Energy bills to fall in April, what it means for your family budget
Ofgem confirms a 7% drop in the energy price cap from April, but savings will vary for families.
Energy bills are finally set to fall this April, offering a little breathing space for family budgets that have been stretched for years.
Ofgem has confirmed that the energy price cap will drop by 7% from April, meaning a typical household on a variable tariff will pay £117 less a year. But while the headline sounds positive, the reality for many families is a bit more nuanced.
Here’s what the changes mean for your home and how much you could actually save.
How much will energy bills fall?
From 1 April, the annual energy bill for a typical dual fuel household paying by direct debit will fall to £1,641, down £117 from current levels .
For families paying monthly, that works out at roughly £10 less per month for households using a typical amount of gas and electricity .
The 7% drop is the biggest fall since last summer , and applies to households covered by Ofgem’s price cap, which includes most people on standard variable tariffs.
However, bills are still about a third higher than they were before the war in Ukraine , so this is far from a return to pre cost of living crisis prices.
Why are bills going down?
Energy bills are made up of several parts, including the cost of buying gas and electricity, network costs, supplier costs and government policy charges.
In the Autumn Budget, the government announced changes to policy costs, including scrapping the Energy Company Obligation scheme and moving some charges onto general taxation. At the time, it said this would reduce a typical annual bill by £150.
But rising network costs, which cover maintaining and strengthening power lines, cables and gas pipes, have offset some of that saving. These costs are increasing by about £6 a month for a typical household .
As a result, the actual reduction from April is £117 rather than the full £150 originally suggested .
How much will your household pay?
What you actually pay depends on how much energy your family uses.
Based on Ofgem’s figures for April to June 2026:
Low usage home
- Approx annual cost: £1,190
- Typical of a flat or one bedroom house
- Around 1 to 2 people
Medium usage home
- Approx annual cost: £1,641
- Two to three bedroom house
- Around 2 to 3 people
High usage home
- Approx annual cost: £2,302
- Four or more bedrooms
- Around 4 to 5 people
These figures are illustrative and based on households paying by direct debit under the price cap.
The reduction will mainly come through a lower price per unit of electricity . That means families who use more electricity, for example those running medical equipment at home, are likely to see a bigger benefit. Households that use relatively more gas than electricity may see smaller savings .
What about families on fixed deals?
If you are on a fixed tariff, you will still see a reduction because of the changes to policy costs. Suppliers are expected to contact customers in the coming weeks with details of how their specific tariff will change .
Ofgem’s director general of markets, Tim Jarvis, described the announcement as “welcome news for many households” .
He added: “We're also seeing encouraging signs of greater engagement and competition, with switching increasing by almost 20% year on year” .
Will bills fall further this year?
The wholesale price of gas remains volatile and difficult to predict . Energy consultancy Cornwall Insight is forecasting relatively little further change later in the year.
Dr Craig Lowrey, its principal consultant, said: “This reduction in the cap will bring real relief to households after a prolonged period of pressure on their energy bills. However, our early view for July suggests that this is where the big falls stop” .
In other words, this may be the main drop families see in 2026.
The bigger household budget picture
While lower energy bills will be welcome, other household costs are rising. Water bills are increasing in many areas, council tax is set to go up, and many families are still managing higher food and childcare costs .
Collective debt to energy suppliers has climbed to well over £4bn , highlighting just how tough the past few years have been.
If you are struggling, suppliers may be able to help. Dhara Vyas, chief executive of Energy UK, said: “They are giving them different tariffs, extra help and support, offer white goods such as efficient fridges, but they can only do this if they know who is in your household and what your circumstances are” .
For families juggling nursery fees, packed lunches and everything in between, April’s drop will not solve the cost of living squeeze. But it may at least make the monthly direct debit feel a little less daunting.