Government help with energy bills: What support can you receive?

Man sitting on sofa and using laptop at home
You could be entitled to government help with energy bills as well as for home improvements (Image credit: Getty Images)

Many of us will soon be receiving government help with energy bills, and as the cost of living crisis worsens it’s important to know what support you are eligible to receive.

Finding energy saving tips to lower our consumption has been a top priority for most homeowners this year amid surging energy price rises. This can be anything from switching to LED bulbs, to making more substantial improvements like installing new insulation. 

What many homeowners don't perhaps realise is that there is government support available to help you make these improvements.

Here is a round-up of funding options to help with your energy bills, and to make home improvements that can lower your energy usage. 

The £400 energy grant

The government’s £400 energy grant takes effect from October and will be paid over six months. The grant is expected to cover around 28 million homes in England, Scotland and Wales, including houses that are not connected to the electricity grid. 

In October and November, energy suppliers will discount £66 from household energy bills. This will then rise to £67 a month from December to March 2023. 

If you pay for your energy by direct debit or use a ‘smart’ prepayment meter then you do not have to do anything to receive the money, it will be credited to your account. But if you use a traditional or "non-smart" prepayment device you will instead receive a discount voucher in the first week of each month, either via text, email or in the post. You will then need to redeem these in person at your usual top-up point.  

The Energy Price Guarantee

The Energy Price Guarantee was announced in September to prevent millions of households facing a significant spike in their bills from October as a result of the 80% increase to the Energy Price Cap

The guarantee will see typical energy bills frozen for millions of households at £2,500 a year, although you may end up paying more than this if you use more than a typical amount of energy.

The price freeze will apply to those on default tariffs, but those on fixed-rate tariffs are expected to benefit too. Most households on fixed-rate tariffs will see an automatic energy discount on their bills from October.

Since the announcement of the Energy Price Guarantee, the government has confirmed that the same reduction to variable tariff rates - 4p/kWh gas and 17p/kWh electricity - will apply to many fixed rates too. This is roughly a 30% decrease. However, some homes paying higher price fix tariffs could end up paying more than this. 

The price guarantee will also cover those using LPG and heating oil, who will receive discretionary payments to help them manage their bills. Further details on these payments are expected to be announced later this month. 

The Energy Company Obligation

The Energy Company Obligation, or ECO, is a government scheme that places a requirement on the biggest energy suppliers to install energy-saving measures in people’s homes. 

ECO is prioritised to low-income and vulnerable households, so you’ll need to be in receipt of certain benefits to apply. But if you meet the criteria then you could be eligible for a number of home improvements, either for free, or in exchange for a contribution towards installation costs. These improvements include:

  • Insulating a roof
  • Cavity wall insulation
  • Solid wall insulation
  • Boiler replacement or repair.

Energy companies can also pay for homes to connect to district heating systems, and to have heating controls installed.

Warm Home Discount Scheme

The Warm Homes Discount Scheme provides households on low-incomes or pensions with a one-off yearly payment of £140 (rising to £150 in winter 2022).

Providing you are eligible, and your energy supplier is part of the scheme, then you will receive this money as a one-off rebate (inclusive of VAT) on your electricity bill. This is automatically actioned each year by your energy company between October and March. 

What other support is available?

The government recently launched an energy MOT to make homeowners make their properties more energy efficient. There are also various energy apps to help reduce your energy consumption.

Plus, the following support is available:

  • Insulation grants - check if you’re eligible for financing towards installing cavity wall insulation, loft insulation or external wall insulation
  • Window replacement grants - if you need to replace old or broken windows then some households may be eligible for funding for the cost of installation
  • Heat pump grants - get funding assistance for the installation of low-carbon heating systems, including the Boiler Upgrade Scheme.
Jack Woodfield
News Editor

Jack has worked in journalism for 11 years and is the News Editor for Homebuilding & Renovating, a role he has had since 2019. He strives to break the most relevant and beneficial stories for self builders, extenders and renovators, including the latest news on the construction materials shortage and hydrogen heating. In 2021 he appeared on BBC's The World at One to discuss the government's planning reforms. 

He enjoys testing new tools and gadgets, and having bought his first home in 2013, he has renovated every room and recently finished a garden renovation.