Unreliable renewables will make energy more costly

It is of course good news that the Ofgem price cap for a dual fuel household bill will fall from £1,928 to £1,690 from April (that is the bill paid by the average householder). It means that there should be strong downwards pressure on inflation (the Consumer Prices Index) in April. Barring a jolt in inflation in other goods and services or an acceleration in earnings it ought to mean the Bank of England finally has the courage to cut its base rate, probably in May.

None of that, though, should distract from the fact that energy prices in Britain remain far too high. For one thing, the huge fall in wholesale gas prices since their peak of 634 pence per therm in August 2022 has not yet been fully passed on. The wholesale gas price today is 55.6 pence per therm, back to where it was in the spring of 2021.