Octopus Energy and British Gas Confirm Major Drop in Energy Bills for All Customers
In a welcome development for households across the UK, energy providers Octopus Energy and British Gas have confirmed that all their customers will see significant reductions in their energy bills following recent government measures announced in the autumn budget. This includes customers on fixed-term deals, a group previously uncertain about benefiting from the cuts.
Government’s Budget Measures to Lower Energy Costs
In her November budget, Chancellor Rachel Reeves introduced a series of measures aimed at reducing the cost of energy for consumers in England, Scotland, and Wales. The government targeted various green levies that are usually incorporated into customer bills. Key changes included ending the government’s Energy Company Obligation (ECO) scheme and cutting the amount households pay towards the Renewables Obligation scheme.
These adjustments are expected to bring an average annual household energy bill reduction of around ÂŁ150, providing much-needed relief amid rising living costs.
Octopus Energy’s Commitment to Passing on Savings
Octopus Energy, a leading player in the UK’s energy market known for its customer-focused approach, has announced that all customers will receive the benefit of these government policy changes automatically from 1 April 2026. This applies across both variable tariffs and fixed-term contracts.
Greg Jackson, CEO of Octopus Energy, said: “These changes will bring a welcome relief to customers, and we’ll pass them through on all of our tariffs as soon as they kick in, so no one misses out.” He confirmed that typical customers could expect a reduction of approximately ÂŁ134 on their yearly bills.
British Gas Also to Pass Savings to Customers
British Gas, another major energy supplier, has also assured customers that they will see savings from the policy changes, although the company has not specified when these reductions will take effect.
MoneySavingExpert, a well-regarded consumer advice platform, has confirmed that British Gas intends to pass the savings on but is yet to provide a timeline for the implementation.
Impact and Consumer Confidence
Prior to these announcements, there was some uncertainty about whether customers locked into fixed deals would receive any relief from the government’s energy cost-cutting measures. Both Octopus Energy and British Gas clarifications bring reassurance that no customer segment will be excluded.
The reduction in green levies cuts directly into what households pay on energy bills, signaling the government’s commitment to tackling the energy affordability crisis currently impacting many UK families.
Wider Context: Energy Market and Economy
This news comes amid wider economic challenges, including a rise in the UK’s unemployment rate, which recently increased to 5.1%, affecting particularly young workers. Rising costs have also led some sectors, such as hospitality, to struggle with increased expenses, as highlighted by Michelin-star chef Tommy Banks’ decision to close his restaurants on Christmas Day citing surging costs including VAT hikes and employer contributions.
At the same time, oil prices have fallen to their lowest levels since 2021, which some analysts hope will translate into fuel price cuts before the busy holiday season.
What This Means For Consumers
For UK households, the confirmation from Octopus and British Gas means the government’s interventions to curb escalating energy bills will benefit everyone, not just those on variable tariffs. Consumers locked into fixed-term contracts can expect automatic adjustments from early next year, ensuring they also share in the savings.
Households are encouraged to keep an eye on communications from their energy providers in the coming months for specific details on their new billing rates. Additionally, consumers may consider reviewing their tariffs around April to confirm they are receiving the full benefit of the reductions.
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This report reflects the latest confirmed details as of December 16, 2025.