Government Action On Tackling Energy Prices

23rd September 2022

Energy Price Guarantee (EPG) - The EPG will cap the unit price that consumers pay for electricity and gas in Great Britain and Northern Ireland. This will bring the average household bill down to £2,500 per year for a period of two years from October 2022. A typical household is expected to save at least £1,000 a year on energy bills. An additional payment of £100 will be provided to compensate those who are not able to receive support for heating costs through the EPG.

Green Levies - As part of the EPG, the government will temporarily cover environmental and social costs, including green levies, currently included in domestic energy bills for two years.
This will contribute an average £150 saving to the savings provided by the EPG.

Energy Markets Financing Scheme (EMFS) – The £40 billion EMFS, delivered with the Bank of England, will help to address extraordinary liquidity requirements faced by energy firms
from high and volatile energy prices. The scheme will provide a backstop source of additional liquidity to energy firms in otherwise sound financial health to meet extraordinary variation margin calls. The scheme will provide liquidity to firms through a 100% guarantee, delivered via commercial banks and will open to applications from 17 October.

Improving energy efficiency across the UK –
• To make homes cheaper to heat, the government will bring forward legislation to implement new obligations on energy suppliers to help hundreds of thousands of their customers take action to reduce their energy bills, delivering an average saving of around £200 a year. This help will be worth £1 billion over the next three years,
starting from April 2023.

• The government will also imminently open applications for up to £2.1 billion over the next two years to support local authorities, housing associations, schools and hospitals invest in energy efficiency and renewable heating.

Energy Bill Relief Scheme (EBRS) for non-domestic users – A temporary six-month scheme in Great Britain, the EBRS will protect businesses and other non-domestic energy users, including charities and public sector organisations, from rising energy bills this winter by providing a discount on wholesale gas and electricity prices. The government will publish a review into the operation of the scheme in three months to inform decisions on future support
after March 2023, focusing in particular on identifying the most vulnerable non-domestic customers and how to continue assisting them with energy costs. A parallel scheme, based on the same criteria and offering comparable support, but recognising the different market fundamentals, will be established in Northern Ireland.