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Sunday, 26 October 2014

£140 OFF A WINTER ELECTRICITY BILL

Two million people can get £140 off one electricity bill this winter. It's called the Warm Home Discount. Some will be paid automatically. Others have to claim or they will not get it. And the sooner they claim the better. Some who should be eligible are excluded. 


Core Group

The biggest group – called the ‘core group’ – are more than one and a half million older people who get pension credit. They must get the guarantee part of pension credit - which means their income is no more than £148.35 single or £226.50 for a couple. Pension credit guarantee credit will make their income up to that amount. They must have received it on 12 July 2014. which means they must have been born on 5 July 1952 or earlier and so will be about 62½ now. There are about 1.8 million who could qualify and the DWP expects 1.4m of them to do so. They qualify even if they also get the savings credit part of pension credit. This is a slightly wider definition than was used in 2014/15.

People in the core group should not have to claim. Suppliers will use information from the Department for Work and Pensions to pay them automatically. However, some who qualify may not be identified. If you have heard nothing by Christmas and you think you qualify, contact your energy supplier. Some of the smaller suppliers do not pay the discount and if your energy is supplied by one of them you will not get it. Details below.

Those with slightly higher incomes who only get the savings credit part of pension credit but do not get the guarantee credit will not qualify automatically but may qualify under the broader group described below.

Broader Group
The broader group who qualify are low income households where there is a young child or someone with a disability. With some suppliers pensioners not in the core group can qualify as part of the broader group. People in this broader group have to make a claim.

Unfortunately the energy suppliers all have different rules and their own definitions for what is a low income, what age of child counts, and what counts as a disability. These rules are complex.

If your income is low and there are young or disabled children or disabled adults in the household you may be entitled to the discount.

Pensioners who only get the savings credit part of pension credit or who get another means-tested benefit may qualify in this group too. Again suppliers have different rules.

The DWP expects 600,000 to qualify in this group this year. 

If you think you may qualify contact your supplier using the phone number on your bill and say you are asking about the Warm Home Discount. Or look online on your supplier's website and search for Warm Home Discount. The Government publishes a list of suppliers which are in the scheme. The links there take you to the websites of each supplier that is a part of the scheme. Almost all take you direct to the Warm Home Discount page. With one or two you may have to do a search. 

Claims should be made as soon as possible. Suppliers have a fixed amount of money for this group and when that runs out the supplier will close its scheme. Some may close by the end of December. 

People in the broader group should not switch supplier until the discount is made. They could be disqualified if they do.

Payment

The discount is normally taken off your winter electricity bill which could mean waiting until March 2015. People in the core group who have moved supplier since 12 July 2014 will be sent a cheque by their old supplier. Broader group customers who move supplier before the discount is made will probably lose it. All discounts should be made by the end of March 2014. People on prepayment meters will have the credit added to their key. Some will be sent a voucher to take to the Post Office to credit the key. Other suppliers will update the key automatically.

Supplier

The big six electricity suppliers are legally obliged to offer the Warm Home Discount. They are British Gas (including Sainsbury’s), EDF Energy, E.on, npower, Scottish Power and SSE (that includes Atlantic Energy, Scottish Hydro, Southern Electric, and Swalec). SSE also operates the scheme for Ebico, Equipower, and M&S Energy. First Utility, Utility Warehouse, and Cooperative Energy are also in the scheme. If you get your electricity from any other small supplier you will not get the Warm Home Discount. If you have switched to one of these excluded supplier you may have lost the right to the discount.

Sixteen small suppliers which are not in the Warm Home Discount scheme: Better energy, Daligas, Ecotricity, Extra energy, Flow energy, Good energy, Green energy, GreenStar energy, isupplyenergy, LoCO2 energy, Oink Energy, Ovo, Spark Energy, Utilita, Woodland Trust Energy, Zog Energy.


The Warm Home Discount applies in England, Wales, and Scotland. It does not apply in Northern Ireland.

The Warm Home Discount scheme does not apply to people in Park Homes.

Last year British Gas added £60 to the Warm Home Discount which was then £135. This year it is not adding this amount. So British Gas customers who qualified last year for £195 will only get £140 this year.

The future
Until this year the Warm Home Discount was paid by the energy companies out of their own money. That amount - about £11 per customer - was added on to all customer bills. Under a deal with the Government they have taken that £11 off bills and the Government now funds the Discount directly. So it is a nonsense that each supplier has its own rules for the broader group and that smaller suppliers are not included.

The Government has issued a consultation paper about extending the Warm Home Discount for winter 2015/16. It proposes fixing the amount at £140 though the overall cost is expected to rise to £320m compared with £310 in 2014/15. One question is whether the the broader group rules should be the same throughout the industry. It does not seem to suggest that all smaller suppliers should be included though there is a question where that suggestion could be made. There is also an impact assessment. The main change considered includes extending the scheme to park homes.

More information

The official Government guide to the Warm Home Discount.

The Home Heat Helpline 0800 33 66 99 can give advice about the Warm Home Discount and other schemes to help with heating bills. You could also contact the Energy Saving Trust www.energysavingtrust.org.uk or the Centre for Sustainable Energy www.cse.org.uk They can give advice about local help with insulation as well as national schemes.

29 October 2014 version 1.1