a 7.5% cut in standard variable tariffs.
According to E.ON, a fall in demand from the commercial sector will be reflected in lower rates when the regulator Ofgem reveals its new price cap on Friday.
Around 11 million households are on a default SVT, which has led to families paying over the odds for
gas and electricity, compared with those on fixed-rate deals.
Last year, Ofgem brought in a price cap to protect the most vulnerable from being overcharged. According to
E.ON, bills will come down by the equivalent of a month’s energy use for an average home – said to be £85.
E.ON boss Michael Lewis said: “Whilst wholesale prices have continued to fluctuate, we saw significant falls since the start of the year driven by Covid-19 and the subsequent lockdown. We expect a significantly lower level when Ofgem updates the price cap.
“Customers should see the benefit of lower bills in time for the colder months.”
Richard Neudegg, of uSwitch said: “For around half of households on supplier default, or standard tariffs, the change in the cap will represent a fall in prices from October.”
Harry Rose, from Which?, added: “Customers looking to save on their energy bills now should shop around and switch energy providers – you could save around £300 a year…”
