Families will start to feel the benefits of changes from April
Chancellor Rachel Reeves.(Image: Getty Images)
Millions of households can look forward to a cost-of-living boost in 2026.
Average energy bills are set to be slashed by £150 a year following decisions by Chancellor Rachel Reeves to help save on household costs.
Major names like British Gas, Octopus and Eon have confirmed they will be passing on the savings to those on variable and fixed tariffs.
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It will see millions of households pay less for their gas and electricity.
While there will be a very slight rise to bills from January – around £3 a year – tangible savings should begin to be felt from April.
It follows the first half of a decade which has been dominated by cost of living pressures.
Changes to the ways households will be charged for their energy were announced at the Budget.
Those who have sought to escape high rates by switching to fixed tariffs will also benefit, it has been confirmed.
Richard Neudegg, director of regulation at Uswitch, said: “Households can now confidently sign up with these suppliers for a fixed deal that will effectively save them money twice.
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“They can secure cheaper rates now during the coldest months of winter, and they’ll see their prices drop even further in April without having to take any further action.”
Prime Minister Keir Starmer has vowed 2026 will be the year Brits start to feel better off as a result of Labour policies.
He said in a new year statement: “In 2026, the choices we’ve made will mean more people will begin to feel positive change in your bills, your communities and your health service.
“But even more people will feel once again a sense of hope, a belief that things can and will get better, feel that the promise of renewal can become a reality, and my government will make it that reality.
“More police on the streets by March. Energy bills down and the number of new health hubs up in April.
“More funding for local communities. And with that change, decline will be reversed.”