Cornwall Insight responds to the government’s announcement on the EPG

The predictions for the Default Tariff Cap in this piece are out of date please click HERE to find our most up to date forecasts.

Dr Craig Lowrey, Principal Consultant at Cornwall Insight said:

“The announcement that the government will maintain the Energy Price Guarantee (EPG) at £2,500 has provided much-needed clarity for energy suppliers and no doubt relief for the many households who rely on the scheme to safeguard their finances from the volatile energy market. While the government’s decision will come at an estimated additional cost of £2.6bn1 for the three months to July, Default Tariff Cap (price cap) predictions indicate that the EPG costs will be short-lived, as average bills are expected to drop well below £2,500 in the latter half of the year. It’s a small price to pay to protect already hard-hit households.”

Figure 1: Cornwall Insight’s Default tariff cap forecasts for a typical household

Source: Cornwall Insight – predictions based on market closing figures from 23/03/2023

1.    The total governmental cost of the EPG is an estimated 29.4bn
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Notes to Editors
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About the Cornwall Insight Group
Cornwall Insight is the pre-eminent provider of research, analysis, consulting and training to businesses and stakeholders engaged in the Australian, Great British, and Irish energy markets. To support our customers, we leverage a powerful combination of analytical capability, a detailed appreciation of regulation codes and policy frameworks, and a practical understanding of how markets function.