Household energy bills are expected to fall by nearly £850 from July, according to energy market consultancy Cornwall Insight.
Analysts predicted the cap for April will hit £3,294 when Ofgem releases the information next Monday, 27 February.
Consumers will not be directly impacted by the price cap thanks to the Energy Price Guarantee (EPG), which will limit a typical household bill to £3,000, up from the current rate of £2,500.
The remaining £294 will continue to be subsidised by the government, although raising the EPG to £3,000 in April is expected to save the government £2.6bn across the entire scheme.
However, in July, the household price cap is forecasted to fall again to £2,153 and then move slightly higher in October to £2,161.
Dr Craig Lowrey, principal consultant at Cornwall Insight said that what households actually pay will likely rise despite the energy cap shrinking.
This is due to the EPG rising to £3,000 and the £400 energy rebate scheme ending in March.
However, the second half of the year signals the first time the cap should fall below the government support price for the first time since the introduction of the energy price guarantee scheme in October.
“This gives us some hope for optimism as far as the wider energy debate is concerned,” said Lowrey.
“While prices under the cap remain considerably higher than historic norms, the combination of falling wholesale prices and an increase in the EPG could see the return of competitive tariffs, and with it the chance for consumers to take back some control over their energy bills.”