The latest on energy bill prices

In yesterday’s budget, chancellor Rachel Reeves confirmed that households in England, Scotland and Wales will see their energy bills fall by around £150 a year on average.

Here’s how the government plans to deliver those savings.

Ending the energy company obligation scheme

What’s changing?

The government will end the energy company obligation (ECO), including the Great British insulation scheme (GBIS), in March 2026.

These schemes were designed to help households cut heating costs by offering free or low-cost insulation and other energy-efficiency measures.

Why end the scheme?

The ECO and GBIS programmes have faced criticism. Earlier this year, the government admitted to ‘systemic failure’ in solid wall insulation installed under these schemes.

Will support still be available?

Support will still be available but targeted differently.

Some low-income households in England may be eligible for help through the Warm Homes Plan, which will receive an additional £1.5bn to tackle fuel poverty.

Reducing the cost of the renewables obligation (RO)

The renewables obligation scheme supports renewable power generation, such as solar and wind. Until now, the cost of these investments has been fully funded by consumers through a charge on electricity bills.

What’s changing in 2026?

From 1 April 2026, the government will fund 75% of RO costs for three years.

This means:

• a typical household’s electricity bill will fall by £92 a year
• the government support ends March 2029, after which these costs are expected to return to bills

How much will bills actually fall?

Taken together, the ECO changes and RO support are expected to save a typical dual-fuel household around £150 a year from April 2026.

The reduction will mostly be seen on electricity bills, with unit rates being reduced as follows:

• electricity: down 3.37p/kWh (3.54p including VAT)
• gas: down 0.31p/kWh (0.35p including VAT)

The government says energy regulator Ofgem will work with suppliers to ensure these savings are passed on to those who are already on fixed tariffs as at 1 April 2026.

What help can you get with energy costs?

If you’re struggling to keep up with your energy bills right now, then there are options available.

Firstly, speak to your supplier about any help they can provide, such as grants.

We can also help you check you’re claiming all the benefits you’re entitled to, offer budgeting tips and talk you through the range of debt solutions available. 

It’s also well worth reading our guide on what to do about energy arrears.