Today’s Budget brings a modest but welcome reduction in energy bills. After five turbulent years, any drop in costs offers relief to households who have been stretched to breaking point. Our analysis suggests the average bill will fall to around £1,665 from April 2026 — a step in the right direction and recognition that further action on affordability is needed.
But the job is far from done. Bills will still be significantly higher than before the crisis and the UK now faces a 25% shortfall in energy efficiency funding with the end of the ECO scheme. Without restoring long-term investment in warm homes and reforming the way energy is priced, millions will continue to face unnecessary hardship.
A spokesperson for the End Fuel Poverty Coalition commented:
“Any reduction in energy bills will be welcome as households face their fifth winter of the energy costs crisis and the Government is right to be investing in the Warm Homes Plan to help improve the energy efficiency of peoples’ homes.
“But no one can warm their home with Budget headlines, and the Chancellor’s statement also highlights the scale of the challenge.
“Even with the changes announced, we expect that from April 2026, average energy bills will still be hundreds of pounds higher than they were in winter 2020/2021 and £97 higher than at the General Election.*
“The millions of households who will still be struggling with the cost of energy need further bold action from the Government in reform of energy pricing, targeting energy bill support at those who need it, delivering on a new fuel poverty strategy and in creating an ambitious Warm Homes Plan to upgrade cold, damp homes.
“And we’d also urge the Chancellor to address a c.25% projected shortfall in total energy efficiency funding in future budgets after the ECO scheme is scrapped.”
* End Fuel Poverty Coalition estimates based on the current price cap, the Ofgem 1 January price cap announcement, industry analysts forecasts and the Chancellor’s statement / Budget documents. Price cap comparison points:
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01/01/2021 — £1,042
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01/07/2024 — £1,568
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01/10/2025 — £1,755
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01/01/2026 — £1,758
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01/04/2026 — £1,665