Several energy companies have announced plans to provide significant savings to customers in the upcoming year, with one company indicating potential reductions of up to £134 per household. This commitment follows Chancellor Rachel Reeves’ promise during the Autumn Budget to address escalating energy costs directly.
The initiatives involve eliminating ‘legacy costs’ and environmental charges that have previously contributed to high electricity prices. Experts in the industry estimate that households could save an average of £134 through these policy adjustments alone, a move supported by major energy providers in the UK.
Octopus Energy has committed to passing on the benefits of the Autumn Budget to its customers, with bill reductions scheduled to begin on April 1, 2026. The company views this action as essential to its goal of fostering a fairer and more accessible energy market, while also urging other companies to follow suit.
Greg Jackson, the CEO and Founder of Octopus Energy, expressed his satisfaction with the government’s actions, stating that the changes will bring relief to customers. He assured that the reductions will be implemented across all tariffs automatically, ensuring no customer misses out on the savings.
Similarly, British Gas has confirmed its intention to transfer the energy cost reductions to all customers on fixed tariffs starting on April 1. A spokesperson for British Gas welcomed the government’s efforts to alleviate energy costs, emphasizing the importance of moving levies into general taxation.
The government has also announced the conclusion of the Energy Company Obligation Scheme in March 2026, along with a reduction in household contributions towards the Renewables Obligation (RO) scheme through energy bills.
Despite the promised savings from these adjustments, future energy bills will still be influenced by fluctuating wholesale energy rates. Ministers project that their policies will result in savings of £150 for the average household, broken down into £88 from RO policy changes, £59 from ECO policy adjustments, and £7 from combined VAT.
Ofgem has indicated that these changes will lead to a £134 reduction in the price cap for standard dual-fuel households, which typically consume less electricity than other household types.