The Government says its new energy support package will save households between £650 and £1,400 on what they could have faced had the planned October price cap gone ahead.
New UK Prime Minister Liz Truss announced her new strategy on energy prices on Thursday which included two-year energy price guarantee for households from October 1. She confirmed the Ofgem price cap will be scrapped in favour of a “two year energy price guarantee”.
The announcement means that energy bills will be frozen at £2,500 for two years in the run-up to the next general election as families battle the cost-of-living crisis. The energy price cap had been due to rise to £3,549 per year from October 1, Ofgem confirmed in late August.
However, the new package of measures mean energy bills will be frozen at the previous rate of £2,500.
The Government says the consumer saving will be based on usage, but a typical household will save at least £1,000 a year
As part of its package of measures, the £400 Energy Bills Support Scheme will still go ahead and will be paid in 6 instalments from October. The Government said the most vulnerable UK households will also continue to receive £1,200 of support provided in instalments over the year.
A Government spokesperson added: "An additional discretionary fund will be available for those households who are outside of the schemes. For example, households not on standard gas / electricity contracts."
| Property type | Under October price cap | Under government Energy Price Guarantee | Difference |
|---|---|---|---|
| All dwellings | £3,550 | £2,500 | £1,050 |
| Houses | £3,800 | £2,650 | £1,150 |
| Detached | £4,700 | £3,300 | £1,400 |
| Semi Detached | £3,800 | £2,650 | £1,150 |
| End Terraced | £3,500 | £2,450 | £1,050 |
| Mid Terraced | £3,300 | £2,350 | £950 |
| Bungalow | £3,500 | £2,450 | £1,050 |
| Flats | £2,450 | £1,750 | £700 |
| Converted flat | £2,750 | £1,950 | £800 |
| Purpose built flat | £2,400 | £1,750 | £650 |
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