British Gas, OVO, EDF, EON, Octopus customers will wake up to bonus £20

Cornwall Insight projects the price cap will fall in January, after it rose to £1717 a year from October 1 for three months until New Year's Day.

The Ofgem price cap is predicted to fall in January 2025 in 'welcome news' for customers. Cornwall Insight projects the price cap will fall in January, after it rose to £1717 a year from October 1 for three months until New Year's Day.

New projections indicate there will be a one per cent drop in January 2025 to a yearly cap of £1,697 for a typical gas and electricity customer. Dr Craig Lowrey, the principal consultant at Cornwall Insight, said: "While households will have to endure a rise in the cap from October, our current forecasts show that this is a temporary blip.

"January to March, typically some of the coldest months of the year, often bring with them the biggest energy bills, and - while our latest forecast is welcome news - it remains subject to the volatile wholesale gas and electricity markets."

READ MORE UK faces 66 hours of snow with three places 'worst hit' by flurries

"There remain a further six weeks or so for the wholesale market to influence our forecasts, and while the negligible quarter-on-quarter drop is welcome, it must be remembered that bills will still remain hundreds of pounds above historic levels," Dr Lowrey added. "While there is hope that a renewed focus on building a sustainable domestic energy supply that could eventually lower bills as we reduce reliance on volatile imports, these benefits will take time to materialise.

"Meanwhile, many people are facing financial difficulties right now. It’s important the government and other stakeholders look at actions they can take to shield vulnerable consumers whether this be targeted direct support, or changes to the bill system through additions such as social tariffs. Not everybody can wait for renewable energy savings to kick in."

Prices are also forecast to fall slightly in both the second and third quarters of next year. The drop, however slight, will be welcome news for households in England, Scotland and Wales who this week will see the average bill rise by around £12 a month or £149 a year from the current £1,568 for a typical dual fuel household in England, Scotland and Wales.