£400 energy bill discounts – all you need to know about the support scheme
The Energy Bills Support Scheme is set to launch in October and run over six months, with all households connected to electricity grids in Great Britain eligible.
The Department for Business, Energy and Industrial Strategy (BEIS) which administering the scheme said its launch comes amid unprecedented rise in bills this year.
Government estimates put the number of households across Great Britain which will receive the discounts at around 29m.
It follows the £150 energy rebates given to UK households in council tax bands A to D from April which local authorities have until September to pay out.
The April rebates were launched as part of a £9.1bn package to cushion households against the blow from spiralling costs for essentials, including energy bills.
The scheme running from October is worth £11.7bn and comes as part of a wider £37bn package put together for households over winter as the energy price cap is expected to rise again in autumn.
How will the discounts be paid?
Discounts on household energy bills will be applied by the suppliers themselves, meaning people paying through direct debits will get them automatically.
The first two discounts in October and November are set to be worth £66.
They are then due to rise to £67 for the four remaining months of the scheme, ending in March next year.
The discounts will be applied monthly, regardless of whether households pay on a monthly, quarterly or yearly basis.
Discounts will either be applied to the bills themselves or households will be refunded after money is debited from their accounts.
The Government said there should be no need for households to contact their suppliers but they should get in touch with them if they do not get the October discount.
What if households do not pay by direct debit?
If households are standard credit customers or payment card customers the discounts will be automatically applied as credit in the first week of each month of the scheme.
Credit is set to appear on bills as it would if customers had made a payment.
Households with smart pre-payment meters are due to get their discounts credit to the meter in the first week of each month.
For households making payments according to traditional meters, redeemable vouchers or Special Action Messages (SAMs) will be sent in the first week of every month.
They will be sent to those households in the first week of every month, either by text message, post or email.
Customers will then need to cash the vouchers in at the top-up point where they usually pay their bills.
The Government said traditional pre-payment meter customers must ensure their supplier has up-to-date contact details.
People not paying by direct debit became an issue in the East Riding when the £150 rebates were distributed.
An estimated 30,000 in the East Riding did not pay council tax by direct debit, meaning they did not get the rebates automatically.
The Government said landlords who include bills in rent payments have to pass on the discount to their tenants.
Landlords who resell electricity to tenants based on energy usage are required to follow maximum price rules.
The Government said landlords doing that would be expected to pass on the discounts to tenants when reselling, with the maximum price set at the amount paid by the reseller.
Will people living in park homes, houseboats or those off the energy grid get the discounts?
Households need to have a domestic electricity meter and a direct relationship to their supplier to qualify for the Support Scheme.
But the Government said it would provide further funding for the 1 per cent of British households who live off the energy grid.
That support would be equal to the £400 discounts for households with domestic electricity meters.
The Government is set to unveil more details about how it will support those households in autumn.
What if a household’s or supplier’s circumstances change during the scheme?
Electricity suppliers are set to apply discounts according to meter points so households who switch suppliers should not be affected.
The scheme has multiple qualifying dates so households coming onto the grid from October to March should get the relevant portion of the £400 total on offer.
Suppliers who go bust or who are unable to get discounts to customers are required to tell BEIS and Ofgem what their plans are to ensure they are applied.
The Government said households would not be penalised in such circumstances or if they switch payment methods and regardless of that, their supplier or tariff.
Suppliers will also be expected and encouraged to prioritise moving households with large arrears onto repayment plans where possible.
Do people with multiple homes get corresponding numbers of discounts?
The Government has said that although people with more than one home will get multiple discounts, taking extra properties out of the scheme could delay the whole process.
Officials are also concerned it could mean people paying on behalf of elderly, disabled or otherwise vulnerable relatives may not get the discounts.
The Government also said the scheme was not targeted at those households struggling the most with rising bills because they were getting support on top of the discounts.
Households will also not be able to directly donate the £400 to charity but the Government said they could give their own money away instead.