Declining energy consumption is placing further pressure on suppliers' margins, with average consumers paying less than suggested by the price cap.
Typical annual bills are ~13% lower than the headline price cap in Q3-24, as Ofgem's TDCVs haven't kept pace with falling consumption since the energy crisis.
![](https://bfy-group.transforms.svdcdn.com/production/20240711-PriceCap-Consumption.jpg?w=4000&h=2250&auto=compress%2Cformat&fit=crop&dm=1721982017&s=541cd63c55ddc43dd0074edbbd97d223)
Analysis from John de Bono compares annual bills based on actual median consumption, with the headline figures for each price cap period.
With the EBIT allowance capped by Ofgem, falling consumption means a smaller profit pool available to energy suppliers, potentially limiting the availability of capital to invest in other areas.
For more on the impact of declining consumption, and future price cap projections, contact Tom Bromwich.
Tom Bromwich
Director
Tom leads client engagements with a particular focus on commercial strategy, pricing, customer acquisition and retention.
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