UK households are set to enjoy a welcome respite from rising energy bills, as wholesale prices are expected to drop by 9% in July, bringing a temporary reprieve from the cost of living crisis.
Average Energy Bill in Britain Set to Fall 9% in July
Wholesale energy prices have fallen amid warm weather and global economic uncertainty caused by Donald Trump‘s tariffs. This decrease is expected to bring relief to households, with the typical dual fuel energy bill forecasted to drop by £166 over the year.
Factors Contributing to the Decrease in Wholesale Energy Prices
The fall in wholesale gas prices has been driven by US trade tariffs and the impact of above average temperatures, which has reduced demand expectations and taken some pressure off prices in the short term. This reduction in demand has led to a decrease in energy prices, providing households with a temporary reprieve from rising costs.
Expected Changes to the Energy Price Cap
According to Cornwall Insight, the price cap on household energy bills will fall to the equivalent of £1,683 a year for the typical household, down from the £1,849 a year level set in April. This decrease is expected to take effect from July until the end of September and will reflect the average annual dual-fuel bill for about 29m households.
Analysts’ Predictions
Analysts at Cornwall Insight expect there to be a ‘very slight fall’ in the price cap in October, followed by another decline in January 2026. However, Dr Craig Lowery, of the consultancy, warned that bills could still rise again due to market volatility and geopolitical shifts.
‘The only real way to protect households from this constant cycle of instability and insecurity is to reduce our dependence on international wholesale markets,’ Dr Lowery said. ‘That means continuing to focus on growing low-carbon energy generation here in Great Britain and building a more secure, more sustainable energy future.
Low-carbon energy generation refers to the production of electricity without emitting significant amounts of greenhouse gases, primarily carbon dioxide.
This can be achieved through various renewable energy sources such as solar, wind, hydroelectric, and geothermal power.
According to the International Energy Agency (IEA), renewable energy accounted for 26% of global electricity generation in 2020.
Solar energy is the fastest-growing source of low-carbon energy, with solar photovoltaic capacity increasing by over 50% annually since 2015.
Cornwall Insight is a UK-based energy market research and consulting firm.
Founded in 2002, the company provides data-driven insights to the energy sector.
Its primary focus areas include energy policy, regulation, and market analysis.
Cornwall Insight's expertise spans across various sectors, including electricity, gas, and heat markets.
The company's research and reports are widely recognized for their accuracy and depth, making them a valuable resource for industry professionals.
Donald Trump is a businessman, television personality, and politician who served as the 45th President of the United States from 2017 to 2021.
Born on June 14, 1946, in Queens, New York, Trump graduated from the University of Pennsylvania with a degree in economics.
He took over his family's real estate business and expanded it into a global brand.
Trump has written several bestselling books, including 'The Art of the Deal.' He hosted the reality TV show 'The Apprentice' from 2004 to 2015.
