Prime Minister Liz Truss has frozen energy bills at around £2,500 a year for most households under plans announced yesterday.
The new Prime Minister has said households on the Ofgem energy price cap will have their bills frozen.
The scheme is called the 'energy price guarantee'.
It means a planned October price cap rise which would see average yearly energy bills hit £3,549 has been avoided.
But many consumers have been asking if the new Government energy bill bailout means they will still get a £400 discount to their gas and electricity bills.
Earlier this year the former chancellor Rishi Sunak announced £400 support for every household in the country in an attempt to alleviate the cost-of-living crisis.
This £400 payment is still being made, and will be taken off the £2,500 figure unveiled by the Prime Minister - putting the average bill this year at around £2,100.
But the Government has given no commitment to repeating the support next year, meaning consumers will likely have to find an extra £400 towards 2023 energy bills.
Government officials believe your bills will work out at £3,300 a year for the average detached house.
That falls to £2,650 for semi-detached, £2,450 for end-of-terraces, £2,350 for mid-terraces, £2,450 for bungalows.
For converted flats the average is expected to be £1,950 and for purpose-built flats it’s set to be £1,750.
A £500,000 home in London is generally a flat whereas a £500,000 home in the north east can be detached and have several bedrooms.
This means generally poorer people in larger, northern, colder homes will pay more than those in flats in the south. The north of England is also, of course, colder.
People on pre-paid meters will have their bills capped too but still pay more than someone paying by direct debit.
Paying by direct debit is already cheaper for households as it costs less for firms to bill users for their energy.
Essentially, it's more effort for suppliers to charge people using a pay as you go system, who tend to be poorer than direct debit customers.
The Government is changing the fixed unit price for energy for everyone under the new plans, so you are billed per unit of gas or electricity you use.
Energy bills will be capped for two years - though plans are still being drawn up to help some customers, for example those on fixed-rate deals.
The Ofgem price cap only applies to people on variable rate energy deals - around 80% of the country, or 24million people.
But many energy users have recently locked in to fixed rate deals and may not benefit from any price cap freeze.
This price cap was due to rise to £3,549 in October.
Because of that, up to 15% of households have taken out fixed rate deals higher than the current price cap, thinking it would save them money in the long run.
The Government has yet to formally address if those on fixed deals will be allowed to leave without paying a penalty.
However, MoneySavingExpert founder Martin Lewis has claimed this would be the case.
He said: "Those on fixes can either stay on them or can leave and switch to the new state-subsidised tariffs with no exit penalties."
If you fixed within the last 14 days, you can cancel without charge.
Lewis added: "I'm hearing fixed tariffs will have the same unit rate reduction as variable tariffs (ie roughly 30% off). So it looks like, unless you fixed at over the new Oct price cap level, your fix will be cheaper than moving to variable."
He added that he was checking the details of this.
Writing on MoneySavingExpert later, Lewis added: "Earlier, the information I was told by the Government was that "all can get out of a fixed tariff without exit penalties". This may have changed, so that it is left up to firms.
"I will confirm when I know, but be careful acting on any of this before it is cast iron."
