An extra 30,000 pensioners will see £140 per year cut from their bills, as the Warm Home Discount scheme is extended to smaller energy companies.
At the moment, only bigger energy suppliers – those with 250,000 or more customers – have to guarantee eligible customers will get the winter payment.
Today, the government has announced that all energy companies with at least 150,000 customers must participate in the scheme by 2021. The changes won’t start this winter but in 2019/20.
The government has admitted that the overall number of low income customers benefitting from the scheme won’t change; it just means that more suppliers will have to provide it.
Read on to find out if you’re eligible for the Warm Home Discount. If you’re not, you could save more than £140 by switching energy suppliers. Compare gas and electricity prices using Which? Switch to get started.
What is the Warm Home Discount?
The Warm Home Discount is an annual payment of £140. It is currently paid to around two million low income and fuel poor households in Great Britain.
It’s not just for pensioners; you’re eligible if you fall into either of these groups:
- Core group: those who receive the Guarantee Credit Element of Pension Credit. Usually your energy supplier will identify you automatically so you won’t need to apply
- Broader group: this includes customers on a low income or receiving certain means-tested benefits. Each supplier has its own eligibility criteria – these are approved by energy regulator Ofgem.
At present, only the largest suppliers have to pay it. These are: Atlantic, British Gas, Co-operative Energy, Economy Energy, EDF Energy, Eon, Extra Energy, First Utility, Flow Energy, M&S Energy, Npower, OVO Energy, Sainsbury’s Energy, Scottish Gas, Scottish Hydro, Scottish Power, Southern Electric, Spark Energy, SSE, Utilita and Utility Warehouse.
But three smaller suppliers – Bristol Energy, Fischer Energy and Our Power – pay it to customers voluntarily.
If you’re currently a customer of any other smaller energy supplier, you won’t be able to get the Warm Home Discount payment even if you meet the criteria.
However, some of the smaller suppliers could be cheaper for you overall, even when taking into account the value of the Warm Home Discount. So it’s worth checking whether you will be better off.
Will I get £140 off my energy bills?
The changes will mean that 97% of the consumer energy market will be covered by the Warm Home Discount, according to the government.
In the winter of 2019/20, all energy suppliers with 2000,000 or more customers must provide the £140 payment. By 2020/21, all those with at least 150,000 customers must participate.
But the changes only apply to the ‘core group’ (see above). So, in total, 30,000 extra pensioners are expected to get the payment by 2021, compared with this winter. But overall the number of low income households and those in vulnerable situations benefitting from the rebate will not increase, the government says.
It will review the threshold again in 2021 and it ‘could continue to fall, potentially to zero or a small minimum’.
How else can I save on my gas and electricity bills?
Regardless of whether you are eligible for the Warm Home Discount, there are still opportunities to reduce your gas and electricity bills:
- Check if you’re eligible for other home energy grants, such as Affordable Warmth, Winter Fuel Payment or subsidised insulation.
- Compare gas and electricity prices to see if you could save money by switching energy supplier using Which? Switch.
- Replace your lightbulbs with energy-saving ones – LEDs use 90% less energy than traditional incandescents.
- Choose energy-efficient appliances when you replace yours.
For money money-saving tips, read our 10 ways to save money on energy advice.