£400 energy discount. What if you spend less than that?

Streaky_Bacon

Hi,

Does anybody know how the £400 energy discount works, if you don't actually use £400 of energy in the 6 months from Oct 2022?

As I understand it, there will be 6 payments over that 6 month period, but I cannot see anything which mentions what happens if you don't use that much energy.

If, for example, your bill was only £10/month during that 6 month period, do you only get £60 off, or do you get £60 off, plus £340 of credit.

On my main residence, it is irrelevant, but I also have a flat that I only use when in that part of the country, which may well use less than £400.

Also, if the property is dual fuel with different providers, is the discount split as £200 from each provider?

Any thoughts would be very appreciated.

Spoonie_Turtle

Streaky_Bacon said:

Hi,

Does anybody know how the £400 energy discount works, if you don't actually use £400 of energy in the 6 months from Oct 2022?

As I understand it, there will be 6 payments over that 6 month period, but I cannot see anything which mentions what happens if you don't use that much energy.

If, for example, your bill was only £10/month during that 6 month period, do you only get £60 off, or do you get £60 off, plus £340 of credit.

On my main residence, it is irrelevant, but I also have a flat that I only use when in that part of the country, which may well use less than £400.

Also, if the property is dual fuel with different providers, is the discount split as £200 from each provider?

Any thoughts would be very appreciated.

The credit is for domestic electricity supplies so it will apply to your account with your electricity supplier.

We done't yet know for sure exactly how it will be applied, whether 6 equal discounts or a whole £400 credit at once, but logically even if you are given a discount on a bill that's lower than the discount, the bill will be negative which means you're in credit anyway. 

I really don't see the suppliers would be able to get away with not giving the equivalent of the full £400 by only discounting a reduced amount for small bills.

Sea_Shell

AIUI if you don't use all the credit, it will just sit there and would get used up... eventually.  

In the shorter term, it will probably depend on whether your provider will allow you to reduce your DD (bill) right down (to nothing?) or refund you a lump sum if asked. 

I'm sure we'll hear all sorts of difference stories come October as to how accommodating each supplier is at helping people manage this credit.

Non-dual fuel customers, who are struggling with heating over winter, will probably want a facility to somehow "move" that credit onto their gas account, by way of adjusted DD's (down for E, up for G) or a cash refund.

wild666

I certainly know if it's done in 6 payments I will be lucky if I use £66.66 per month, I will also get the £150 disability payment so that's equivalent to £91.66 per month so there will be a very large chunk of the money sitting in my account as credit. 
What I would object too is if people can take the £400, or more, out of their account if they don't use the then try and claim they cannot afford their electric and gas bills. This money shouldn't be able to be taken out of the account when its paid either as one lump sum or by 6 monthly installments.

Sea_Shell

wild666 said:

I certainly know if it's done in 6 payments I will be lucky if I use £66.66 per month, I will also get the £150 disability payment so that's equivalent to £91.66 per month so there will be a very large chunk of the money sitting in my account as credit. 
What I would object too is if people can take the £400, or more, out of their account if they don't use the then try and claim they cannot afford their electric and gas bills. This money shouldn't be able to be taken out of the account when its paid either as one lump sum or by 6 monthly installments.

I agree to a certain extent, but that would be hard to police, especially if people really need to be able to access credit on their E account to help pay for their G, if not dual fuel.    Will suppliers work together to resolve this...unlikely!!

It's also going to rely on suppliers being happy to reduce customers E DD's to reflect the credit, promptly, not just dig their heels in and refuse to review peoples winter DD's.

Mstty

@wild666

I can't see Ofgem re writing the credit of account rules for this one off grant.

Also it is a grant for cost of living so I doubt any restrictions will apply as you could take it out to pay for fuel for a car or shopping or another utility or energy such as oil.

Alnat1

I think it will depend on which company you are with. Those that are efficient and do monthly billing and DD adjustments might let you withdraw it, while those that only issue bills every 6 months might not.

Spoonie_Turtle

wild666 said:

I certainly know if it's done in 6 payments I will be lucky if I use £66.66 per month, I will also get the £150 disability payment so that's equivalent to £91.66 per month so there will be a very large chunk of the money sitting in my account as credit. 
What I would object too is if people can take the £400, or more, out of their account if they don't use the then try and claim they cannot afford their electric and gas bills. This money shouldn't be able to be taken out of the account when its paid either as one lump sum or by 6 monthly installments.

The £150 is a general Cost of Living payment, paid by the government directly to you.  Only the £400 goes to energy accounts.

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

Ultrasonic

So far I've seen nothing to suggest that the money has to be used within a particular time-frame.

Mstty

With current Standing charges it could just sit there for 2 and a half years paying that

johnbhoy70

Sea_Shell said:

wild666 said:

I certainly know if it's done in 6 payments I will be lucky if I use £66.66 per month, I will also get the £150 disability payment so that's equivalent to £91.66 per month so there will be a very large chunk of the money sitting in my account as credit. 
What I would object too is if people can take the £400, or more, out of their account if they don't use the then try and claim they cannot afford their electric and gas bills. This money shouldn't be able to be taken out of the account when its paid either as one lump sum or by 6 monthly installments.

I agree to a certain extent, but that would be hard to police, especially if people really need to be able to access credit on their E account to help pay for their G, if not dual fuel.    Will suppliers work together to resolve this...unlikely!!

It's also going to rely on suppliers being happy to reduce customers E DD's to reflect the credit, promptly, not just dig their heels in and refuse to review peoples winter DD's.

Very hard to police!! My mum's not on mains gas and could very well end up with quite a credit balance to be honest. However, electricity is only a part of her energy costs (maybe a third or less) as she has to fill an oil tank for her central heating a couple of times a year and it's not cheap i'm told.