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Energy Bills Rebate

Question for Treasury

UIN 120855, tabled on 8 February 2022

To ask the Chancellor of the Exchequer, what estimate he has made of how much a single household of two people will receive from the Energy Bill Discount Scheme in 2022-23; and if that household subsequently split into two households of one person each from financial year 2023-24, how much they would each pay in (a) 2023-24 and (b) each subsequent year via the standing charge.

Answered on

15 February 2022

All domestic electricity customers in Great Britain will receive a £200 reduction in their electricity costs from this October. This will be delivered via energy suppliers and will be clearly identifiable as a line item on electricity bills. All domestic energy consumers will pay a charge in future years. This will be reflected by Ofgem in the price cap for future years, and sufficient notice will be given to suppliers to price it into fixed and other tariffs.

We expect households will pay this back from 2023 – when energy prices are expected to be lower - through an increase to standing charges on their bills of around £40 per annum over five years. However to be clear, this is not a loan to either suppliers or households.

There will be cases where changes in people’s personal circumstances mean they may not directly be the recipient of the reduction, but still pay charges in future bills, or vice versa.

This approach is fiscally responsible while also helping customers manage the unprecedented increase in energy bills by spreading the increased costs of global prices over time. The policy will provide a significant reduction to bills this year whilst gas prices are at historic highs.

Answered by

Treasury