Government announces price cap increase and financial assistance

Today OFGEM announced that the energy price cap would be increasing by an eye-watering 54% in April 2022, taking the average household energy bill from £1,277/year to £1,971/year (or from £1,309/year to £2,017/year for prepayment meter users). To help lessen the impact of this unprecedented rise, the UK Government also announced a suite of financial measures:

  • £200 “discount” on bills per household (which is actually a loan to be paid back over 5 years)
  • £150 Council Tax rebate for bands A-D
  • A £150m fund for local authorities to provide further assistance
  • An increase in the number of households eligible for the Warm Home Discount

Even for households who are able to take full advantage of all the forms of assistance, this will not bridge the £694 gap, especially when you consider that the £200 “discount” will in fact have to be paid back in future years. This is at a time when families in fuel poverty are already reeling from the previous price cap increase as well as a steep rise in other costs, such as basic food products, and a reduction in Universal Credit.

Our advisers at York Energy Advice have met several York families who are already having to choose between heating and eating; these latest increases will be a huge blow to them, and put them in an incredibly precarious financial position. We demand that the government do more to help families in fuel poverty:

  • Increase the discount for low-income families and individuals, and do not make them pay it back later
  • Give better-off people the option to refuse the discount, leaving more money for others
  • From now on, increase the Warm Home Discount in line with price cap increases, rather than keeping it frozen at £140
  • Commit to a mass rollout of insulation measures for people on low incomes in addition to the existing ECO and Green Homes Grant schemes, and with more lenient EPC eligibility criteria
  • Encourage energy companies to write off debt for customers in financial hardship

If any York residents are struggling with their bills or worried about how the price cap increase will affect them, please don’t suffer in silence: we may be able to help you access extra financial assistance, supply you with energy saving measures or give you advice on how to reduce your energy usage. Give us a call on 01904 922249 or fill in the referral form and we will get back to you. Similarly, if you know anyone in York who might be struggling, please do fill in a referral form on their behalf.