We know many households around Scotland will be concerned about the huge incoming price rise in energy bills, set to begin in April 2022.
With concern comes a lot of questions and Changeworks have put together a handy list of FAQs to answer any queries you may have – from how much extra you’re likely to be paying, through to ways you can start to save money now.
The news headlines say that energy prices are going to rise on average by £693 a year. Why is this happening?
In short, it is due to the rise in the government energy price cap that is set by Ofgem. The price cap is rising because it costs energy suppliers more to buy electricity and gas and sell it on to customers.
What is the energy price cap?
The energy price cap is the maximum amount an energy supplier can charge customers who are on their standard variable rate tariff. It is set based on the operating costs of the energy suppliers. Fixed tariffs and certain green tariffs are excluded.
What is a fixed rate tariff?
A fixed rate tariff is where the unit rate and standing charge is guaranteed for a specified time. An end date will be given and is often included in the name. This is not subject to the new price cap.
What is a variable tariff?
A variable tariff is where the unit rate and standing charge can be changed by the supplier. This is subject to the new price cap.
How do I find out exactly how much more will I be paying for my energy bills?
Not everyone’s costs will go up straight away – fixed rate tariffs should be honoured. The amount more you will pay is based on what your current tariff is and how much energy you use. Your energy supplier will tell you if you contact them and ask. Your energy supplier will tell you about any change to your tariff and any changes to what you actually pay them.
I have a prepayment meter. How much more will I have to pay for my energy?
Prepayment meters will also be affected by increased rate changes. It means your meter will run out of credit more quickly than before. How much will depend on how much energy you use. For example, a top-up that used to last you seven days may now only last four or five days.
What ways can I save money now ahead of the price rise in April?
There are many small and simple ways you can start to save money on your energy bills, such as only filling the kettle with the water you need to boil, using a shower instead of a bath and switching off lights in an empty room. For more detailed information on energy saving tips, download our Switched On advice pack.
Discounts & Benefits
What discount schemes or benefits are in place to help me with my bills?
One of the most accessible discount schemes on offer is the Warm Home Discount scheme, which offers a £140 rebate from your energy supplier if in your household:
- Someone receives the Guarantee Credit element of Pension Credit, even if you get Savings Credit as well
- The annual income is less than £16,090 or there is a means tested benefit e.g. income support, income-based job seekers allowance, universal credit
- There is a vulnerability e.g. young children in the household, disability, aged over 62.
If your energy supplier is part of the scheme, you can apply directly to them or contact them for more advice or ring Changeworks Affordable Warmth Services Team on 0800 870 880 to find out more and how to register.
What is the Scottish Government doing to help those struggling with energy bills?
The Scottish Government will give £150 to all households that already receive council tax reduction. If you live in a household that pays council tax in Bands A-D but don’t receive council tax reduction, you’ll also receive the £150 rebate from April 2022. This £150 rebate is in addition to the £200 ‘discount’ being offered by the UK Government.
UK Government has also announced a £200 ‘discount’ on energy bills for all UK households. Customers will pay back the discount automatically in equal instalments over five years, starting from financial year 2023-24, when wholesale gas prices are expected to come down.