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Ofgem announces new energy price cap which will see household bills drop nearly £430 a year from July

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Ofgem is lowering its energy price cap from the current £3,280 per year to £2,074 for the average household in Scotland, England and Wales from July to reflect tumbling wholesale price.

The regulator announced its latest energy price cap on Thursday as campaigners warned consumers are likely to feel little relief with bills remaining well above pre-pandemic levels.Consultancy firm Cornwall Insight said despite the drop, households should also expect their energy bills to remain stubbornly high through the coming winter, at almost double the rates paid in 2020, and remain above pre-pandemic levels for the rest of the decade.

The UK Government's temporary Energy Price Guarantee (EPG) has capped gas and electricity bills at an average of £2,500 for a typical household since October, lower than Ofgem's price cap.All households in Scotland, England and Wales also received the £400 Energy Bills Support Scheme discount (£66/£67 per month) from the UK Government to offset soaring prices over winter 2022/23.However, Ofgem's cap is now below the EPG - which will rise to £3,000 from July - meaning it will once again determine the amount firms can charge customers for their energy from July 1.The price cap has rocketed from £1,162 a year for a typical household in August 2021 to its current level of £3,280, having briefly reached £4,279, with the pandemic and Russia's war in Ukraine both pushing up wholesale prices.The cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will pay more.The standing charge has not charges and will still cost households around £300 a year just to be connected to their gas and

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