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News UK Home News Energy support scheme that caps bills at £2,500 to be extended The Treasury has come under increasing pressure in recent weeks to cancel the rise
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Your support makes all the difference. Close Read more The energy price guarantee will be extended for a further three months from April to June at its current level, capping average annual household bills at £2,500, the Treasury has confirmed.
Mr Hunt will cancel the planned £500 hike in average energy bills which was due to come into force next month, in a move that would see bills for the average household staying at around £2,500, instead of going up to £3,000 as was previously announced.
The Treasury has come under increasing pressure in recent weeks to cancel the rise, which was set to come into force from 1 April.
Prime minister Rishi Sunak said the move is part of the government’s plan to support hardworking families through the cost of living crisis.
“We know people are worried about their bills rising in April, so to give people some peace of mind, we're keeping the energy price guarantee at its current level until the summer when gas prices are expected to fall,” Mr Sunak said.
The EPG had been due to rise to £3,000 in April, but falling energy prices mean that the current level can be extended to “bridge the gap” until costs fall below the cap.
Chancellor Jeremy Hunt, who included the measure in his Budget being unveiled today, said: “High energy bills are one of the biggest worries for families, which is why we're maintaining the energy price guarantee at its current level.
“With energy bills set to fall from July onwards, this temporary change will bridge the gap and ease the pressure on families, while also helping to lower inflation too.”
A government statement added: “Lower wholesale gas prices are expected to feed through to lower household energy bills from July, where Cornwall Insight data suggests the Ofgem price cap will reach an estimated £2,100 a year for a typical household.”
It is expected to save £160 per household.
The announcement comes as Jeremy Hunt is set to unveil key pension and childcare benefit changes in his highly anticipated Budget on Wednesday.
He is expected to announce a £4bn expansion of free childcare for one- and two-year-olds. The plan is set to include 30 hours a week of childcare for parents in England with children in that age group.
The plan also includes increasing funding by £288m by 2024-25 for the existing programme of free childcare for three-year-olds.
The Budget comes in the wake of the autumn statement last November, which saw the chancellor hike taxes as he and Rishi Sunak sought to restore UK financial credibility after Liz Truss’ short-lived premiership.
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