Energy price cap: online calculator predicts how your bills will change in July 2024 as new price cap drops
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- Ofgem’s reduced energy price cap means a 7% decrease in average household energy bills from 1 July
- The new price cap saves about £122 annually for typical dual fuel households
- A new online calculator by Nous helps households estimate their energy bill savings after the price cap drop
- Household energy usage, size and habits can influence individual savings after the general decrease in prices
- Households on standard variable tariffs without smart meters should submit meter readings to avoid overpaying
Millions of British households are being asked to send their energy meter readings to their suppliers as prices drop.
Starting Monday (1 July), the average household energy bill has decreased by 7% after Ofgem lowered its price cap due to changes in wholesale prices.
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Hide AdThe regulator reduced the cap from £1,690 to £1,568 for a typical dual fuel household in England, Scotland and Wales - a fall of £122 over the course of a year. This new cap is about £500 less than it was in July last year when it was £2,074.
The average household is expected to spend £83 on energy in July, compared to £127 in June, due to the lower cap and warmer weather reducing usage, according to comparison site Uswitch.
But exactly how much of a difference will the drop in prices make for your household? Here is everything you need to know about it.
How much will my household save?
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While the average household is expected to spend £83 on energy in July - compared to £127 in June - in actuality, individual households will experience different levels of savings due to several factors.
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Hide AdOf course, the amount of energy a household uses will significantly affect costs, with higher usage leading to higher bills, even with the lower price cap. Thankfully, with it being July, usage should naturally be down at this time of year (so long as the British weather plays ball).
Larger households typically use more energy for heating, cooling, lighting, and appliances, and individual habits, such as leaving lights on, long showers, or the use of multiple electronic devices, influence energy consumption.
Is there an online calculator?
Each household's specific situation and habits will determine how much they benefit from the reduced price cap.
But a new online calculator from Nous shows how much your gas and electricity bills will decrease following the price cap drop.
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Hide AdThe calculator takes around 30 seconds to use, and just by answering a few simple questions - like how much you currently spend on energy - can give you an accurate prediction of your post-price cap drop savings.
To use the calculator, visit the Nous website here.
Money-saving champion and Nous founder Greg Marsh said: “While falling energy bills will offer some comfort to households facing cost-of-living pressures, this relief will be short-lived.
“The price cap, which remains significantly higher than it was two years ago, is expected to rise again in October, staying high through the early months of 2025.
“Affordable fixed energy deals have largely vanished, leaving us stuck on expensive rates. As a result, a record number of households now owe money to their energy supplier, with the average debt exceeding £1,000.
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Hide Ad“Fortunately most people can still save if they know where to look. At Nous we can typically save a household around £150 on their energy without having to commit to a fixed deal.”
Should I submit a meter reading?
Households on a standard variable tariff – as opposed to a fixed deal – and who do not have a smart meter should submit their electricity and gas readings to their supplier as close as possible to 1 July to ensure they are billed accurately at the lower prices.
Submitting a meter reading is a good idea because it ensures that your energy bill reflects your actual usage rather than an estimate, which can help you avoid being overcharged, especially when new price caps or rates come into effect.
Those who do not submit readings risk having some of their usage after this date charged at the previous, more expensive rates. Households without smart meters or pay-as-you-go meters, of which there are approximately 29 million in the UK, should provide readings.
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Hide AdThose with smart meters don't need to submit readings as these are automatically sent to suppliers, but it is advisable to check that the meter is working correctly. Taking a photo of the meter reading on 1 July can also help to resolve any disputes if they arise at a later date.
Prepaid meter users also don’t need to submit readings, but energy paid for after 1 July will be cheaper, which might influence when you choose to top up - if you're running low, you might save money by waiting until after 1 July to top up.
More information on submitting a meter reading - including who should do it, why it’s a good idea, and how to do it - can be found in this guide.
We want to hear from you! How do you plan to maximise your savings with the new energy price drop? How will the changes impact your household, and do you have any tips for managing energy costs effectively? Share your thoughts, questions and experiences in the comments section.
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