• Ofgem is raising the energy price cap by 6.4% from April 2025, increasing average annual bills by £111

• The rise will add around £9.25 per month to household energy costs, with high-usage homes potentially facing higher increases

• But the government has proposed expanding eligibility for the £150 Warm Home Discount to 2.7 million more households

• Under the proposals, 6.1 million homes could benefit from financial help, but these plans still need to be finalised through a consultation process

• Eligibility for the Warm Home Discount currently includes low-income households, with applications required for some groups

Households are set to see a 6.4% increase in their energy bills from April 2025, but help could very well be on the way through a new £150 payment.

Millions of households will see their energy bills rise again from April 1 as Ofgem raises its price cap for the third consecutive quarter.

The regulator has said that the 6.4% increase will push the average annual bill for households in England, Scotland, and Wales on a standard variable tariff from £1,738 to £1,849.

The increase will add £111 to the average household's annual bill, equivalent to around £9.25 per month over the three-month price cap period.

The energy price cap limits the maximum amount suppliers can charge per unit of gas and electricity, as well as the daily standing charge. But it does not cap the total bill a household pays - only the rates per unit of energy used.

Households with high energy usage, larger properties, or poor insulation may see higher bills, whereas those who are more energy-efficient could pay significantly less.

But under new proposals from the Department for Energy Security and Net Zero (DESNZ), around 2.7 million additional households, including nearly one million with children, could qualify for the £150 Warm Home Discount next winter.

On Tuesday (February 25), DESNZ announced that one in five families in Britain would receive financial assistance, bringing the total number of eligible homes to an estimated 6.1 million.

Energy Secretary Ed Miliband said the rising price cap was “worrying news” for many families, adding that the Government “is determined to do everything we can to protect people from the grip of fossil fuel markets.

“Expanding the Warm Home Discount can help protect millions of families from rising energy bills, offering support to consumers across the country.”

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It’s worth noting that the plans to expand eligibility for the Warm Home Discount are currently just proposals.

For these plans to be confirmed, they first need to undergo a formal consultation process where DESNZ gathers feedback from stakeholders, including energy suppliers, consumer groups, and the public.

After reviewing the feedback, the government will consider making any necessary changes before finalising the policy. This process could take several months, with the final decision potentially coming in the second half of 2025.

Who is currently eligible for the Warm Home Discount?

Currently, eligibility for the Warm Home Discount is primarily aimed at low-income households or those who are considered to be in a vulnerable situation.

The scheme is divided into two groups: the Core Group and the Broader Group. The Core Group automatically includes individuals who are receiving the Guarantee Credit element of Pension Credit, which is part of the state pension for those on a low income.

These households do not need to apply as they are identified by the Department for Work and Pensions and receive the discount automatically.

The Broader Group, on the other hand, includes low-income households who are not automatically eligible.

To qualify, individuals in this group need to meet certain criteria set by their energy supplier, which could include being on means-tested benefits or having a disability.

To apply, these households would need to contact their energy supplier directly to find out if they qualify and how to apply. Suppliers often require certain details, such as income information, or proof of benefit receipt.

Applications for the discount can generally be made between autumn and winter, as the scheme typically runs from October to March.

We’d love to hear your thoughts on the rising energy bills and the proposed changes to the Warm Home Discount. Do you think the Government’s plan will help ease the financial strain for households? Share your opinions in the comments.