Martin Lewis explains what the energy price cap really means for households

Martin Lewis has confirmed ‘things will be better’ from April and pre-payment metres will help lower costs after the energy price cap was announced today.

Households are set to pay £238 less a year in energy bills after Ofgem announced its price cap.

This is a 12.3% drop from the current £1,928 to £1,690 from April in England, Scotland and Wales.

But the money saving expert said on Good Morning Britain to ‘forget these figures’ as ‘they were made up based on typical usage’.

He also explained these figures were a projection of a year, when the price cap will only last for three months.

‘For every £100 of energy you are paying at the moment, on the same usage you will pay £87.70 from April 1, and we expect them to drop again on July 1,’ he said.

‘But these are still double the cheapest prices we had before the price cap.

‘Big picture: It is better news from April 1, but I can’t go as far to call it good news.’

He descried pre-payment metres as ‘the big change’, saying they will probably be the cheapest way to pay.

‘It will typically be 3% cheaper than paying by direct debit,’ he said.

‘The fact prepayment metres will now be cheaper is absolutely gobsmacking.’

But Mr Lewis urged caution to those who were thinking of switching to prepayment metres.

‘If and when market competition comes back, paying by direct debit will be offer the most savings.’

Get in touch with our news team by emailing us at webnews@metro.co.uk.

For more stories like this, check our news page.