The Chancellor confirmed on 3 February 2022 that the planned changes to the Warm Home Discount will go ahead, increasing the number of eligible households to 3m and raising the rebate value to £150 from October1. The confirmation came on the same day Ofgem announced the price cap rise that takes effect in April 20221.
Under the new cap, average domestic energy bills for Direct Debit and Standard Credit customers across Britain could reach £1,971, an increase of over 54 per cent1. For the more than 4.5 million customers on prepayment meters, the rise is higher still, up to £2,017, an increase of over £708 compared with bills at the time1. National Energy Action (NEA) estimates the cost of heating an average home will have doubled in 18 months, and that the number of households in fuel poverty will rise from 4 million to 6.5 million across the UK in the six months from October 2021 to April 20221.
The Warm Home Discount change sits alongside other measures announced by the UK Government. These include a GB-wide "rebate and clawback" scheme, with energy suppliers provided with loans to give rebates of £200 to each household in October, to be paid back over five years1. Council Tax payers in bands A to D will receive a £150 rebate from their bills in April, and local authorities have £150 million for discretionary payments towards essentials including energy; £560 million has been made available in other UK nations from next year1.
NEA said the package is not adequate in scale or suitably targeted at those most in need1.
"We said that the package of support is ['woefully inadequate"]"
| Measure | Value | Timing |
|---|---|---|
| Warm Home Discount rebate | £150, eligibility extended to 3m households | From October1 |
| Energy rebate and clawback | £200 per household, repaid over five years | October1 |
| Council Tax rebate, bands A to D | £150 | April1 |
| Local authority discretionary support | £150 million | Not dated in the source1 |
Why it matters for households
The Warm Home Discount is a direct reduction on an electricity bill for households that qualify, so raising it to £150 and widening eligibility to 3m households changes who can receive help and by how much. The Warm Home Discount is separate from the £200 rebate, which is a loan recovered through bills over five years, and from the Council Tax rebate, which is not an energy payment. Households wanting to know whether they fall inside the expanded group can check who qualifies for the Warm Home Discount, and the process for receiving it is set out in how to claim the Warm Home Discount. Because the discount is applied through the supplier, it reduces the amount billed rather than changing how much energy a home uses, so it does not by itself lower consumption or improve a property's efficiency. For a household weighing up the different forms of support, the Warm Home Discount compared with the Winter Fuel Payment and the social tariff compared with the Warm Home Discount set out how the schemes differ. The wider set of home energy grants and schemes covers support beyond bill rebates.
What happens next
The price cap rise announced by Ofgem takes place in April 20221. The Council Tax rebate of £150 for bands A to D is due from April1. The £200 rebate and clawback payment and the increased Warm Home Discount, at £150 for 3m households, both begin in October1. The source does not report a date for the £560 million allocated to other UK nations beyond "next year"1.