What Falling Gas Prices Mean for Bills?
After skyrocketing all summer, the wholesale gas prices in the UK and Europe has dropped a lot in the past few weeks. Analysts say they don’t think prices will stay low for a long time. This is primarily because of how the gas market works. As gas prices went up sharply on foreign markets at the beginning of this year, energy costs for both homes and businesses increased significantly. So, the government stepped in and paid for some of the costs with money from taxpayers. Until April, the government’s program to guarantee energy prices puts a cap on the average household’s annual bill at about £2,500. After that, people who drive more will have to pay more for gas. Since then, wholesale prices around the world have gone down. For example, 550p per therm in August was the highest price for gas to be delivered the next day in the UK. Last week, it fell to only 38p. So, the government will have to pay fewer subsidies than it would have if wholesale prices had stayed high. But wholes...