2023 Spring Budget update

2023 Spring Budget update

Published: 15-03-2023

On 15th March, the Chancellor of the Exchequer, Jeremy Hunt, gave his Spring Budget.

This included several measures related to supporting households with their energy bills, including a three month extension on the Energy Price Guarantee.

Our Director of Technical Services, Martyn Bridges, commented;

“We welcome the Chancellor’s three-month extension of the £2,500 price cap to reduce financial pressures on UK households.

“However, this is only a temporary measure. We were hoping to see a national grant scheme encouraging homeowners to insulate their properties and increase energy efficiency. A solution that would reduce energy usage and costs for the long-term.

“But given cost-of-living, homeowners will generally struggle to consider property improvements. This could also have a knock-on effect on our road to decarbonised home heating, as more efficient homes are suited for low carbon technology. We hope to see further commitment and measures from Government in supporting homeowners in increasing their EPC Ratings in the near future.”

Below we’ve answered some of the most pressing questions you may have around how the Spring Budget affects you and your energy bills.

What is the energy price guarantee?

The energy price guarantee (EPG) is a limit on the amount households could be charged for each unit of energy used.

This guarantee was set at an average of £2,500 for the typical household. It was to rise to £3,000 a year from April 2023 but ahead of the Spring Budget on the 15th March this decision was revoked.

The EPG is scheduled to stay in place until April 2024.

How is that different to the energy price cap?

The energy price cap is controlled by energy industry regulator Ofgem. This confirms the maximum price energy suppliers can charge households on either a standard or default tariff.

This is set every three months and is currently higher than the EPG.

I’m not on a tariff, I have a prepayment meter, what does that mean for me?

During the Chancellor’s Spring Budget, it was also promised that prepayment energy meter bills would be cut by £45 from 1 July to be more aligned to customers paying by direct debit on tariffs.

When will energy prices come down?

It is estimated that Ofgem’s energy price cap will fall to £2,153. If this happens then this will fall below the EPG.

For more information on the Spring Budget and what help there is for gas and electricity bills please visit: https://www.bbc.co.uk/news/business-58090533.

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