Energy prices have fallen significantly since winter 2022-23, and the Quarter 2 2024 price cap of £1,690 has fallen by nearly 60% since the Quarter 1 2023 price cap peak. Despite this, the Government has committed to supporting households in 2024-25, with a further cut to National Insurance contributions down to 8%, an increase to benefits of 6.7%, and the largest increase to the National Living Wage.

The Warm Home Discount continues to provide a £150 rebate off energy bills for eligible low-income households until 2025-26.

The UK’s strong policy framework – including the Hydrogen Production Business Model, Net Zero Hydrogen Fund and Low Carbon Hydrogen Standard – has created an investable model which has leveraged private investment to kick start the UK’s hydrogen economy.

Government is supporting projects to move the UK closer to our hydrogen ambitions.

In December 2023 we announced 125MW of successful projects from Hydrogen Allocation Round (HAR) 1, and have since launched HAR2, aiming to allocate up to a further 875MW in 2025, subject to affordability and value for money.

From 1 December 2022 to 30 November 2023 (latest available data), around 97,100 insulation measures were installed in domestic properties under the following schemes: Energy Company Obligation, Great British Insulation Scheme, Social Housing Decarbonisation Fund, Green Homes Local Authority Delivery and Home Upgrade Grant. Under these schemes, some households may have had more than one type of insulation measure installed. Statistics for each of these schemes are published on the gov.uk website.

While the Department does not hold precise estimates of how many households will be treated in next twelve months, we estimate around 450,000 will be supported via the Energy Company Obligation Scheme from April 2022 to March 2026 with the scheme funding approx. £1 billion per calendar year.

The Government also estimate over 300,000 homes will be supported via the Great British Insulation Scheme from April 2022 to March 2026 with £1 billion funding available across that period.

The Government is continuing to support those most in need, with millions of vulnerable households receiving up to £900 in further Cost of Living Payments. This is in addition to support available to low-income and vulnerable households, including £250 - £600 through the Winter Fuel Payment and an annual rebate of £150 off their energy bills through the Warm Home Discount.

Energy prices have also significantly fallen in the past year alone and the Q1 2024 price cap of £1,928 has more than halved compared to Q1 2023 when the price cap peaked at £4,279.

The Government recognises the cost-of-living challenges families are facing and in response last winter we launched a package of support for households and businesses, spending £40 billion and paying around half a typical household’s energy bill.

In order to continue protecting the most vulnerable, in 2023-24 the Government is already providing additional cost of living payments of up to £900 to households on means-tested benefits, of £300 to pensioner households, and of £150 to those on eligible disability benefits. The vast majority of this support has been and will be made available automatically to households and without the need for an application process.

The Government has brought together senior business and finance leaders on the Net Zero Council. The Council addresses the appetite from the business and finance communities to create a partnership with UK government to deliver net zero and capture the benefits of this transition in the UK. The Government has relaunched the UK Business Climate Hub, which provides free, detailed advice on how SMEs can reduce their emissions and signposts funding opportunities. The £500m Industrial Energy Transformation Fund supports energy intensive industries to decarbonise and the Department is piloting a Business Energy Advice Service to support SMEs.

As announced in the Spring Budget, the Energy Price Guarantee has been extended at £2,500 to the end of June. By the end of June, the Energy Price Guarantee will have saved a typical household in Great Britain around £1,100 since the scheme began in October, compared to what they would have been paying under the price cap alone.

As set out in the Autumn Statement 2022, the Government is developing a new approach to consumer protection in energy markets, which will apply from April 2024 onwards.

The Government has committed to work with consumer groups and industry to consider the best approach.

The Alternative Fuel Payment (AFP) scheme provides a £200 grant payment to UK households that use alternative fuels for heating instead of mains gas. Most households received the payment automatically through their electricity supplier, who were obliged to pay customers during February. Traditional prepayment customers may receive a voucher which they can redeem within 3 months. For the small proportion of households who could not be paid automatically, the online portal to apply for the support is open on gov.uk now. A small proportion of households will need to apply for the AFP, for example because they do not have a relationship with an electricity supplier. Applications for this Alternative Fund opened on 6 March through a GOV.UK portal which includes an overview of eligibility and what steps households need to take to apply for support.

