MILLIONS of households will get money off after it was announced energy bills are set to rocket again in April.
The government today announced fresh plans to tackle the cost of living crisis that will include a £200 rebate for customers.
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Energy regulator Ofgem today said that the price cap will rise in April, pushing bills up by almost £700 a year.
The price cap is set according to wholesale costs which have rocketed over the winter.
This has already pushed up energy bills and the majority of households are now on standard price capped tariffs because they are now cheaper than new fixed deals.
The current price cap is £1,277 for the average household and the cheapest fixed deal is over £2,000.
The price cap, which is reviewed twice a year and adjusted in April and October, will shoot up by 54% to £1,971, Ofgem said.
For those on prepayment meters the price cap will rise from £1,309 to £2,017 – an increase of £708.
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Chancellor Rishi Sunak today announced that all energy customers will get a £200 discount on their energy bill to tackle the rising costs.
Speaking in Parliament today, Mr Sunak said the help will spread the worst of this year’s energy price shock over time.
? Read our Energy price cap live blog for the latest updates
He said: “This year all domestic electricity customers will get an upfront discount on their bills worth £200.
“Energy suppliers will apply the discount on people’s bills from October, with the government meeting the cost in full.”
“That discount will automatically be repaid from people’s bills in equal £40 instalments over the next five years.”
It’s understood that the repayments will start from April next year, when it’s hoped that the energy market will have returned to normal.
We’ve asked the government for more details about the rebate and will update when we hear back
The £200 rebate is designed to soften the blow of bills rising from the price cap increase in April.
But hard-up Brits will have to wait until October when the cap could increase again, and they will have to pay the money back later on.
Around 15million households will also get a £150 council tax discount if they are in bands A to D – and that won’t need to be repaid.
And more people will be eligible for the warm home discount, Mr Sunak also said.
The help will benefit around 28million households, the Chancellor said, offering an average saving of £350.
But households will still face energy bills that are hundreds of pounds more than they are now.
The increase also comes a the same time National Insurance rates will increase for millions of Brits.
Boris Johnson and Rishi Sunak last week vowed to plough on with plans increase the tax – after the Prime Minister came under pressure to scrap the the hike.
Inflation is also rising putting pressure on budgets. It hit 5.4% in January, a 30-year-high, and could even hit 7% this year
High inflation means that the price of things like food are increasing and if you don’t earn more to cover the cost then it could leave you worse off.
Rocketing energy bills have seen hard up Brits face a choice of eating or heating their homes.
What help can I get with my energy bills?
On top of the £200 energy bill rebate announced today, there’s other help you can get if you’re struggling with energy bills.
In the first instance it’s best to speak to your supplier directly if you are struggling to pay your bill or are worried about falling behind.
It’s best to do this sooner rather than later as failed direct debit payments could cost you extra and affect your credit score.
Many suppliers run their own schemes offering help, or have charitable trusts to help pay arrears.
British Gas Energy Trust, for example, runs a scheme where anyone can apply for a grant, and you don’t even have to be a customer.
Other firms that offer grants just to their customers include:
Your local council may also be able to help with cash and grants if you are struggling with bills through the Household Support Scheme
The winter fuel payment scheme, where those getting the state pension can get between £100 and £300 to offset the cost of keeping their homes warm.
Low income households can get £25 a week to help with energy bills during the winter thanks to the cold weather payment scheme too.
The warm home discount scheme means you can a £140 payment that goes toward your heating costs – but you need to act quick as this scheme has already closed at most energy suppliers.
You could be eligible for a budgeting loan if you’ve been on certain benefits for six months.
But while this can help cover some costs like if your boiler breaks down and you need to replace it, or you need to buy new energy appliances, like a washing machine or tumble dryer, you will need to pay the money back.
So check the other non-repayable help you could get first.
If you’re worried about paying bills, falling behind or are in debt, there are plenty of organisations where you can seek advice for free, including:
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