The move, which will take place on March 26, will see npower's two million residential gas customers pay on average £50 less.

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It is also overhauling its discounts for those who pay by monthly direct debit, which will see the 12-month anniversary discount available to electricity customers double to £40, equivalent to 4.8 per cent off their electricity bill.

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Npower's cut comes after British Gas, E.ON and Scottish & Southern Energy reduced prices in recent weeks in response to sharply lower wholesale energy costs.

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Today's announcement will reduce tariffs by 6.7% on average for npower's single fuel gas customers who pay quarterly on receipt of their bill.

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It added that, by taking into account the additional discounts offered for paying monthly by direct debit, the average npower gas bill reduces by 7.8%.

Dual fuel customers will benefit from a 7.1% cut on average, including the changes to the monthly direct debit discounts.

The group has 100,000 out of two million gas customers on monthly
direct debit payment plans, which allows households to pay a flat rate every month throughout the year - reviewed every six months to check cost against usage.

Around 350,000 out of 4.2 million electricity customers pay by monthly direct debit.

By regions, the biggest cut for monthly direct debit gas customers is 13% in the East Midlands, with the smallest being a 2% cut in Wales.
For those who pay quarterly on receipt of bill, the price cuts vary from 9% in the East Midlands to 2% in Wales.

Consumer Focus said that, for those who pay by monthly direct debit, npower would be the second cheapest of the "big six" for gas, behind E.ON, but is still the third most expensive for electricity.
The only two of the major providers yet to cut prices in the latest round of reductions are Scottish Power and EDF.