Rhiannon Philps
Sam Bromley
The cost of energy has skyrocketed over the past couple of years, leaving many people struggling to afford their gas and electricity.
In some good news for consumers, the cost of energy has been falling meaning that the deals offered by energy providers may become more competitive. For example, the return of fixed-rate tariffs may help some customers budget by locking in a set price for each unit of energy they use.
But bills are still significantly higher than they were before 2022, and they are predicted to remain at a similar level throughout 2024.
The government has not announced an extension to the Energy Bills Support Scheme. This was an automatic £400 discount on every household’s energy bills from October 2022 to March 2023. Its removal means that households may not notice much of a saving in winter 2023-24.
If you’re struggling financially and owe money to your energy provider, there may be schemes that you can apply for that help reduce the pressure. You can find out more about the energy bill support available below.
Winter Fuel Payment
The Winter Fuel Payment is a one-off payment from the government that aims to help people who are aged 66 or older with their heating costs in winter. You could receive between £250 and £600, to be paid in November or December.
This sum includes a ‘Pensioner Cost of Living Payment’ of between £150 and £300. This will apply for winter 2023 to 2024. The payment won’t affect your eligibility for other benefits.
Any household with at least one person born on or before 25 September 1957 is eligible for this payment, regardless of income. You will also need to have lived in the UK for at least one day in the ‘qualifying week’, which usually starts on the third Monday in September.
You will get this payment automatically if you receive the State Pension or another benefit (excluding Universal Credit, Child Benefit, Housing Benefit and Council Tax Reduction).
If you don’t qualify for an automatic payment but are eligible to receive the Winter Fuel Payment, you can make a claim by phone or post. Once you’ve submitted a claim for one year, you should receive the payment automatically in the following years unless you move abroad or have deferred your State Pension.
The amount you qualify for will depend on when you were born, whether you get certain benefits, and whether you live with anyone else who qualifies for the Winter Fuel payment. Find out more on Gov.uk’s page on how much you can apply for.
Warm Home Discount Scheme
You could receive £150 from the Warm Home Discount Scheme to cut your electricity bill. Alternatively, if you’re eligible and your supplier provides both gas and electricity, you may get a discount on your gas bill.
The money won’t be paid directly to you, but will be taken off your energy bill as a one-off discount. The scheme usually opens each year in September or October and runs until the end of March the following year.
If you’re on a prepayment meter, your energy supplier will tell you how the discount will be applied. For example, you may receive a top-up voucher you can use for your meter.
The Warm Home Discount Scheme is available in:
- Great Britain to anyone who receives Pension Credit (Guarantee Credit only)
- England and Wales to workers on a low income who have high energy costs
- Scotland to anyone on a low income who qualifies under their energy supplier’s criteria
If you’re eligible for the discount because you receive Guarantee Credit, you should get a letter with more information about when they will make the deduction.
In England and Wales, if you’re on a low income and receive certain qualifying means-tested benefits or tax credits, you should get a letter about the discount.
In Scotland, if you’re on a low income and get certain benefits, you need to apply for the scheme directly through your electricity supplier. Exact details on eligibility will vary between suppliers, which only provide a limited number of discounts, so find out more information directly from your energy company as early as you can.
You can stay up to date by checking on the Gov.uk website or with your energy supplier.
Northern Ireland doesn’t offer the Warm Home Discount Scheme, but it does have the Affordable Warmth Scheme instead.
Cold Weather Payments
You could receive one-off payments when the temperature drops to zero degrees celsius or below for seven consecutive days. This is based on average temperatures in your area. These payments are only available in England, Wales and Northern Ireland.
For every seven-day period when the temperature is below freezing, you could receive £25. This should be paid within 14 working days and will be sent to your bank account automatically.
These payments are available between 1 November and 31 March.
You may be eligible to claim a Cold Weather Payment if you receive one or more of the following benefits:
- Universal Credit
- Pension Credit
- Income Support
- income-based Jobseeker’s Allowance
- income-related Employment and Support Allowance
- Support for Mortgage Interest
However, receiving these benefits won’t necessarily mean you are eligible for a Cold Weather Payment. Find out more about the criteria you need to meet on the Gov.uk website.
