Households told energy prices will be lower this summer than originally feared

Finally some good news! Energy prices are expected to fall this summer

smart meter on table with pot plant
(Image credit: Future PLC / Lizzie Orme)

Households have been told that energy bills will be £600 less than feared this summer due to falling wholesale gas prices. 

In the Autumn Budget, the Government forecasted that the average household energy bill would rise to £3,000 when the Energy Price Guarantee is increased. However, The Resolution Foundation has revised this figure saying that the average household will pay £2,400 in 2023-24. 

The Think Tanks report has been backed up by energy consultancy Cornwall Insights, which predicts that the average energy bill will be £2,360 over the summer. According to The Times Cornwall said it expected gas prices to fall by 26 per cent between spring and summer, and electricity prices to fall by 32 per cent. 

Grey chair in grey room with white radiator

(Image credit: Future PLC)

However,  while energy bills are going to be lower than anticipated, The Resolution Foundation clarified that they will still be £400 higher than they have been this year. Many households will still feel the pressure of an increase in energy bills in April as the government Energy Price Guarantee is raised from £2,500 to £3,000.

'Falling wholesale gas prices have been the big economic good news story of the year so far. This will bring real benefits to families, even if it might not feel like it for some time to come,' says Emily Fry, Economist at the Resolution Foundation.

'While energy bills are still set to rise next year by another £400, we’re not on course to see the sustained £3,000 annual bills many feared.'

smart meter on table with pot plant

(Image credit: Smart Energy GB)

'The cost of living crisis is far from over, but falling gas prices mean that it’s looking less bleak than just a few months ago,' she adds. So now isn't the time to forget all the advice on how to save on energy bills.

The reason behind the new average energy price prediction is the drop in wholesale gas prices. In 2023-24 these are now down by 70 per cent from the peak in August, due to a mild winter and European countries cutting their dependencies on Russia. 

However, the energy markets over the past year have been very volatile so the outlook in the long term is still uncertain. While the pressure is still going to be tough on household finances, it should hopefully be less than we originally feared.

Rebecca Knight
Deputy Editor, Digital

Rebecca Knight has been the Deputy Editor on the Ideal Home Website since 2022. She graduated with a Masters degree in magazine journalism from City, University of London in 2018, before starting her journalism career as a staff writer on women's weekly magazines. She fell into the world of homes and interiors after joining the Ideal Home website team in 2019 as a Digital Writer. In 2020 she moved into position of Homes News Editor working across Homes & Gardens, LivingEtc, Real Homes, Gardeningetc and Ideal Home covering everything from the latest viral cleaning hack to the next big interior trend.