From October 1, a new ‘Energy Price Guarantee’ will mean a typical UK household will now pay up to an average £2,500 a year on their energy bill for the next two years.
This does not apply to Northern Ireland, however, the government has promised households on this side of the Irish Sea will get the same support with energy bills as the rest of the UK.
The Guarantee means the average household will save at least £1,000 a year based on current energy prices from October and is in addition to the £400 energy bills discount for all households.
Those households who do not pay direct for mains gas and electricity – such as those living in park homes or on heat networks – will be no worse off and receive support through a new fund.
There are currently no details on how the support will be delivered in Northern Ireland but it will require new legislation to be passed. At present there is no functioning executive.
Speaking earlier today, Finance Minister Conor Murphy said: “We would have ordinarily got money through the Barnett consequential which the executive then would’ve distributed in a similar scheme.
“But because the prevention of the assembly and executive meeting we can’t access that money so it will fall to treasury to make sure we have an equivalent level of support.
“We will try and work continuously with the British government to try and lobby to make sure the support that has become available, which is welcome, will get out on the ground here as quickly as we can and try and assist people.”
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Meanwhile, the UK government says today’s action will deliver substantial benefits to the economy – boosting growth and curbing inflation by 4-5 points, reducing the cost of servicing the national debt.
Prime Minister Liz Truss said: “Decades of short-term thinking on energy has failed to focus enough on securing supply – with Russia’s war in Ukraine exposing the flaws in our energy security and driving bills higher. I’m ending this once and for all.
“I’m acting immediately so people and businesses are supported over the next two years, with a new Energy Price Guarantee, and tackling the root cause of the issues by boosting domestic energy supply.
“Extraordinary challenges call for extraordinary measures, ensuring that the United Kingdom is never in this situation again.”
As businesses have not benefited from an energy price cap and are not always able to fix their energy price through fixed deals, many are reporting projected increases in energy costs of more than 500%.
A new six-month scheme for businesses and other non-domestic energy users (including charities and public sector organisations like schools) will offer equivalent support as is being provided for consumers. This will protect them from soaring energy costs and provide them with the certainty they need to plan their business.
After this initial six-month scheme, the Government will provide ongoing, focused support for vulnerable industries. There will be a review in 3 months’ time to consider where this should be targeted to make sure those most in need get support.
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