You can’t get a Cold Weather Payment in Scotland, but you may be able to get a £50 Winter Heating Payment. This payment has the same eligibility requirements as the Cold Weather Payment, but whether you get paid doesn’t depend on the temperature.
Cost of living support package
Several one-off support measures are available to help those who are struggling to pay for basic necessities, including their energy bills. These include:
- Up to £900 Cost of Living Payment: This is available if you get certain benefits or tax credits and will consist of three payments of £301, £300 and £299. The first payment was paid between 25 April 2023 and 17 May 2023. The second will be paid in autumn 2023 and the third in spring 2024.
- £150 Disability Cost of Living Payment: This was available for people on certain qualifying benefits and was paid in summer 2023.
- £150 or £300 Pensioner Cost of Living Payment: If you qualify for the Winter Fuel Payment, you could receive a £150 or £300 top up on your regular payment.
You can find out more information on whether you are eligible for these payments on the Gov.uk website.
British Gas Energy Trust
The British Gas Energy Trust aims to help householders who are financially disadvantaged and find it difficult to pay their energy bills.
The trust offers grants to help those in fuel poverty and anyone who is finding it hard to pay off their energy debts. To qualify for a grant, you will need to have received professional advice from a local advice centre beforehand. You can find your nearest centre on the British Gas Energy Trust’s website.
To be eligible for a grant from the trust’s Individuals and Families Fund, you will need to:
- be a customer on a prepayment meter living in England, Scotland or Wales (the scheme has closed for those using different payment methods)
- owe money to your energy supplier
- be in or nearly in fuel poverty
- not have received a grant from the trust in the previous two years
- have received professional advice for your financial situation.
You must be applying for the grant to pay off outstanding debts to your current gas or electricity supplier in your home. You don’t need to be a British Gas customer to apply.
When you apply, you will need to provide information, such as your most recent energy bill, details about your debts, your income (including any benefits you receive), and the organisation you went to for professional advice.
The British Gas Energy Trust runs another grant called the British Gas Energy Support Fund, which is only available for British Gas customers. It’s currently closed, but should open again in late 2023.
Your energy supplier
Other energy suppliers, including Octopus Energy, Scottish Power and E.ON, offer grants and support to their customers who are struggling to pay their energy bills. It’s worth seeing what schemes are available as they may be able to clear some, or all, of your debts, which can help you to get back on your feet and focus on improving your financial situation.
Even if you don’t qualify for a grant from your supplier, or your supplier doesn’t offer any schemes, you should still contact them if you’re struggling to pay your bills. Together, you may be able to work out a new payment plan, take a break from payments, or come to some other arrangement to help you pay off any debts and manage your bills.
As a last resort, your supplier may ask you to have a prepayment meter installed if you’re not already using one – though it can’t force you to do this.
Depending on your situation, it may be worth comparing energy tariffs and providers and seeing if you could find a cheaper option elsewhere.
» MORE: Guide to energy tariffs
Fuel Direct Scheme
If you’re receiving benefits and you’re in debt to your energy supplier, you may be able to use the Fuel Direct Scheme, which is also known as ‘third party deductions’.
Through this scheme, you can choose to have your energy payments taken directly from your benefits. You can also pay for other bills, including rent and water, through this scheme. The deductions will cover the outstanding debt you owe as well as your current usage.
This is only an option if you receive one of the following benefits:
- Universal Credit (if you’re not working)
- Income Support
- income-based Jobseeker’s Allowance
- income-related Employment and Support Allowance
- Pension Credit
The amount that is deducted from your benefits to pay your energy supplier will vary. If you’re on Universal Credit, 5% of your benefits will be deducted to pay off your energy bills.
If you receive other benefits, £4.25 a week will go towards paying off your debt each time your benefits are paid.
Only you can ask to pay for your gas and electricity through deductions from your benefits. Think carefully before choosing to pay your energy debt this way and consider seeking professional advice to help you decide whether this is the right option for you.
If you have any debts, whether they’re with your energy provider or someone else, you may qualify for the Debt Respite Scheme, also known as a ‘breathing space’. This can temporarily stop costs building up on your debts, though it’s not a payment holiday. You will need to see a debt adviser to help you determine if this is the right course of action for you.
» MORE: How can debt charities help?
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