Autumn Budget 2025: Energy bills to fall £150 from April 2026

Xbigman

As a low user I wasn't too impressed that my £150 saving was going to be only about £60 but I read the Nesta report linked to above and the biggest beneficiaries are households with electric central heating. As that is a major cause of poverty I think it just might be the right call to not change the standing charge after all. 

The Nesta report also points out the governments calculation for average is different to OFGEMs and using the OFGEM method the average saving is only £133. 

Finally the government is supposedly going to ensure that the saving will apply to fixes. This is a two edged sword. Future governments could make policy changes that push fixes up and force that through too. A fix should be just that, fixed. 


Darren

wakeupalarm

So according to the figures on MSE news story, Rishi Sunak and his swimming pool will get considerably more than £150, whilst a low user will get considerably less than £150.
Were these policy costs not added to standing charges?  So why are they coming off unit rates?

This change will make standing charges even more of a dominant portion of low users bills.

CadriC

So, does anyone know if the energy companies HAVE TO reduce their tariffs on fixed rates from April?  After Martin's TV programme this week I found and signed up to a fixed tarriff. Will I still get the levy reduction or was I "sold a dud"?

EssexHebridean

I don't think that level of detail is known yet.

Ageingdinosaur

I think I will stick to my capped rate at present, at least until further details are available. I am paying £10 per month less on my current capped tariff than I would be if I changed to the cheapest fixed tariff.

EssexHebridean

Ageingdinosaur said:

I think I will stick to my capped rate at present, at least until further details are available. I am paying £10 per month less on my current capped tariff than I would be if I changed to the cheapest fixed tariff.

That seems fairly unlikely, but as long as you have checked the unit rates and standing charges to be certain. 

As an example, I have just changed to a fix for my Gas which means I'm paying 5.06p/kWh. The capped standard variable tariff would see me paying 6.22p/kWh. The Standing charges are identical.  At this time of year that will make a substantial difference over a month! 

spot1034

Xbigman said:

As a low user I wasn't too impressed that my £150 saving was going to be only about £60 but I read the Nesta report linked to above and the biggest beneficiaries are households with electric central heating. As that is a major cause of poverty I think it just might be the right call to not change the standing charge after all. 

The Nesta report also points out the governments calculation for average is different to OFGEMs and using the OFGEM method the average saving is only £133. 

Finally the government is supposedly going to ensure that the saving will apply to fixes. This is a two edged sword. Future governments could make policy changes that push fixes up and force that through too. A fix should be just that, fixed. 


Darren

Perhaps the answer would be to waive any exit fee if the customer wishes to transfer to a new fix, and make sure the option is communicated clearly via whatever means the customer is usually contacted. Of-course those with suppliers who do not charge for internal transfers are already in this position.

Qyburn

All these comments about people being entitled to move off fixed deals, or suppliers being forced to reduce fixes if they end up higher than SVT, will just mean suppliers are less likely to offer fixes in the first place.

t0rt0ise

m_c_s said:

t0rt0ise said:

m_c_s said:

Looney economics. Save £150 on energy but pay it back, plus some more, in higher taxes. Just a transfer to general taxation.

It should be paid from general taxation the same as the warm homes thing and other heating help given to those on benefits. They shouldn't be put on energy bills but paid through taxation. It's fairer that way.

That is not what's being reported and indeed Martin's link clearly says "Together, the Government says these measures will save a typical dual-fuel household around £150 a year on average from 1 April 2026.". 
This is misleading. A typical household may save £150 on energy but will most likely pay it back in other taxes. That was the point I was making.

I said it's what should happen, not what will happen.

Scot_39

Ildhund said:

There's what appears to be a sober review of what this all means here: What does the Budget mean for energy bills? | Nesta

I wonder how many households really use nearly 6000 kWh with a heat pump - at a cop of 3 - on average - thats 18000 kWh - 50% more than the median TDCV for gas.

7100 kWh for a home with storage heating might not be unrealistic - but it certainly wont be poor households consuming at that sort of level.  Even at say 20p ave on a decent E7 and high off peak ratio - thats £1600pa

I used to use around the old median TDCV - just over 4000 kWh - before crisis - but to control bills - Ive dropped the temperatures 2 degrees in living room - and 3-4 degrees in the rest of the house.  And now use half that NESTA number - in a typical winter - a little less in a mild one (3300kWh last year).   But do spend more on thermals to live with those lower temps.  To go lower I'd need gloves and hats etc - I tried - and a step too far - for now

In reality I suspect many will be lucky to come out level - come this April - compared with last quarter - after WHD and net zero policy has increased electric cap by 7.5% in 3 months - with more predicted for net zero o a continuous basis between now and 2030 forecasts - as things like network investment continues apace (£10bn+pa), and balancing and curtailment ramp up to the £8bn pa forecast.