Energy Bills Support Scheme - how you’ll get the £400 energy rebate explained

The government has confirmed how households will receive the £400 energy rebate as part of the Energy Bills Support Scheme

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(Image credit: Smart Energy GB)

More than 29 million households will see a £400 discount on their energy bills from October 2022 as part of the government’s Energy Bills Support Scheme. 

Households are facing an unprecedented rise in energy bills as global energy prices continue to soar. As a result, the energy price cap is predicted to increase by 78% when it changes in October. This follows the 54% increase that came into effect in April. 

As part of the government’s cost of living support package to help families cope with rising bills, it was announced that almost all households will receive a rebate on their energy bills to help as we head into winter. Initially, this was meant to be a £200 rebate which would have to be repaid over a five-year period. However, that initial plan has been scrapped and households will now receive a £400 rebate that does not have to be repaid. 

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(Image credit: Future PLC / David Giles)

Business and Energy Secretary Kwasi Kwarteng said: 'While no government can control global gas prices, we have a responsibility to step in where we can and this significant £400 discount on energy bills we’re providing will go some way to help millions of families over the colder months.'

Who is eligible for the £400 energy bills support? 

All households in England, Wales and Scotland that pay for their energy will be eligible for this scheme. The discount will be applied to your energy bills automatically - there is no need to apply.  A similar scheme is being worked out for households in Northern Ireland, but details of that are yet to be confirmed. 

The discount will be applied to your bills by your supplier from October 2022. 

Chancellor of the Exchequer, Nadhim Zahawi, said: 'We know that people are struggling with rising energy prices which is why we have taken action with support over the winter months to help ease the pressure on household budgets.

'This £400 off energy bills is part of our £37 billion of help for households, including 8 million of the most vulnerable households receiving £1,200 of direct support to help with the cost of living. We know there are tough times ahead and we will continue to do everything in our power to help people.'

You will not be eligible for this rebate if you are not connected to the electricity grid. According to Ofgem, this is estimated to be around 500 - 2,000 households.

How will I get the £400 rebate? 

Households will receive the £400 discount over the course of six months. You do not need to apply and it does not need to be repaid. You will receive a £66 discount in October and November, then a £67 a month discount between December and March 2023. The discount will be applied monthly, regardless of whether you pay your bills monthly or quarterly. 

How you get the £400 discount will depend on how you pay for your energy:

  • If you pay by direct debit: you will see the discount as either a reduction in the direct debit amount collected or as a refund (in the same month) after your normal direct debit payment has been collected.
  • Standard credit and payment card customers will see the discount applied as an account credit in the first week of each month of delivery.
  • If you have a smart prepayment meter, you will see the discount credited directly to your meter account in the first week of each month of delivery
  • If you have a traditional prepayment meter, your discount won’t be applied automatically. Instead you will receive a redeemable voucher by text, email or post, which you will then need to redeem at your usual top-up point.

Will I get the energy rebate if I rent? 

If you live in a rented property and pay the energy bills yourself, you will receive the discount. But if you pay your landlord an all-inclusive rent that includes bills, your landlord will get the discount. But you will only see the benefit if your landlord passes it on to you via a reduction in rent. 

What other support is available to help with rising bills? 

A raft of other measures were announced as part of the government’s cost of living support package including: 

  • A £650 one-off cost of living payment for low-income households on means-tested benefits
  • A £300 payment for pensioners who receive the Winter Fuel Payment
  • £150 payment for people across the UK who receive certain disability benefits
  • A £500m increase and extension of the Household Support Fund to help councils to support the most vulnerable households pay for essentials including food, utilities and clothing.

Sarah is an experienced journalist and editor with more than 10 years of experience in the Homes industry, working across brands such as Homebuilding & Renovating, Period Living and Real Homes. After segueing into the world of personal finance, acting as launch editor of Ideal Home's sister brand, Sarah became Editor in Future’s Wealth division with a focus on property-related finance and household bills, working across brands including GoodtoKnow and Ideal Home. She is passionate about helping people cut through confusing jargon to make the right financial decisions when getting on the property ladder and turning a house into a home.