Soaring energy bills have brought a lot of stress and worry to households and businesses across the north and north-east.
Many have been hit with new monthly direct debit amounts that are simply not affordable and left wondering where they will find the extra money to cover them.
The new prime minister, Liz Truss, last week outlined her plans to deal with the problem.
At the heart of these is a move to limit the 80% rise in domestic bills that was earmarked for October.
Ms Truss said energy bills for the average UK household would be frozen at no more than £2,500 from October 1.
Many people still face having to pay more than they can afford, despite the cap.
The average cost of energy for households last winter was £1,277, which means even on the lower cap we are all going to be paying more than twice as much.
How can I reduce my bill?
Firstly, contact your energy company and see if they will consider reducing your direct debit amount.
But just be careful any new amount you agree to doesn’t leave you in debt further down the line.
How much will I pay?
You will still pay for the gas and electricity you use. The less energy you use, the less you will pay – so you can still save money on your energy this winter.
But what the cap does mean is the UK Government’s energy price guarantee will limit the price suppliers can charge for each unit of energy. This will last for two years.
The energy price guarantee covers the vast majority of households – about 24 million who pay for their gas and electricity by direct debit.
For a typical household, it means annual bills will not rise above £2,500 from October.
Without this freeze, that annual bill would have been £3,549 a year.
The cap is for the average home – if you use more gas or electricity, the cap will be higher.
Those on a fixed deal
People on a fixed deal are locked in and pay a specified rate for a set period.
It is understood suppliers are being asked to discount current fixed deals or allow customers to transfer to the cheaper variable deal without penalty.
If you fixed it within the past 14 days, you can cancel without charge.
Money expert Martin Lewis has advised those on fixed tariffs to wait before cancelling as these prices are likely to fall.
I'm sorry to post about energy right now, but this is important update, and may impact choices people are making right now. This is specifically about those on fixed tariffs.
The info on the rules for fixes may be changing…
CONTINUED…..— Martin Lewis (@MartinSLewis) September 8, 2022
What about the £400 energy rebate?
Millions of households will still receive the £400 energy rebate this winter.
The Energy Bills Support Scheme will provide help to 29 million homes across Britain, with payments starting in October and running for six months.
Scottish Gas, EDF, SSE and Ovo Energy are distributing the payments directly into the bank accounts of those customers who pay by direct debit.
Bulb, E.ON, E.ON Next, ScottishPower, Shell Energy, Octopus Energy, Utilita and Utility Warehouse will apply the rebate as a discount off bills.
Price freeze not enough
Advice Direct Scotland (ADS) chief executive Andrew Bartlett said: “This announcement will come as a relief to many, as the expected increases to people’s energy bills will be halted.
“However, the guarantee will not protect households still struggling with the jump in prices earlier this year.
“We know people are already rationing energy and making difficult choices to get by, and that many families are worried about how they will get through the winter.
“No one should struggle alone and the important thing to remember is that help is available.”
New energy price guarantee – 15 quick need to knows for CONSUMERS. Please feel free to share…#energybills #priceguarantee pic.twitter.com/IbQkJqXJoq
— Martin Lewis (@MartinSLewis) September 8, 2022
ADS offers a range of services, including energyadvice.scot, where expert advisers can provide free practical advice on the support and assistance available.
It can also help with understanding energy bills and make referrals to sources of support for those who need help with rising energy costs, such as the Scottish Government’s Home Heating Support Fund.
In addition, ADS has a free online checker tool, available at advice.scot, which is tailored for Scots and allows people to check their entitlement to state benefits.
