The Chancellor made the announcement during the Autumn Budget on Wednesday (November 26)
Everything you need to know about £150 energy bill reduction:
- The Chancellor said she was taking action to get energy bills down and cut the cost of living in the Autumn Budget. Rachel Reeves announced that households across the UK will see an average of £150 cut from the average energy bill from next year.
- Ms Reeves explained that she would do this by ditching the ECO (Energy Company Obligation) scheme introduced by the Tories in government, which she claimed had cost UK households £1.7 billion a year on their bills. The current four-year scheme expires in March 2026.
- Documents from the Office for Budget Responsibility also show another levy from the renewables obligation will be partly removed, temporarily. It currently adds around £90 to the average annual gas and electricity bills. Read the full story here.
- Martin Lewis has issued some extra details on the energy bill reduction after speaking to a senior member of the government. He confirmed that the reduction will start at the April 1 2026 price cap and will be equivalent to a rough 3.3p reduction in the electricity unit rate and 0.3p reduction in the gas (pre VAT).
- The MoneySavingExpert founder also said he had pushed hard on whether this reduction will apply to those on fixes tariffs. He said: “I was told ‘the government has clear expectations this cut will be passed on in full by suppliers’ though the details aren’t there yet.” Read the full story here.