Households on prepayment meters are set to see their energy bills drop as extra costs on the pay-as-you-go meters are scrapped from July.
Chancellor Jeremy Hunt confirmed that the "prepayment premium" will be coming to an end, meaning that more than four million households affected will save around £45 a year on their energy costs. Those on prepayment meters, typically vulnerable or low income households, currently pay more on average than direct debit customers due to firms managing the meters passing costs down.
The change is expected to come into effect from July 1, with the Chancellor set to announce the plans in his Spring Budget as part of reforms to the Government's Energy Price Guarantee. The guarantee, which currently caps the average household energy bill at £2,500 a year amid the cost of living crisis, was due to increase by £500 next month to £3,000.
