Details on new plan to help support households from the soaring energy costs announced by the Prime Minister, Liz Truss.
With a typical household energy bill due to rise to £3,549 a year from October, millions of families across the UK are not able to afford to pay for their gas and electricity.
The bills have been creeping up rapidly over the last few months, brought on by Putin’s war in Ukraine.
From January 2023, Cornwall Insight has predicted energy bills are set to rise to £5,387 a year and £6,616 a year from April 2023!
We have seen some support to now, but the costs are going up faster than the previous ideas of help can cover.
Here are the new plans to help households with energy costs.
Energy price guarantee – a limit on energy bills
In England, Scotland and Wales, an energy limit will be set at £2,500.
This will set a revised cap on energy rates.
The current price cap is £1,971 per year for a typical use property, so there is still an increase, but not as high as Ofgem had first said.
However, be conscious that if you use more energy, you will end up paying more than this as it’s a “typical household” cap.
The cap on pricing is on the unit rates you use.
If you use less energy, you may end up paying less. If you use more energy, you will pay more than £2,500.
The support will come into force from 1st October 2022.
This cap will be in place for two years.
This is in addition to the £400 support scheme that was already announced months ago.
Businesses will also get an equivalent guarantee for 6 months.
Who won’t this help?
Unfortunately, the help brought in won’t help a few people who fall through the cracks.
This is because they are outside of the regulations on energy price caps.
Any households who use heating oil rather than gas or electricity, people who are living in mobile park homes or people in a heat network will have a separate fund for equivalent support.
Where a landlord includes energy bills as part of a rent payment should pass on any savings…
However, if you need more support, get in touch with your local council regarding financial help from the Household Support Fund.
How can I save on energy costs?
While this cap on energy rates will help, overall, saving money is all about reducing your overall consumption.
Little changes here and there can make a difference. Take a look at 50 ideas to save money on energy bills.
You can also get support from the Warm Home Discount. This will give you £150 in credit on your bill.
Naomi knows the burden of living on very little and became debt free by following her own money saving tips and tricks. She is an expert on saving money at the supermarket and side hustles.
