The UK's energy regulator, Ofgem, on September 6 proposed a price cap on default energy bills that it said would save households about a billion pounds ($1.3 billion) a year.
"When the price cap is introduced suppliers will have to cut their prices to the level of or below the cap, proposed to be £1,136 per year for a typical dual fuel customer" whose pay monthly from their bank accounts, Ofgem said Thursday.
Ofgem said a typical consumer on the most expensive tariff would save more than £120 but the exact savings each individual household will make will depend on their usage and supplier.
"This announcement marks the end of uncertainty for energy providers", noted David Madden, analyst at CMC Markets UK.
Mr Nolan also said that in addition to the tariff cap, United Kingdom households could make further savings by shopping around for better deals.
Stephen Murray, energy expert at MoneySuperMarket, said households would be better off switching to save money than relying on the cap to give them a fair deal.
Centrica said: "Since the announcement of the CMA investigation into the functioning of the United Kingdom energy market over four years ago, our focus has been on making proposals to improve the functioning of the market for the benefit of customers".
The price cap applies to the so-called standard variable tariff (SVT), the most popular type of rate offered by the big six energy suppliers, as well as other default deals.
"If costs increase, Ofgem will ensure any rise will be due to genuine increases in energy costs rather than supplier profiteering", he said.
This follows Parliament passing the Government's Domestic Gas and Electricity (Tariff Cap) Act, which became law on July 19 and gives Ofgem a duty and the powers to put the price cap in place.
'Once the price cap is in place, all households in Great Britain covered by the cap will be protected from being overcharged for their energy.
Meanwhile, someone on the most expensive tariff with Scottish Power would save £121.
The cap will be reviewed every six months and will last until 2020, at which point the Government will have the chance to renew it.
Energy experts warn that the cap is still nearly £300 more expensive than the cheapest deal on the market.
She added: "It's vital that Ofgem get on and implement this cap by Christmas so that long-suffering energy customers can benefit from this vital protection".
The watchdog says it is looking to have the price cap in place by the end of the year.
An influential committee of lawmakers called Britain's energy market "broken", while Prime Minister Theresa May said the energy tariffs were a "rip-off".