UK government has introduced its Energy Prices Bill, putting into law support to help businesses and others with energy costs this winter.
The Bill also includes powers to stop volatile and high gas prices dictating the cost of electricity produced by cheaper renewables.
Government says consumers will pay a fairer price for their electricity as new emergency powers are introduced to ensure consumers across the country receive help with their energy bills this winter.
Without the launch of the schemes, businesses and consumers had been left facing increasing financial turmoil, with energy bills estimated to increase to as high as £6,500. Recently announced support will see a typical household pay £2,500 a year for energy, while businesses will be paying less than half of predicted wholesale costs this winter.
The Energy Prices Bill, introduced in Parliament on 12 October 2022, provides the legislative footing needed to ensure that people and businesses across the UK receive support with their energy bills this winter through the Energy Price Guarantee for domestic consumers and Energy Bill Relief Scheme for businesses and non-domestic properties. This includes essential measures that enable the UK government to deliver comparable schemes in Northern Ireland and legislation that will require landlords and heat network operators to pass benefits through to tenants.
The precise mechanics of the temporary Cost-Plus Revenue Limit will be subject to a consultation to be launched shortly.
Energy Prices Bill
The Bill will introduce powers to enable the following:
Energy Bill Relief Scheme: This will enable the government to provide financial assistance on energy bills for all eligible non-domestic customers, including businesses, charities and public sector organisations. This took effect on 1 October 2022.
Energy Price Guarantee: The Energy Price Guarantee will ensure that a typical household in the United Kingdom pays around £2,500 a year on their energy bill, depending on their use, for the next two years, from 1 October 2022.
Alternative Fuel Payment: This scheme is intended to deliver a one-off payment of £100 to UK households who are not on the mains gas grid and therefore use alternative fuels, such as heating oil, to heat their homes. More detail on non-domestic consumers will be set out shortly.
Northern Ireland Energy Bills Support Scheme: Powers in the Bill will provide a basis to allow the government to make payments and deliver NI EBSS, which will provide £400 of support to households in Northern Ireland this winter. Powers will enable a similar delivery model to the Energy Bills Support Scheme in Great Britain, in respect of using the existing regulatory regime to enforce and provide assurance to the government on delivery.
Energy Bills Support Scheme Alternative Fund: This scheme is intended to provide the £400 of support for households across the UK that would otherwise miss out on the Energy Bills Support Scheme, as they do not have a domestic electricity contract. The Alternative Funding will be made available for this winter, with an announcement on this in due course. The Bill will provide powers to deliver the funding through local authorities.
Heat network support: Powers in the Bill will ensure that heat networks benefiting from the Energy Bill Relief Scheme pass through cost savings to their consumers. The Bill provides for the appointment of an Alternative Dispute Resolution body which will handle complaints raised by consumers against their heat network if it has not complied with passthrough requirements.
Pass-through requirements on intermediaries: This legislation is intended to ensure support from the Energy Price Guarantee, Energy Bill Support Scheme, or Energy Bill Relief Scheme, are received by the end user in cases where intermediaries procure energy on their behalf in accordance with the terms of regulation. For example, the legislation will require landlords to pass benefits to through tenants with further details of the requirements under this legislation to be set out shortly.