More financial support for households has been pledged by the government ahead of an expected further rise in energy prices this autumn.
In efforts to reduce the cost-of-living crisis caused by rising energy prices, the Chancellor announced today that the most vulnerable households across the UK will receive support of at least £1,200 this year, including a new one-off £650 cost of living payment.
Universal support increased to £400, as the government doubled its October discount on energy bills and scrapped the requirement to repay it.
A new temporary Energy Profits Levy on oil and gas firms was also announced, to raise around £5 billion over the next year.
Chancellor Rishi Sunak said: “It is also right that those companies making extraordinary profits on the back of record global oil and gas prices contribute towards this. That is why I’m introducing a temporary Energy Profits Levy to help pay for this unprecedented support in a way that promotes investment.”
After the lifeline was announced, Mike Foster, CEO of not-for-profit trade association the Energy and Utilities Alliance, said it is time for the government to make some long-term policy decisions too.
He said: “We welcome the announcement from the Chancellor on the grants for households that finally provide a lifeline to those struggling with the elevated cost of energy bills. This type of short- term measure is a vital step in protecting the most vulnerable in our society from falling into fuel poverty as the energy market remains turbulent in the approach to another Price Cap rise in October.
“Now, the government needs to look at the long-term protection of the British people and their financial situation in the face of rising energy costs by urgently shifting away from fossil fuel gas to hydrogen, using the world-class gas networks already underground to supply our homes and businesses. This will create more secure energy supply to homes breaking free from the blood-stained hands of President Putin, and positioning the UK as the world’s leading hydrogen economy.”
Kevin Wellman, CEO of the Chartered Institute of Plumbing and Heating Engineering (CIPHE) added: “There is no doubt this is a dire situation. We welcome the targeted nature of the support to help the most vulnerable households and the scrapping of the controversial £200 loan for energy bills. However, the number of fuel poor has doubled since April, going hand in hand with water poverty rates. Even with these new measures, soaring inflation and cost of living crisis will still see millions more households fall into fuel and water poverty this year.
“The CIPHE cannot emphasise more the vital role installers play in helping their customers get the best efficiencies out of their heating and plumbing systems. From ensuring boiler settings aid efficient use, to upgrading controls, or fixing dripping taps, saving water and energy is all in a day’s work. Never assume that clients are aware how their systems work, or the importance of energy saving devices such as Thermostatic Radiator Valves (TRVs) and controls. A five minute chat about saving energy and water efficiency could help save hundreds on bills.”