Energy Secretary Ed Miliband has issued a direct warning to the UK's energy suppliers, demanding they pass on every single penny of savings announced in the recent Budget directly to consumers.
Government's Clear Expectation for Bill Cuts
In a letter exclusively seen by The Sunday Mirror, Miliband stated that the government's intervention in the Budget is designed to take an average of £150 off people's energy bills starting in April 2026. He emphasised that this action is a core part of the government's commitment to ease the financial pressure on millions of families across the country.
"Energy prices remain too high," Miliband wrote, highlighting the anxiety that energy costs cause for many households. He set out the clear expectation that the savings must benefit all consumers, including the significant portion of the market – around 37% – who are currently on existing fixed-term tariffs.
How the £150 Saving is Achieved
The savings follow Chancellor Rachel Reeves's first Budget, delivered on Wednesday. The government has ditched two key levies that were adding to household costs.
Firstly, the Tory-era energy company obligation, a home insulation scheme, has been scrapped. This move is expected to save a typical household £67 a year.
Secondly, a partial removal of the renewables obligation levy will prevent an estimated £78 from being added to the average annual gas and electricity bill from April.
Combined, these measures create the total average saving of £150 for households next year.
Meeting Manifesto Pledges and the Labour Choice
Labour sources indicate that, when combined with the £150 Warm Homes Discount received by six million families, the party can claim it has met its manifesto pledge to cut energy bills by £300 for those households.
During the Budget speech, Chancellor Reeves contrasted her government's approach with that of the previous administration. "Money off bills, and in the pockets of working people. That is my choice," she declared. "Not to leave working families to bear the brunt of high prices, like the Tories did. But to get energy costs down now and in the years to come. That is the Labour choice."
The ball is now in the court of energy companies, who are under strict instruction from the Energy Secretary to ensure these vital savings reach every household as intended.
