Suppliers paid £348m through WHD last year

Vulnerable customers received over £348 million in support from energy suppliers last winter through the Warm Home Discount (WHD), the latest appraisal of the scheme has shown.

A record 19 suppliers participated in 2019/20, including one on a voluntary basis, with the £140 rebate on energy bills paid to 2.2 million customers.

A record 96 per cent of rebates in the core group, which includes low-income pensioners, were paid automatically – amounting to £149.5 million. The proportion has risen from 85.2 per cent when the scheme was launched in 2011.

Larger suppliers also provide the same rebate to a wider pool of vulnerable consumers, who opt into the scheme. A total of 1.145 million customers signed up, receiving £161.9 million in total.

As well as providing rebates, suppliers can offer indirect support to fuel-poor households, including energy efficiency measures, energy advice and writing off energy debts. A record £37.1 million of this support was delivered last winter by 15 suppliers.

The WHD scheme is funded by suppliers with the cost passed on to consumers through energy bills. Ofgem’s administration of the scheme is funded by the government.

The regulator’s annual report on the scheme noted a slight increase in contraventions by suppliers. However, it stressed that the 362 infringements in the core group represented less than 0.03 per cent of over 1.05 million rebates provided in this category.

The Energy White Paper confirmed it was extending the WHD, which had been due to expire in March next year, until 2026.

Ofgem predicts more customers will be eligible to receive support under the WHD this winter due to the economic and health impacts of Covid-19.

There has already been a marked increase in the number of retailers participating in 2020/21 – up to 25. Of these, 18 are compulsory suppliers (over 250,000 customers), five are compulsory small suppliers (over 150,000) and two are voluntary. The latter two categories only have obligations under the core group.

Jonathan Brearley, chief executive of Ofgem, said: “For the last nine years, the Warm Home Discount scheme has provided a lifeline to some of the most vulnerable in our society who struggle to heat and light their homes during the winter in particular.

“Ofgem will continue to work closely with government and suppliers to ensure that consumers get the support they need in the difficult months ahead as we help to build a fairer, greener energy system.”

Kwasi Kwarteng, energy minister, said: “The Warm Home Discount has already helped millions of vulnerable customers and through our commitment to extend the scheme in the Energy White Paper, we will continue helping those most in need with paying their energy bills.

“We have committed to extending the Warm Home Discount to 2026, and from 2022 it will already be reaching nearly three million people, providing £475 million a year for those who need it most.”