Millions of households in the UK are now receiving notifications regarding a one-time £150 reduction on their electricity bills starting today. The correspondence outlines details about the Warm Home Discount program, which has reopened to provide a direct £150 deduction on electricity bills, with the payment transmitted to the energy supplier.
Typically, this discount is applied between late October and March and is accessible to households where an individual was receiving specific benefits on the qualifying date, which varies annually. For this year, the qualifying date is August 24, and eligibility requires receipt of certain benefits on this date.
Residents in England and Wales will automatically receive the Warm Home Discount, while in Scotland, only those receiving the Guarantee Credit element of Pension Credit will receive it automatically. For other qualifying benefits, manual application through the energy supplier is necessary, as the scheme is not available in Northern Ireland.
The Department for Energy Security and Net Zero (DESNZ) has confirmed the removal of the high energy use requirement for the Warm Home Discount in England and Wales. Previously, individuals had to demonstrate high energy costs to qualify for benefits other than Pension Credit, but this criterion has been eliminated.
DESNZ estimates an increase in the total number of households receiving the discount, possibly reaching 6.1 million, a rise of 2.7 million. Concurrently, energy bills have escalated, with the Ofgem price cap elevating to £1,755 for a standard dual fuel household under direct debit payment. This price cap remains effective until December 31 for customers on a standard variable rate tariff.
While the cap sets limits on unit charges for gas and electricity, as well as standing charges, the actual bill is based on individual energy consumption. Ofgem’s price cap is calculated considering average household energy usage levels, assuming 2,700 kWh of electricity and 11,500 kWh of gas consumed annually.