News

Having considered the consultation response, we intend to proceed with the extension and expansion of the Warm Home Discount scheme to 2026 and reforming the scheme in England and Wales.

The main consultation proposals that we will implement are:

expanding the overall spending envelope to £475 million (in 2020 prices) each year for Great Britain
increasing the value of the rebates to £150
maintaining the current Core Group 1, continuing to provide rebates to around one million low-income pensioners
creating a new Core Group 2 of around 1.9 million households on low incomes and with high energy costs, identified through data matching. Rebates to this group will be awarded automatically
making Industry Initiatives mandatory, in recognition of the valuable support to households through this energy-related and financial measures
introducing changes to specific Industry Initiatives measures to better target the support towards households in need
reducing the supplier participation thresholds in 2022 to 2023 and further in 2023 to 2024

We have also decided to make the following changes in light of the responses to the consultation:

including Housing Benefit in the qualifying means-tested benefits in Core Group 2
requiring Ofgem to monitor the levels of spending under each Industry Initiative in relation to disabled households, through estimated annual reporting from energy suppliers
while we will adjust the overall value of Industry Initiatives each year by up to £10 million to offset fluctuations in the rebates, we will not adjust the value further in year by £5 million as we had proposed
maintaining the overall debt write-off cap under Industry Initiatives at £6 million per year

The government will lay the regulations at the earliest opportunity for the scheme years up to 2025/2026. While the regulations will come into force after the usual start of the scheme year, spending on Industry Initiatives incurred between 1 April 2022 and the regulations coming into force will count towards suppliers’ obligations, as long as they are subsequently approved by Ofgem.

The government will consult on separate arrangements concerning a Warm Home Discount scheme in Scotland.

Detail of feedback received

We received 87 responses to the consultation from a range of:

energy suppliers
charities and consumer bodies
housing associations
local authorities
public bodies, including the energy regulator, Ofgem
members of the public

There was general support for the expansion and reform of the Warm Home Discount scheme and the main proposals in the consultation.

Original consultation

Summary

We're seeking views on proposals to extend, expand, and reform the Warm Home Discount scheme to 2026.

This consultation ran from
10:30am on 28 June 2021 to 11:45pm on 22 August 2021

Consultation description

The Warm Home Discount scheme obliges participating energy suppliers to provide rebates to their customers, to reduce energy bills for low-income and vulnerable households and tackle fuel poverty.

This consultation proposes to expand and reform the scheme in England and Wales until 2026, in line with the commitments announced in the Energy White Paper in 2020. The objective of the reforms is to improve the fuel poverty targeting rate of the scheme and ensure more fuel poor households can receive rebates on their energy bills automatically, through the use of data matching. An Impact Assessment setting out the impact of the proposals accompanies this consultation.

We would particularly welcome responses from energy suppliers and charities and other organisations focusing on fuel poverty and vulnerable people.

See the BEIS consultation privacy notice.

Please do not send responses by post to the department at the moment as we may not be able to access them.