8:01 AM, 14th October 2022, About A year ago 38
The government has updated its guidance on how the Energy Bills Support Scheme will hand £400 to tenants who have an all-inclusive rent agreement.
They also reveal that legislation will be brought forward to make landlords pass on the energy bill savings.
The Energy Price Guarantee started on 1 October to help reduce the unit cost of gas and electricity so a typical household will pay, on average, around £2,500 on their energy bill a year – for the next two years.
However, the savings per property will be based on usage and the average household will save around £1,000 per year.
When the scheme was announced, various charities and housing organisations, including Shelter, demanded that the government make landlords hand over the money to their tenants.
The government makes clear that the actual savings and bills could be lower or higher depending on usage, as well as the size of the home, how it is insulated, how much energy is being used and how many people are living there.
The scheme sees £400 being paid in six monthly instalments directly to the energy supplier.
In addition, the most vulnerable households will receive £1,200 of support if they receive certain benefits.
Now, the new guidance makes clear how the £400 discount will be applied for those without direct domestic electricity connection and those living in park homes.
This is what the updated guidance says about tenants who pay for their energy as part of their rent:
Your landlord will benefit from the Energy Price Guarantee if they have a domestic electricity and/or gas contract with a licensed electricity and/or gas supplier and should reflect this in the price they charge you from 1 October.
Similarly, they will receive the Energy Bills Support Scheme and should pass it on to you. We will act now to introduce legislation to ensure this happens.
Your landlord should pass on the discount irrespective of how you pay for your energy use.
If they charge you based on your usage, they must do this at the same price as they pay, including the Energy Price Guarantee (see Ofgem’s guidance on ensuring customers are being charged no more than they should).
If, on the other hand, you pay an ‘all-inclusive’ rent incorporating a fixed charge for energy use, your landlord should pass the Energy Price Guarantee and Energy Bills Support Scheme benefits to you if provided for in your tenancy agreement.
If your landlord has a non-domestic contract, they will benefit from the Energy Bill Relief Scheme and should pass the savings on to you.
In addition to making the rules for landlords and letting agents clearer, there was some confusion when the scheme was unveiled as to whether the government would bring in legislation to enforce the rules – and now the updated guidance makes clear that a law will be introduced to compel landlords with all-inclusive tenancies to pass on the scheme’s savings.
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