Ofgem announced its energy price cap at an annual level of £3,280 for a dual fuel household paying by direct debit based on typical consumption from April.
The forecast decrease, which is estimated to represent an 18 per cent reduction for customers paying by direct debit, comes after Ofgem confirmed household prices would “drop considerably” from July.
However, Cornwall Insight warned prices would still not drop to as low as they were before the pandemic.
Energy experts at Cornwall Insight predict prices could plummet to as low as £2,055 a year for the average family
The group’s advisors said: “Despite the cap falling from the sky-high prices of the past two years, the figure remains over £1,000 per year more than the price cap levels seen prior to the pandemic.
“We do not currently expect bills to return to pre-2020 levels before the end of the decade at the earliest.”
Despite predicting an average consumer price drop of around £450, Cornwall Insight’s principal consultant Dr Craig Lowrey added: “While bills are falling, the cap is still expected to remain comparatively high against historic norms, and those hoping to see a return to the kinds of bills seen at the start of the decade will be disappointed.
“Regrettably, it looks as if these prices may become the new normal.”
Environment Secretary Therese Coffey appeared to dismiss the possibility of further assistance to struggling households
Energy Secretary Grant Shapps recently predicted energy bills would start to fall in mid-June.
He said: “What we’re starting to see, or have seen on the wholesale price, those energy prices falling below that cap and getting back to more . . . normal prices.
“Now people haven’t seen all that benefit, much of it, or even any of it yet, but about another six weeks, the summer, that should start to feed into people’s electricity bills.”
However, Environment Secretary Therese Coffey appeared to dismiss the possibility of further assistance to struggling households.
Coffey, who served as Deputy Prime Minister during Liz Truss’s 49 days in Downing Street, also stressed the Government’s main focus is to enhance the UK’s domestic energy sources and highlighted how Chancellor Jeremy Hunt provided support several months ago.