The Energy Bill Relief Scheme (EBRS), worth £7.3billion, provides a discount on the wholesale element of gas and electricity bills to ensure that all eligible businesses are protected from high energy costs this winter period.

Following a review of the EBRS, a new Energy Bill Discount Scheme (EBDS) starts on 1 April 2023, and all eligible non-domestic customers, except for those experiencing low energy costs, will automatically receive a per unit discount on their bills of up to £19.61/MW for electricity, and £6.97/MW for gas.

The Government’s energy efficiency schemes, such as the Social Housing Decarbonisation Fund, Home Upgrade Grant, and the Energy Company Obligation, all include solar panels as an eligible measure, subject to certain requirements.

The Government is also exploring options to facilitate low-cost finance from retail lenders to help householders with the upfront costs of installation.

Over 3,700 UK small businesses have joined the UN’s Race to Zero initiative, accounting for 70% of the current global total. This is in addition to two thirds of the FTSE 100.

The Government supports SMEs by promoting the UK Business Climate Hub, which is embedded on the SME Climate Hub, and forms part of the global Race to Zero campaign. Here businesses can access a suite of tools for measuring, reducing and reporting on their emissions. These include a carbon calculator tool developed by Google.org and Normative, and the Climate Fit modular education course.

Currently, over 3,700 UK small businesses have joined the UN’s Race to Zero initiative, accounting for 70% of the current global total. This is in addition to two thirds of the FTSE 100.

The Government continues to support SMEs by promoting the UK Business Climate Hub, which is embedded on the SME Climate Hub, and forms part of the global Race to Zero campaign. Here businesses can access a suite of tools for measuring, reducing and reporting on their emissions. These include a carbon calculator tool developed by Google.org and Normative, and the Climate Fit modular education course.

On 6 February, my Rt. Hon. Friend the then Minister for Climate and Energy announced further information on the Non-Domestic Alternative Fuel Payment Scheme (ND-AFP). Electricity suppliers can now start making payments to eligible off-grid energy users and they will deliver this support up to 10 March. Most customers are expected to receive a credit of £150 on bills later this month and will not need to apply.

A top-up payment in addition to the £150 will be available for large users of heating oil (kerosene) in GB and NI to take account of their higher usage. These top-up payments will require an application to a delivery body and will be banded based on level of usage. The Government will set out further details in the near future.

To ask His Majesty’s Government what steps they are taking to help vulnerable households with energy costs; and what is the role of Ofgem in delivering affordable energy.

I pay tribute to the Government’s warm home discount scheme and accept that it has been an enormous success. Recently, the chief executive of Ofcom has asked for a serious assessment of introducing a social tariff. Given the fact that Citizens Advice recognises that there has been an excess profit of £7.9 billion this year for electricity distribution companies, will my noble friend do one of two things: either introduce a new social tariff or increase the warm home discount? Instead of asking other households to pay for it, will he ask the electricity distribution companies to pay for the increase?

My Lords, will the Minister explain why energy bills in the UK are double what they are in the rest of Europe? Can he explain that to the customers?

My Lords, one reason we have very high energy prices, obviously apart from Putin himself, is that we are still very reliant on gas for heating and the generation of electricity. Should not one of the tasks of Ofgem be to persuade the Government to make sure that they have as one of their prime objectives the decarbonisation of our electricity system, not least to make sure that we have connections into the grid—it is a crisis at the present moment?

My Lords, I want to follow on from my previous question about patients at home, some of whom are handicapped children and people on ventilators, using oxygen concentrators and so on; these are pieces of equipment which consume a high amount of electricity. Have the Government undertaken an audit to look at the excess cost borne by these families, where the care is happening at home and such equipment has been installed? Following data from that audit, is there any review of the benefits available in those situations, particularly where there are young people who are extremely handicapped but living at home?

My Lords, I recognise that my question connects with the previous Oral Question. Listening to clergy in my diocese who are operating food banks and warm spaces, they say to me that one of the biggest challenges that vulnerable households are facing as they try to pay their energy bills is accessing information, particularly when it is available only online. What assurance can the Minister give that those responsible for delivering affordable energy, including Ofgem, will use or require the use of alternatives to electronic forms of communication when trying to reach those in need, including partnering with service providers such as food banks?