The Warm Home Discount scheme is potentially being expanded to help an approximate 280,000 households across Scotland with their energy bills. A consultation was launched this week on the proposed expansion of the scheme to cover an additional 50,000 Scottish homes per year.

On Monday the 9^th of May the government began the consultation on the proposed expansion. The main proposals thus far are for support in Scotland to grow by around £13 million to £49 million per year. This would mean that rebates are provided to an additional 50,000 families in Scotland on top of the 230,000 that already receive payments, as well as boosting cash payments to help meet energy costs from £140 to £150. Most crucially, certainty will be provided to those most in need – with the consultation seeking to see the scheme extended to 2025/26.

There are also proposals for supplier participation thresholds to be lowered, enabling more energy suppliers to participate. This will be seen particularly from 2023 to 2024 onwards, very similar to how the Warm Home Discount scheme currently operates in Wales and England.

For Scotland, the Warm Home Discount will continue to focus support on those in receipt of means-tested benefits such as Universal Credit or Pension Credits. It is hoped that this will focus the rebates towards those on the lowest incomes who need the support the most.

Energy suppliers can also use additional eligibility criteria so long as the criteria identify households at risk of fuel poverty, following approval from Ofgem. It is believed that these changes will allow the Warm Home Discount scheme to continue to support low income and vulnerable households across the UK with the incredible rise in cost of living, acting alongside a £22 billion support package that includes a £200 energy bill discount from October.

What is Fuel Poverty?

Anybody who spends 10% of their household income or more on heating their home (after tax and housing costs have been deducted) is considered to be in Fuel Poverty in Scotland. This also applies if their remaining income is insufficient to maintain an acceptable standard of living, currently defined as being at least 90% of the UK Minimum Income Standard. The SNP government has committed to reduce fuel poverty to no more than 5% of households by 2040.

How has this news been received?

The Business and Energy Minister for the UK government, Lord Callanan, had this to say –

“We recognise the pressures that people living in Scotland are facing with the cost of living. That is why we are expanding the Warm Home Discount and increasing the amount households receive so those most in need are supported to heat their homes.

The discount is just one measure we are taking to help tackle rising energy costs. Our energy price cap continues to protect households from volatile gas markets, and later this year families will get £200 off their energy bills, while we have already provided £290 million to fund Council Tax rebates in Scotland.”

While the UK Government Minister for Scotland, Malcolm Offord, had this to say –

“We are acutely aware of how many Scots are worried about the rising cost of living and, where we can help, we are doing just that. Rebates of £150 through the Warm Home Discount will help to directly address the issue of fuel poverty for a quarter of a million Scottish households.

We are facing global challenges, but measures such as these, and our far-reaching £22 billion package of action in 2022 to 2023, will ensure that more people can keep more of their money in their pockets.

Households in Scotland are also benefiting from an additional £296 million of support for the cost of living, including help for high energy costs and a record block grant of £41 billion per year for the next 3 years announced at the Spending Review for the Scottish Government – the largest since devolution.

We are providing an average of £1,000 more per year back into the pockets of working families on Universal Credit and increasing the minimum wage by 6.6%, which will give a full-time worker on the National Living Wage more than £1,000 extra each year. The scheme will continue to support low-income pensioners and other low income and vulnerable households with their energy costs.”

Key Take-Aways

The Warm Home Discount Scheme is a key policy from the Government to tackle fuel poverty and reduce the energy costs for low-income and vulnerable households.

You can read more about eligibility details for the scheme on the Government Website.

The Scheme began in 2011 and has already provided £3 billion in support.

The Warm Home Discount Scotland consultation follows on from commitments made in the Energy White Paper by the UK government to continue the scheme until 2025/26 and expand its support.

Customer Billing – Will I Be Affected?       

As already mentioned, energy costs are spiralling and the price rises are affecting all of us. For UK energy customers it is difficult to say how your bills will be affected due to the serious volatility in the energy markets. It is important to remember that energy prices as a whole are rising, and this will be passed onto consumers through energy bills, making it something to keep a close eye on.        

Different suppliers will feel the pinch in different ways so it is crucial to be aware of the current situation your energy supplier finds themselves in. It is possible to view up to date supplier profiles with any recent changes for all of the energy suppliers in the UK, here.       

At a time where bills look set to rise due to market volatility, it is also a good idea to ensure that you are not being overcharged for any of your utilities. It can be a tricky task to navigate but there are free online tools to remove the hassle available.     

You can find a free online Gas Bill Calculator to see if you are being overcharged, here.       

You can find a free online Electricity Bill Calculator to see if you are being overcharged, here.       

Energy Solutions by Us, for You        

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