With news emerging daily of energy firms going bust, not to mention warnings of eye-popping increases to our gas and electric bills, these are worrying times for millions of people and their household finances.
If you’re already struggling to pay your energy bill, or are concerned about how you’re going to meet rising utility costs this winter, there are - fortunately - various steps you can take. Here’s what to do in these turbulent times for utility bills.
Ask for help
If your energy bills are already problematic, or likely to become so this winter, don’t panic, but remember that the quicker you face up to the situation the better.
Help is at hand, but it’s imperative that you share your concerns.
Should you encounter difficulties, the first port of call is your energy supplier (or suppliers if you receive your gas and electric from different companies).
It’s part of a supplier’s licence obligations to work with customers faced with troubling situations to produce a payment plan that solves the problem for both parties.
Potential solutions could include:
reviewing your payments and debt repayments
a reduction in payments
offering more time to pay
providing access to hardship funds
When it comes to hardship funds, the British Gas Energy Trust, for example, awards grants to households to remove energy debt, fund emergency fuel credit and replace condemned boilers.
Against the backdrop of coronavirus, the regulations say that you will not be disconnected if you miss a bill payment.
But, if you are on a credit meter (where you pay monthly or quarterly for energy you’ve already used), then your supplier may move you to a prepayment meter where energy is paid for in advance using a card, key or app.
Prepayment customers who cannot afford to top up their meters may be eligible for temporary credit from their suppliers - although that cost will need to be met at some stage in the future.
Consumer organisation Citizens Advice has more information for energy customers faced with mounting financial woes.
Warm Home Discount
If you’re eligible, the Warm Home Discount (WHD) could take £140 off your winter electricity bill.
The WHD is a one-off payment applied directly to your bill if you’re eligible for the Guarantee Credit element of Pension Credit, or if you are on a low income, receive means-tested benefits and meet your energy supplier’s criteria for the scheme.
The government produces a list of energy suppliers that took part in the WHD scheme during 2020/21. Note that, given some of the recent turmoil experienced by the UK’s energy sector, not all the companies that appear on this list are necessarily still in business.
In addition, not all suppliers are signed up to the WHD, although all those with 250,000 customers or more are required to participate.
If your current supplier is not part of the WHD you could consider a switch to one that is. That said, in this turbulent time for the energy sector, if switching to a new tariff is going to end up costing you more than £140, then there’s little point making the move.
Letter’s in the post
If you receive the Guarantee Credit element of Pension Credit, you’ll receive a letter about the WHD between now and December.
The correspondence will include a deadline for application. Your supplier will apply any discount to which you’re entitled to your bill by 31 March 2022.
Users of prepayment, or pay-as-you-go, electricity meters eligible for the WHD should check with their supplier how the payment will be made, eg, in the form of a voucher.
Occupants of mobile homes will soon be able to apply online for the 2021/22 version of the scheme when it opens using this link.
Winter Fuel Payment
If you were born on or before 26 September 1955, you may be entitled to the Winter Fuel Payment (WFP), a benefit which offers between £100 and £300 towards your heating bill costs depending on your age and circumstances.
Those entitled to the State Pension or other social security benefits (excluding Housing Benefit, Council Tax Reduction, Child Benefit and Universal Credit) receive the WFP automatically with no need to apply.
The WFP kicks in automatically during November and December and payments should be received by 14 January next year.
Cold Weather Payment
Finally, the Cold Weather Payment (CWP) scheme applies during periods of very cold weather and is meant to offset higher-than-normal heating bills.
The scheme’s rules say that you can receive £25 for each seven-day period of very cold weather between 1 November and 31 March. This is defined as seven consecutive cold days of either, recorded, or forecast temperatures of zero degrees Celsius (or lower) in your area.
You may be eligible for the CWP if you receive Pension Credit, Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance, Universal Credit, or Support for Mortgage Interest.
The money is paid automatically into the same account as your other welfare payment(s) within 14 days of the cold weather taking effect.