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More energy customers could soon be able to apply for a rebate on their energy bills, under proposals from the Department of Energy and Climate Change (Decc) to include smaller suppliers in the Warm Home Discount (WHD) scheme.
Currently, suppliers with 250,000 domestic customers are obliged to commit money to the scheme, and automatically provide the subsidy to qualifying customers. Eligible customers with smaller suppliers have to apply themselves.
Under the proposed new arrangements, the 250,000 customer threshold would be lowered, meaning smaller suppliers would be part of the scheme, and would automatically pass the subsidy onto their customers.
Decc is considering the change because an increase in the amount of data-sharing between energy companies, mandated by the Competition and Markets Authority probe, would mean the government could make the scheme cheaper and easier for suppliers to deliver by “significantly reducing administrative costs”.
This means customer base “no longer has a bearing on how difficult it is to meet the obligation”, it added.
Decc said it would not make any changes to the threshold for participation in WHD for 2016/17.
The spending target for participating suppliers has been set at £323 million for 2016/17. This will rise to £329 million for 2017/18, and will then increase each year to £346 million in 2020/21.
The WHD was launched in 2011 to legally oblige suppliers with more than 250,000 customers to offer those qualifying a rebate on their winter electricity costs.
In its first two years, only the big six were part of the scheme but now, in year five, 11 suppliers are participating.
Interested parties have until 6 May to respond to the consultation.
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