MSE News: Households to get £400 boost to help with rising energy bills

Mstty

rangout said:

What about renters on a service charge?

My Housing Association pays the energy bills for the building, and the tenants pay them a set monthly charge. I take it people like that aren't eligible?

For the previous scheme that was the £200 loan they were going to look at situations like yours and for others that say live on caravan park homes. So perhaps there is hope?

stamford5957

MoJo said:

Is the grant paid to the account with the supplier or to bank accounts? 

I'm confused.... my gas is supplied by British Gas (billed quarterly) and electric with eon-Now (billed monthly) and I pay my bills online when they are due with my debit card so not by direct debit.  So how will I receive this energy rebate and how is it divided between these two companies?

GingerTim

stamford5957 said:

MoJo said:

Is the grant paid to the account with the supplier or to bank accounts? 

I'm confused.... my gas is supplied by British Gas (billed quarterly) and electric with eon-Now (billed monthly) and I pay my bills as they come in with my debit card so not by direct debit.  So how will I receive this energy rebate and how is it divided between these two companies?

You will have a £400 credit applied to your electricity bill, nothing to your gas bill.

[Deleted User]

Just looking at what molerat posted:

All the details of how the payments will be made / split and eligibility here

https://www.gov.uk/government/publications/cost-of-living-support/cost-of-living-support-factsheet-26-may-2022

I had a look at these and looks like my MIL and FIL (both pensioners in their 80s) will be receiving alot of help this winter

As they are on Pension Credit benefit:  + £650 (2 cost of living payments made in July and Autumn)
Winter Fuel Payment (for pensioners) + £600 (paid in Winter an increase of £300 on what they got last year)
(Univeral) Energy Discount Grant + £400 (presumably added to energy account balance)
Warm Home Discount + £150 (added to energy account balance)

Last year they received £440 in help (winter Fuel and WHD payments) and this coming year looks like they will get £1700 help - an additional £1260 above what they received last winter?  Am I correct to assume that they are entitled to both the £650 benefit AND the Winter Fuel Payment (£600)?  

That is the way I read it for their case


 

 

OrwellianBabe

So from October, everyone's energy bill will be reduced by £400.  However, this reduction could be cancelled out if the Energy Companies increase the standing charge again in the autumn which no doubt they'll take the opportunity to do. My thoughts are that even if wholesale prices were to unexpectedly drop down at this time, no doubt the energy companies will be seeking ways to recoup any ‘windfall tax or market standardisation charges’ they may be expected to pay out.  So whatever the Chancellor is giving us in one hand, will be taken away by others with little overall net benefit. I suspect this will be the same scenario as drops in wholesale oil costs or increases in the base rate for savers – it won’t be passed on!  This 'gift' may not necessarily be the answer to our prayers but I guess at least it's better than no help at all.

MattMattMattUK

OrwellianBabe said:

So from October, everyone's energy bill will be reduced by £400.  However, this reduction could be cancelled out if the Energy Companies increase the standing charge again in the autumn which no doubt they'll take the opportunity to do. 

It will not be, the standing charge is unlikely to rise by any significant amount in October, somewhere in the range of 2-5p is the expected rise on electricity and 1-3p on gas. 

OrwellianBabe said:

My thoughts are that even if wholesale prices were to unexpectedly drop down at this time, no doubt the energy companies will be seeking ways to recoup any ‘windfall tax or market standardisation charges’ they may be expected to pay out. 

Energy suppliers will not be subject to the windfall tax because they are not making any profit, the windfall tax will be on energy producers and as it raises their tax rate to 65% none of them will make a significant profit for the next three years, they will invest and conduct share buybacks. 

OrwellianBabe said:

So whatever the Chancellor is giving us in one hand, will be taken away by others with little overall net benefit. I suspect this will be the same scenario as drops in wholesale oil costs or increases in the base rate for savers – it won’t be passed on!  This 'gift' may not necessarily be the answer to our prayers but I guess at least it's better than no help at all.

The payments are not designed to make people better off than they would have been last year, they are designed to cushion the impact of the global energy price rises on the public, the aim of them is at best to put people in a neutral position, but for most they will only slightly cushion them against the impact of the rises. 

[Deleted User]

OrwellianBabe said:

So from October, everyone's energy bill will be reduced by £400.  However, this reduction could be cancelled out if the Energy Companies increase the standing charge again in the autumn which no doubt they'll take the opportunity to do. My thoughts are that even if wholesale prices were to unexpectedly drop down at this time, no doubt the energy companies will be seeking ways to recoup any ‘windfall tax or market standardisation charges’ they may be expected to pay out.  So whatever the Chancellor is giving us in one hand, will be taken away by others with little overall net benefit. I suspect this will be the same scenario as drops in wholesale oil costs or increases in the base rate for savers – it won’t be passed on!  This 'gift' may not necessarily be the answer to our prayers but I guess at least it's better than no help at all.

Ofgem have already stated that the cap is likely to rise to £2800 for their average user.  I wasn't expecting the £400 to cancel out the expected 42% increase in the cap.

I'm glad that the burden has been slightly eased for my situation (I'm only getting relief of £400).  Would have loved it to be more but was not expecting the government to have done as much as they announced today.  As you rightly say it is better than nothing and the measures appear to be skewed towards those that really need it the most.

GingerTim

Suppliers can't just unilaterally decide to increase their standing charges.

t0rt0ise

OrwellianBabe said:

So from October, everyone's energy bill will be reduced by £400.  However, this reduction could be cancelled out if the Energy Companies increase the standing charge again in the autumn which no doubt they'll take the opportunity to do. My thoughts are that even if wholesale prices were to unexpectedly drop down at this time, no doubt the energy companies will be seeking ways to recoup any ‘windfall tax or market standardisation charges’ they may be expected to pay out.  So whatever the Chancellor is giving us in one hand, will be taken away by others with little overall net benefit. I suspect this will be the same scenario as drops in wholesale oil costs or increases in the base rate for savers – it won’t be passed on!  This 'gift' may not necessarily be the answer to our prayers but I guess at least it's better than no help at all.

We are being given this money in order to pay our energy bills so it is right that it gets spent as soon as we get it. 

Mstty

It is certainly welcome here after moving from 14p kWh for elec to 29.24p kWh our annual kWh usage meant we were looking at £2094 for the year and now it's £1694.