United Kingdom • • • 🌿 Progressive

Casas adosadas británicas al anochecer con un contador de gas y una factura en blanco en primer plano
Imagen alusiva generada: viviendas británicas al anochecer, contador de gas y factura de energía en primer plano · Imagen generada para EPM

UK to pay £100 to millions of households to ease energy bills from January 2027

The UK Government will pay £100 from January 2027 to households in England in Council Tax bands A to D, reaching up to 20 million households.

--- The context --- Energy bills have risen this year due to the conflict in the Middle East, according to the UK Government. The Autumn Budget 2026 seeks to give families immediate breathing space with the rising cost of living and to help control costs in the longer term, by taking standing charges off gas bills, supporting households with energy debt and reforming the market to bring costs in line with Europe within 10 years. --- The facts --- The centrepiece is the Household Energy Payment: £100 for households in Council Tax bands A to D in England. Up to 20 million households will be eligible, including an estimated 83% of fuel stressed households in England and 88% of households in the bottom three income deciles. Payments will be made from January 2027 to households liable for council tax that live in those bands as their main home. Second homes, empty properties and households where the householder is not responsible for council tax are not eligible. Households that pay by direct debit will not need to do anything, because the rebate will be paid into their bank account; those that do not pay that way will be invited by their council to apply. The scheme applies in England; Scotland, Wales and Northern Ireland will receive additional funding and their governments will decide how to provide similar support based on local needs. For struggling households outside bands A to D there will be an additional £100 million for discretionary support from local authorities, and households on means-tested benefits may also be eligible for the £150 Warm Home Discount. On debt, one-off relief will go to vulnerable households that re-engage with their supplier: debt built up since the energy crisis of 2022-4 may be written off if the billpayer is on means-tested benefits, disability benefits or is a pensioner. VAT was also removed from electricity bills on October 1, saving an average of £45 a year, extended until July 2027. The UK Government also says that taking an average of £150 off bills at the Autumn Budget in 2025 particularly benefited higher users of energy. --- The positions --- The UK Government has asked the regulator Ofgem to remove standing charges on gas bills as early as 2027. It says many families, particularly low energy users, feel those fixed costs are unfair, and that the typical household on median gas consumption will benefit. The essential costs those charges pay for will move to the unit rate, so how much a household pays overall will depend on its energy use. In the longer term, the Government proposes building more homegrown, clean energy so that expensive gas sets the price of electricity less often, reducing Britain's exposure to volatile international gas markets, and reforming the system through greater public control, such as via Great British Grid, to accelerate the network infrastructure Britain needs. --- What remains unknown --- Still missing are the full eligibility criteria for the payment, to be published in due course; the criteria each council will set for its discretionary fund; the mitigation for vulnerable high gas users, to be set out later; and the final design of the debt scheme, on which Ofgem will shortly consult. --- Unanswered questions --- When will the full eligibility criteria for the £100 payment be published, and which exempt households will be included? How will each council set the criteria for its discretionary fund, and when will applications open? What mitigation will vulnerable households that cannot reduce their high gas use receive? --- EPM analysis --- The package tackles three problems at once: the immediate price, the structure of the bill and the debt already built up. Its band design concentrates help where most fuel stressed households are, but leaves out struggling households in other bands, which is why the discretionary fund plays a correcting role that will depend entirely on how each council applies it. 📌 EPM Take: In EPM's view, the main strength of the package is its breadth: it reaches lower-income households, households under fuel stress and people in debt who need a concrete route back to paying. The £100 payment, the £100 million discretionary fund and debt relief together form a fuller safety net than a single isolated payment. Its limit is equally clear: immediate help is no substitute for market reform or for homegrown clean energy. If those two tracks move forward, today's relief could turn into lower and steadier bills for families over time.
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