Recommendation 41

HM Government · verbatim extract Accepted

On 8 September the Prime Minister announced the Energy Price Guarantee to help households stay warm this winter. The Energy Price Guarantee will limit the amount you can be charged for each unit of gas and electricity you use in your home. The Energy Price Guarantee will apply from 1 October and ensure that a typical household in Great Britain pays, on average, no more than £2,500 a year on their energy bill, for the next 2 years. Equivalent support will be provided in Northern Ireland. This is on top of the £37 billion package of support to help households with cost of living, targeting the most vulnerable households. This includes a £11.7 billion Energy Bills Support Scheme, worth up to £400 each for around 29 million households. In addition, targeted support includes: • More than 8 million households on means tested benefits who will receive a payment of £650. • Over 8 million pensioner households who receive the Winter Fuel Payment will also receive a £300 Cost of Living Payment. • Six million households who receive disability support will receive £150 Disability Cost of Living Payment. • A £144 million discretionary fund for local authorities to distribute to those identified as in need. This is alongside existing support for the most vulnerable, including the Winter Fuel Payment, worth up to £300 and the Warm Home Discount, providing a one-off payment of £150 this November. The Cold Weather Payment, which is a £25 payment for vulnerable households on qualifying benefits, is also available to help with the cost of bills when the weather is, or expected to be, unusually cold. On 21 September details of a new government Energy Bill Relief Scheme were announced. 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. This support will be equivalent to the Energy Price Guarantee put in place for households. It will apply to fixed contracts agreed on or after 1 April 2022, as well as to deemed, variable and flexible tariffs and contracts. It will apply to energy usage from 1 October 2022 to 31 March 2023, running for an initial 6-month period for all non-domestic energy users. The savings will be first seen in October bills, which are typically received in November. As with the Energy Price Guarantee for households, customers do not need to take action or apply to the scheme to access the support. Support (in the form of a p/kWh discount) will automatically be applied to bills. Responses to the Committee’s Third Report of Session 2022–23 11 Longer term, we must continue to decarbonise and increase our energy security which will in turn reduce bills and shield consumers from volatile fossil fuel markets. The British Energy Security Strategy sets out our plan to reduce the UK’s reliance on expensive fossil fuels, and boosting our diverse sources of homegrown energy for greater energy security in the long-term. This includes investing in the energy transition. For example, we have recently awarded Contracts for Difference to a record 93 new renewable energy projects, which will total almost 11GW of new generating capacity for Great Britain – enough to generate sufficient electricity to power around 12 million homes. The Contracts for Difference scheme has contributed to the price per unit (MWh) of electricity generated by offshore wind falling by almost 70% between the first Contracts for Difference auction in 2015 and the fourth in 2022.