Ask Jonathan... about the energy price cap increase
Our Marketing and Communications Officer Natalie spoke to our Sustainability and Environment Manager Jonathan Newton about what the energy price cap increase actually means for us all and what support we can offer.
Q: What does the energy price cap mean?
A: The energy price cap which is the maximum price suppliers in England, Wales and Scotland can charge households is being raised by 54% on 1 April.
Under the new cap, the rates on average (it varies by region) are about 7p/kWh for gas, with a standing charge of 27p per day. For electricity, it's about 28p/kWh, with a standing charge of 45p per day.
This means households on standard tariffs will see an average increase of £693 - from £1,277 to £1,971 per year, and prepayment customers will see an average increase of £708 - from £1,309 to £2,017.
The price cap sets a limit on the rates you pay for each unit of gas and electricity, so if you use more, you'll pay more.
You'll be on a standard tariff if you've never switched, your fixed deal ended and you didn't switch again, or if your provider went bust and you were moved across to a new supplier. Energy bills won't rise immediately for people on fixed rates, but many are likely to see a significant increase when their deal ends.
Q: Should we be switching tariffs?
A: Contrary to the advice we have received for many years that you need to switch energy tariffs to get the best deal, it is highly likely that remaining on your energy company's standard tariff once any fixed deal ends is the best decision. Suppliers are making a loss on everyone on price-capped tariffs and having to sell energy under cost price, so they are trying to get people on to more expensive fixed deals.
Q: What support is there?
A: The Government has released some measures to help with the increased costs including:
- Council tax rebate - In April people in council tax bands, A to D in England will receive a one-off £150 discount. You can check what band you are in on the government website www.gov.uk/council-tax-bands. You won't have to apply for the discount as your local authority will automatically recognise if you qualify.
- £200 energy bill rebate - In October customers will receive a £200 rebate on their energy bills. They will have to repay this at £40 a year for five years, starting in April 2023 likely as an increase to standing charges.
- £144 million of discretionary funding will be given to local authorities to support households who need support but are not eligible for the Council Tax Rebate.
- The Warm Home Discount scheme will be expanded to cover three million households. It offers low-income households a one-off annual discount on their electricity bill and was worth £140 in 2021/22.
Household Support Fund
The Household Support Fund is provided by the Department for Work and Pensions to support those most in need this winter during the final stages of economic recovery. The fund runs until 31 March 2022.
This fund can be used to help towards the cost of:
- Energy / water needs
- Essentials linked to energy and water needs i.e., clothing, white goods
- Wider essentials, where appropriate, such as housing costs and other essential bills.
Lancashire County Council is administrating this fund across Lancashire, working with District Councils and partners to support those most in need. For more information read here: Household Support Fund - Lancashire County Council
Fylde Borough Council - www.fylde.gov.uk/householdsupportgrant
Preston City Council - Household Support Fund - Preston City Council
Wyre Council - Support for low income households over winter – Wyre Council
Chorley Council - Chorley Council Debt and Money Advice
South Ribble Council – As this funding is allocated to South Ribble residents in need of financial support, you may be asked to provide supporting documentation such as proof of income, or receive a home visit to survey your needs.
You do not need to be in receipt of benefits to access this support, but funding is targeted to those who are struggling financially.
South Ribble Council is working with Citizens Advice Bureau to offer people financial support with gas, electricity and water costs.
You can complete this form to register with them: Citizens Advice - Household Support Fund
Other requests are considered on a case by case basis, but South Ribble Council can help with other essentials such as white goods, furniture, Leyland Market vouchers, carpets and school uniform. Email: email@example.com
Q: What is Progress Housing Group, as my landlord, doing to support us?
A: Although our properties are more energy-efficient than the national average, we have set stretching decarbonisation goals through our environmental sustainability strategy, and in the shorter term, we are working across the business to identify those most at risk and provide targeted energy advice and assistance.
On a more personal level, we are committed to supporting you through any financial difficulties and our specialist teams are here to provide guidance on claiming benefits.
If you do need help, please contact us on 03333 204555, email firstname.lastname@example.org or via live chat on our website between 8am and 5pm Monday to Friday.
There are also a wealth of other resources out there to help you, which can be found here: /support-wellbeing/community-support-and-useful-resources/
The Citizens Advice Bureau also offers free energy advice and support: Get free energy advice and support - Citizens Advice
Q: Is there anything we can do as tenants?
A: There are many ways we can also reduce our energy usage by making simple changes to our homes and habits which could help offset the current price rises. The energy savings trust has a lot of good advice in this area energysavingtrust.org.uk/energy-at-home/