Households to receive £400 energy bills discount - how does it work?

29 July 2022, 06:05

All households in England, Scotland and Wales will receive £400 in energy bill discounts from October, the Government has announced.

The support will be issued in six instalments over six months to some 29 million households.

How does it work?

Those with a domestic electricity meter point paying for their energy via standard credit, payment card and direct debit will receive an automatic deduction to their bills.

Traditional prepayment meter customers will be provided with Energy Bill discount vouchers in the first week of each month, issued via SMS text, email or post.

Business and Energy Secretary Kwasi Kwarteng said: "People across the country are understandably worried about the global rise in energy costs, and the pressure this is placing on everyday bills.

"While no government can control global gas prices, we have a responsibility to step in where we can and this significant £400 discount on energy bills we're providing will go some way to help millions of families over the colder months."

Chancellor Nadhim Zahawi said the discount was "part of our £37 billion of help for households, including 8 million of the most vulnerable households receiving £1,200 of direct support to help with the cost of living".

The announcement comes after Consumer champion Martin Lewis said the Prime Minister and Tory leadership contenders Liz Truss and Rishi Sunak needed to agree a package to help consumers.

He said Boris Johnson's "zombie government" was failing to address the crisis caused by rising energy bills and warned decisions on support cannot be delayed until Mr Johnson's successor is in office.

Money Saving Expert's Mr Lewis said households will start receiving notice of increased bills before the Tory leadership contest concludes, ahead of the energy price cap rising to £3,500 or more in October.