**Good News for Households: Energy Bills Set to Drop!**

Domestic energy prices in the UK are expected to see a significant decrease starting in July, marking the first drop in regulator Ofgem’s price cap in a year. According to the consultancy Cornwall Insight, households that use a typical amount of gas and electricity will see their annual bills decline by £129, an approximate 7% drop. This reduction will bring the average dual-fuel bill for customers paying by direct debit down to £1,720, down from the current £1,849.

The energy price cap, which impacts about 22 million households across England, Wales, and Scotland, is revised every three months by Ofgem. It is calculated based on a ‘typical household’ consuming 11,500 kWh of gas and 2,700 kWh of electricity annually.

Dr. Craig Lowrey, a principal consultant at Cornwall Insight, described the drop in the price cap as a “welcome development” that provides households with much-needed breathing space amid a persistent stretch of high energy costs. However, he cautioned that prices are still far from ideal for many families grappling with the cost of living, as current bills remain significantly above levels seen at the beginning of the decade.

Cornwall Insight had previously anticipated a more substantial reduction, previously estimating a cap drop to £1,683. The latest forecast reflects increased wholesale energy prices that have influenced potential savings. Looking ahead, Cornwall Insight predicts that the energy price cap will drop further in October and again in January 2026, offering a glimmer of hope for struggling households.