British Gas is lowering prices on its dual-fuel Click Energy 2 online tariff by a further £4 a year on average.
Lower wholesale prices have led to the cut
Last week, as part of an across-the- board lowering of prices, British Gas set its Click Energy 2 tariff at an average of £789 a year.
After the latest cut, announced on Friday, dual-fuel customers can now expect to pay £785 on average.
On Thursday, rival Powergen pledged to keep its standard tariffs below that of British Gas to September 2008.
British Gas told the BBC that its Click Energy 2 tariff, which becomes available on 12 March but can be signed up to now, was the lowest in the market of its type.
A price war seems to be emerging in the UK energy market.
Over the past few months, wholesale prices have fallen dramatically, following the opening of new pipelines from Norway and the Netherlands.
Last week, British Gas announced it was lowering its residential tariffs by 17% for gas and 11% for electricity customers from March 12.