The future direction of prices is hard to predict. While little change had been expected for prices this autumn, uncertainty in the Middle East could still have an impact on wholesale prices, with a knock-on impact on household bills.
Analysts at the energy consultancy Cornwall Insight have forecast a further 1% drop in October.
This would take the annual bill for a household using a typical amount of gas and electricity to £1,697 a year – but Cornwall Insight said there was “significant uncertainty” over the forecast.
“The cap still remains hundreds of pounds above pre-pandemic prices, even when adjusting for inflation. Furthermore, there is little indication that prices will reduce substantially over the next few years,” it said.
Ofgem is urging people to consider fixed deals, which the regulator said could lead to a £200 annual saving.
Those already on fixed deals will not see any change to their monthly payments following Tuesday’s price cap change.
Currently 35% of billpayers are on a fixed tariff, up from just 15% a year ago when fewer offers were available.
However, a fixed deal only sets the unit rate. Actual household bills depend on how much energy is used.
At this time of year heating is usually off, so families typically focus on the cost of cooking, particularly as food prices have been rising sharply.