New government energy bills scheme announced.

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The government has announced (8 Sept) changes to how energy bills will be charged to help reduce the impact of the proposed October price cap. The new Prime Minister, Liz Truss, has said that average bills will be held at £2,500, under a scheme called the Energy Price Guarantee (EPG), for the next two years. This means that the October price cap, announced by Ofgem (26 August) will no longer be implemented in full for customers.

You will still pay for the gas and electricity you use. But the government's Energy Price Guarantee will limit the price that we can charge for each unit of energy. However, if you use more gas or electricity, you will pay more. The scheme does not cap your bill at £2,500, your bill amount is still based on how much energy you use.

Energy Price Guarantee.
To limit the amount customers' bills go up by, the government will compensate energy firms for the difference between the wholesale price for gas and electricity they pay and the amount they can charge customers.

From 1 October the government will supplement what customers pay for energy which means that instead of the typical household dual-fuel bill rising to £3,549, a typical household will now see an average annual bill of £2,500. You will pay above this amount if you use more energy than you would do normally. The government says that it will pay for the subsidy, which means that customers will not be expected to repay the support.

No action is required from customers. We are evaluating how the government's Energy Price Guarantee scheme will affect customers and we will be in touch in the coming weeks.

Pre-payment customers.
For pre-payment meter customers, the government says that 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.

As is the case with the ‘price cap’ under the Energy Price Guarantee there will continue to be a small difference between the unit cost for a pre-payment meter customer and other bill payers.

Fixed tariff customers.
The government says that customers on a fixed tariff will also receive the same level of price reduction as those on standard variable tariffs, but what they pay is dependent on the rate they fixed at. Customers do not need to contact us, we will be in touch with you shortly as to how the Energy Price Guarantee affects you.

For the small number of customers who fixed at a high rate exceeding the October Ofgem price cap of £3,549 (£3,674 paying on receipt of bill), they will receive the full discount of 16.998p for electricity and 4.2p for gas. To make sure that those customers also benefit from the EPG we will bring their fixed price down to be in line with the government £2,500 average threshold.

Businesses and SME.
A new six-month scheme for businesses and other non-domestic energy users will offer equivalent EPG support. On 21 September the government announced their Energy Bill Relief Scheme (EBRS) will provide a discount on wholesale gas and electricity prices for all non-domestic customers (including all UK businesses, the voluntary sector like charities and the public sector such as schools and hospitals) whose current gas and electricity prices have been significantly inflated in light of global energy prices.

We’re working with the government and Ofgem to find out how these changes will affect our customers and will update this page when we have more information.

Rising bills help.
We want to reassure you that we are dedicated to helping you where we can. We have put together some helpful resources where you can access support from us, charities and the government.
What should I do about my energy tariff?
Regardless of the tariff you're on, you are protected by the new EPG and do not need to take action. We'll be in touch with customers on fixed tariffs about next steps.

Contact our Energy Specialists if you’re having difficulty.
Our Energy Specialists are here to help you if you’re concerned about your energy bills. If you’re struggling to pay, please visit our help page to find out more about how we can support you. You can reach out to our Energy Specialists for personal advice on Facebook and Twitter.

​​​​​​​Blog updated 1400hrs 21/09/22