The government's energy price guarantee will now end in April 2023

The energy price guarantee (EPG) – the flagship element of the Government’s recent mini-budget – will now only apply to all households until April 2023, in a dramatic U-turn announced on 17 October.

The EPG was due to be in place until October 2024 for all domestic energy customers, but the government has now gone back on this plan. It has confirmed that the scheme will only be applicable to all households until April next year.

Newly appointed Chancellor Jeremy Hunt announced the change in an emergency televised statement today (17 October). He said that from April, the government will instead look to target help towards those most in need, instead of doing so universally. 

The change to how the EPG is run is just one of several scaled-back or amended measures that Hunt’s predecessor, Kwasi Kwarteng, announced in the mini-budget in September 2022. 

That mini-budget has now changed dramatically. Find out everything that was announced in the mini-budget and how it's now changed.

Read on to find out what this latest change could mean for your future energy bills.

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How will the revised energy price guarantee work?

The EPG was due to freeze energy unit rates from now until October 2024 for customers in England, Scotland and Wales. It will now only be applicable to domestic energy bills until April 2023.

This means that if your energy prices are now at the fixed rates – somewhere around 34p per kWh of electricity and 10.3p per kWh of gas – they will stay like that through winter. You will also continue to receive the £67 (or £66) a month top-up payments via your energy company, in the Energy Bills Support Scheme (EBSS). 

From 1 April, the EBSS payments will stop. At that point, unit rates are likely to increase and prices will go back to those set by the Ofgem price cap, which means households are likely to see a considerable jump in their energy bills. 

Jeremy Hunt (pictured) has said that low-income households will receive different support for their bills from next April, but what this will look like, and who will be eligible, has not been made clear yet.

If you are currently on a fixed rate that's lower than the EPG, your payments will stay as they are until your contract ends. If you are on a fixed tariff that is currently being reduced by the EPG, then it will return to its original rates from 1 April.

Energy prices for suppliers will continue to change while the EPG is in place, but the government will be paying the excess instead of customers. 

A new energy bill review for those most in need

Hunt said that instead of continuing the EPG from April 2023, the Treasury will conduct a review into how – and by how much – different groups of people will need help paying their energy bills from then onwards. 

This new approach he says aims to save taxpayers money while targeting support to those most in need of help to afford their energy payments instead.

It's not yet clear who will be eligible for this, or what the support will be.

Find out more about the help available to pay your energy bills

What’s the long-term plan for energy bills?

Prime Minister Liz Truss has promised a review of energy regulation to create a more affordable system in the long term. This will include an Energy Supply Taskforce designed to get energy suppliers as well as producers of renewable energy to negotiate contracts that reduce energy prices in the long run. 

The government also wants to increase supplies of various types of energy. With this in mind, it has lifted the ban on fracking, which extracts oil and gas from deep in the earth. The practice was previously banned due to the potential pollution of ground and surface water and threat to wildlife.

Truss wants the UK to be a net energy exporter by 2040, through a range of domestic energy production including fracking, nuclear and renewable energy generation. She also announced a review into how the country delivers net-zero carbon emissions by 2050.

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Chaos and U-turns have heaped confusion and uncertainty onto struggling consumers

Rocio Concha, Which? Director of Policy and Advocacy, said:

‘The chaos and U-turns of recent weeks have heaped confusion and uncertainty on consumers – who were already facing the worst cost-of-living crisis for decades. Now, households up and down the country will be worrying about what will happen when universal support in paying energy bills comes to an end in April. 

‘The government must clarify how they will support the most financially vulnerable after April and ensure that, as energy prices remain incredibly high, consumers are not left struggling to make ends meet. 

‘The government must also go all out to turbocharge the adoption of energy efficiency measures – such as home insulation – to help reduce households' energy bills in the long-term.’

Get help with your household expenses: head to our cost of living tips and advice and find out how to get help if you're struggling to pay your energy bills