OutFox Energy Announced Energy Government Discount April 1st - slightly lower than predicted

IOWJJBTM2025

I have had an email from Outfox Energy to advise the new rates on my fixed tariff from April 1st which show the discount to be applied due to the Government discount.

Previously the predicted discount on the MSE website and also from Martin Lewis on his TV program advised that the predicted discount on the unit price should be 3.54p / kWh Electricity, 0.33p / kWh Gas.

The OFGEM 'typical user' (2700kWh per year Electric / 11500kWh per year Gas) was going to save £133.53 per year.

Outfox discount is 23% Lower:- 3.024p / kWh Electricity, 0.179p / kWh Gas - see below.

Therefore the OFGEM 'typical user' (2700kWh per year Electric / 11500kWh per year Gas) will be saving £102.23 per year.

This is £31.29 than predicted for the 'Typical User'

Would be interesting to compare other suppliers if they give the same discount?

Netexporter

Prices vary by region, so the government figure will be based on an average of all the regions.

QrizB

Outfox have a thread re. the changes here:

https://forums.moneysavingexpert.com/discussion/6660043/outfox-not-following-price-cap-changes-april-1st

IOWJJBTM2025

https://forums.moneysavingexpert.com/discussion/comment/81941808#Comment_81941808

Thanks - I did have a search and could not find anything concrete other than speculation. This aligns with the email I got. The question asked by MSE was will you pass on the savings and almost all suppliers agreed that they would.

We now find that the Outfox discount is 23% less than expected. I would be very interested if other suppliers will follow Outfox calculations.

Maybe this is something that the MSE team can champion as to why the £150 saving for the typical user which was rounded up from £133.53, now works out to be £102.23. I saw on the news several times the Prime Minister and Ed Milliband shouting about the £150 saving for the typical user which is now actually £102

Ildhund

@IOWJJBTM2025 wrote:

… the £150 saving for the typical user […] was rounded up from £133.53,

It wasn't. DESNZ took Ofgem's November estimate of the total amount to be deducted from all domestic electricity bills and divided by ONS's best guess at the number of households¹. That's where the mythical £150 came from (it was actually about £154, so they docked a bit so as not to appear greedy). The 'typical' household is an Ofgem artefact, whose consumption is greater than the lowest 50%². This "Typical Domestic Consumption Value" is quite a bit lower than the average, which goes a long way to explaining where the £133.53 came from. The November estimate was revised down a bit in February, and the detailed figures are all given in Ofgem's mammoth Annex 4 spreadsheet if you want to check for yourself³.

1. Budget_2025_-_Data_Sources.pdf (foot of p. 25)
2. Decision on revised Typical Domestic Consumption Values for gas and electricity and Economy 7 consumption split (footnote 2 on p. 4)
3. https://www.ofgem.gov.uk/sites/default/files/2026-02/Annex-4-policy-cost-allowance-methodology-v1.23.xlsx (good luck with unravelling that)

IOWJJBTM2025

@Ildhund Thanks for the info. Just had a read through and from what I could easily extract is that the typical user that I had assumed was used to calculate should have been the benchmark consumption.

Typical User is 2700kWh per year Electric / 11500kWh per year Gas

Benchmark Consumption is (for single rate electric user) is 3100 kWh per year Electric / 12000kWh Gas.

For multi rate electricity users the benchmark consumption for electric is 4200kWh instead of 3100kWh.

Am unsure about how multi rate user discounts would be calculated and MSE did not offer any suggestions for this.

By inserting the new benchmark consumption into the MSE suggested discounts of 3.54p Elec / 0.33p Gas it actually adds up to a saving for the benchmark user of £149.34 per year discount.

By inserting the new benchmark consumption into Outfox Energy discount of 3.024p Elec / 0.179p gas it works out at a saving for the benchmark user of £115.22 per year.

By my reckoning Outfox have kept £34 per customer. Do we know yet if this is the same discount values for all suppliers?

I realise that the government have pushed this discount to be given onto energy users onto the energy suppliers to handle and they will have internal costs to implement.

I have already received an email and anticipate they have to update the billing systems. No doubt Outfox customer services are busy now with numerous people arguing about the discount level given and there is a cost for this.

Is the government paying the suppliers to implement the change or are they expecting them to do it for free. Maybe this could be the reason why Outfox have a lower value?

Ildhund

@IOWJJBTM2025 I'm not sure where you're getting your benchmark consumptions from. The current ones applying in this situation are those given in the TDCV file I referred to earlier. They will probably be revised downwards again later this year. The 'MSE suggested discounts' are the ones based on November's estimates; they were revised down a bit in February as I mentioned. For example, the 3.54 p/kWh suggestion is probably nearer to 3.51 p/kWh now.

I've no idea how suppliers are supposed to handle this unprecedented change, or whether they'll receive any compensation for all the extra work it clearly entails. Perhaps Outfox have decided to charge customers a bit for this work, hoping not to be hauled over the coals for it by Ofgem after the fact.

MWT

https://forums.moneysavingexpert.com/discussion/comment/81942962#Comment_81942962

For example, the 3.54 p/kWh suggestion is probably nearer to 3.51 p/kWh now.

… and that is the figure that Octopus are using for the reductions applied to their fixed tariffs…

superkoopauk

The official supplier guidance is here. Section 3 indicates the discounts for a fixed tariff active before the 1st April should be 2.45 RO plus 0.89 ECO = 3.34 ppkWh and 0.31 (ECO) ppkWh for gas. So on the face of it outfox are not discounting fully.

https://www.gov.uk/government/publications/domestic-energy-tariff-reductions-2026-guidance-for-energy-suppliers/ro-to-exchequer-and-eco-costs-schemes-guidance-for-suppliers-html#applying-the-discount

Ildhund

https://forums.moneysavingexpert.com/discussion/comment/81943147#Comment_81943147

Thanks. The guidance was published on 18 March, so I must have been a bit previous when investigating this. Not all readers will notice the differences (e.g. 3.34 p/kWh > 3.51 p/kWh) between ex VAT values and those including VAT.

I wondered whether there would be any compensation for their extra work in implementing the change. The guidance is brutally clear:

6.3 Funding will not be provided to suppliers for scheme administration.

kaMelo

I sent an email questioning their reductions and this is the response I got.

The average reduction from the policy changes (ending the Energy Company Obligation/ECO and reducing the Renewables Obligation/RO) amounts to approximately £150 per year for many households, which is passed on as lower unit rates.

Yes, the figures (roughly 3.34p for electricity and 0.31p for gas) appear to represent the per kWh cost reduction of removing these levies (RO and Eco) from bills. These changes are part of a 7% reduction in the total energy price cap starting 1 April 2026.

The official government announcement mentions "an average of £150 off the costs of energy bills" rather than a guaranteed flat p/kWh reduction for every consumer, as the final unit rates depend on the supplier and region.

So the rates we have provided (inclusive of the VAT are correct)

Apart from the fact I didn't mention £150 anywhere (only ever talked about unit rates) I'm confused about the last part of their response "the final unit rates depend on the supplier and region" Is that correct or just a fob off?