The government has set out decisive action to support people and businesses with their energy bills, and tackle the root causes of the issues in the UK energy market through increased supply – ensuring the country is not left in the same position again.
The Energy Price Guarantee will ensure that a typical household in Great Britain pays an average £2,500 a year on their energy bill, for the next 2 years, from 1 October 2022.
The consumer saving will be based on usage, but a typical household will save at least £1,000 a year (based on current prices from October). Energy suppliers will be fully compensated for the cost of the Energy Price Guarantee.
This is in addition to the £400 Energy Bills Support Scheme. This will be paid in 6 instalments from October. The most vulnerable UK households will also continue to receive £1,200 of support provided in instalments over the year.
An additional discretionary fund will be available for those households who are outside of the schemes. For example, households not on standard gas / electricity contracts.
How the Energy Price Guarantee will be applied to energy bills
You do not need to apply, and there’s no need to contact your energy supplier. For consumers in England, Scotland and Wales who pay for their energy through a monthly, quarterly or other regular bill, the Energy Price Guarantee will be applied when your bill is calculated.
If you’re on a pre-payment meter…
For GB pre-payment meter customers, the Energy Price Guarantee will be applied to the rate you pay for each unit of energy, so the money you put on the meter will last longer than would otherwise have been the case this winter
If you’re on a standard variable tariff...
The average unit price for dual fuel customers paying by direct debit will be limited to 34.0p/kWh for electricity and 10.3p/kWh for gas, inclusive of VAT, from 1 October.
These unit prices have been passed to suppliers to ensure that they are used to calculate bills on time for 1 October.
Energy suppliers will adjust standard variable tariffs automatically. Customers on standard variable tariffs do not need to take any action to get the benefits of this scheme.
If you pay for electricity as part of your rent...
The Energy Price Guarantee is applied per unit of gas or electricity used for households with a domestic electricity connection, so will be applied if your landlord has a domestic electricity contract with a licensed electricity supplier.
Your landlord may be reselling the electricity to you based on your usage, in which case:
they must comply with the maximum resale price rules which say they must not make a profit
the maximum resale price for electricity is currently set at the same price as that paid by the person reselling it
We hope this helps. For more information, please click here.
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