Planned financial help for the rising cost in energy bills

The recent changes in government have left a lot of people wondering where they stand with the promised support with energy bills. We now know that the £400 to support households will still be going ahead. In addition, typical household bills will be capped at £2,500 to prevent households from paying above the odds.

How will the energy prices be frozen?

On Thursday, 8 September 2022, the new Prime Minister, Liz Truss, announced that the government will be giving extra support to households through the Government Price Guarantee Scheme (GPG). This Government grant will be to reduce and cap both gas and electric energy prices at £2,500.

Martin Lewis the MoneySavingExpert founder has shared the figures for the new ‘price average direct debit rates’ which will stand at:

46.36p per day for electricity unit rate 34.00p per kWh
28.49p per day for gas, Unit rate 10.30p per kWh

But he emphasised that these figures are set regionally and some people might have a slightly higher VAT percentage.

The new ‘Energy Price Guarantee’ will come into effect from 1 October, meaning typical households will not pay more than £2500 per year for the next two years. If you want to get a more precise idea of what your bills could look like, the MoneySavingExpert website has a handy calculator to help.

Energy companies will apply this cap to customers’ energy bills. The £400 from the Government will be applied automatically to both fixed and variable tariffs.