London Daily

Focus on the big picture.
Friday, Aug 22, 2025

Energy price guarantee: How bill freeze announced by Liz Truss will affect you

Energy price guarantee: How bill freeze announced by Liz Truss will affect you

An unprecedented intervention in the energy market will shield households, businesses and public sector organisations from the worst of the surge in wholesale gas prices.

The Truss government's "energy price guarantee" aims to keep the bill pain facing the public at less than half the amount predicted for the winter ahead, with firms also getting help to protect the economy - but not for as long.

Public sector organisations such as schools are included too.

While the plan shelters us all from the eye-watering sums predicted for bills ahead, there will be a price to pay eventually as the taxpayer is initially being placed on the hook for the support which could exceed the COVID-era bailout in scale.

Here, Sky News explains how you will be helped in the months ahead.

Households


Last month it was announced that the energy price cap would rise to an average annual £3,549 in October from the current £1,971.

That will now not happen.

Ms Truss says the cap will be superseded by the new price guarantee - a sum that will not exceed £2,500 from October for two years.

Helping bring that number back to the level of the current cap is the previously announced £400 discount for each household and a temporary removal of green levies, worth £150 a year, from bills.

The energy price guarantee covers the vast majority of households - around 24 million who pay for their gas and electricity by direct debit.

What this announcement does not mean is that you will not pay more for your gas and electricity. It is an average sum based on unit prices so the more you use, the more you will pay.

What the Treasury is doing is effectively covering the difference between (soaring) wholesale prices that will exceed the household bill 'guarantee' level of £2,500.

I am not currently covered by the price cap. Do I benefit?


A fraction of households are on time-limited fixed price deals.

There are 4.5 million on pre-payment meters who currently pay around 5% more than those under the price cap.

It is understood that the same comparable level of discount will apply across all current variable tariffs in the domestic market but answers are being sought from the government to clarify what that will mean for fixed rate customers.

As things stand, some may have to pay a penalty to exit their deal, assuming it is financially beneficial to do so.

Ms Truss's statement in the Commons did reveal that those who do not directly pay for their energy, such as people living in park homes, would be helped via a fund.

Properties on heating oil, the PM said, would also benefit from the new fund. More details are promised by next week at the latest.

Businesses


Firms have had no shield from rising energy prices unless they had or have a fixed deal.

The toll has led to typical five-fold increases in energy costs - worse for energy intensive companies.

Some of those additional costs have contributed markedly to inflation as they have been passed down the supply chain to consumers in the goods and services we use. Think food, attractions and transport.

What the government said on Thursday was business would benefit with energy assistance for six months, in line with the level of support for consumers.

A series of reviews, starting in December, will then determine which sectors will need targeted aid beyond April.

Ms Truss suggested hospitality would be among the sectors likely to qualify.

Public sector bodies


The same help being offered to businesses will apply to the likes of charities and schools.

Newsletter

Related Articles

0:00
0:00
Close
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
New York Appeals Court Voids Nearly $500 Million Civil Fraud Penalty Against Trump While Upholding Fraud Liability
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
Child-free hotels spark controversy
North Korea is where this 95-year-old wants to die. South Korea won’t let him go. Is this our ally or a human rights enemy?
Hong Kong Launches Regulatory Regime and Trials for HKD-Backed Stablecoins
China rehearses September 3 Victory Day parade as imagery points to ‘loyal wingman’ FH-97 family presence
Trump Called Viktor Orbán: "Why Are You Using the Veto"
Horror in the Skies: Plane Engine Exploded, Passengers Sent Farewell Messages
MSNBC Rebrands as MS NOW Amid Comcast’s Cable Spin-Off
AI in Policing: Draft One Helps Speed Up Reports but Raises Legal and Ethical Concerns
Shame in Norway: Crown Princess’s Son Accused of Four Rapes
Apple Begins Simultaneous iPhone 17 Production in India and China
A Robot to Give Birth: The Chinese Announcement That Shakes the World
Finnish MP Dies by Suicide in Parliament Building
Outrage in the Tennis World After Jannik Sinner’s Withdrawal Storm
William and Kate Are Moving House – and the New Neighbors Were Evicted
Class Action Lawsuit Against Volkswagen: Steering Wheel Switches Cause Accidents
Taylor Swift on the Way to the Super Bowl? All the Clues Stirring Up Fans
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Apple Expands Social Media Presence in China With RedNote Account Ahead of iPhone 17 Launch
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Cambridge Dictionary Adds 'Skibidi,' 'Delulu,' and 'Tradwife' Amid Surge of Online Slang
Bill Barr Testifies No Evidence Implicated Trump in Epstein Case; DOJ Set to Release Records
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
The CEO Who Replaced 80% of Employees for the AI Revolution: "I Would Do It Again"
Emails Worth Billions: How Airlines Generate Huge Profits
Character.ai Bets on Future of AI Companionship
China Ramps Up Tax Crackdown on Overseas Investments
Japanese Office Furniture Maker Expands into Bomb Shelter Market
Intel Shares Surge on Possible U.S. Government Investment
Hurricane Erin Threatens U.S. East Coast with Dangerous Surf
EU Blocks Trade Statement Over Digital Rule Dispute
EU Sends Record Aid as Spain Battles Wildfires
JPMorgan Plans New Canary Wharf Tower
Zelenskyy and his allies say they will press Trump on security guarantees
Beijing is moving into gold and other assets, diversifying away from the dollar
Escalating Clashes in Serbia as Anti-Government Protests Spread Nationwide
The Drought in Britain and the Strange Request from the Government to Delete Old Emails
Category 5 Hurricane in the Caribbean: 'Catastrophic Storm' with Winds of 255 km/h
"No, Thanks": The Mathematical Genius Who Turned Down 1.5 Billion Dollars from Zuckerberg
The surprising hero, the ugly incident, and the criticism despite victory: "Liverpool’s defense exposed in full"
Digital Humans Move Beyond Sci-Fi: From Virtual DJs to AI Customer Agents
YouTube will start using AI to guess your age. If it’s wrong, you’ll have to prove it
Jellyfish Swarm Triggers Shutdown at Gravelines Nuclear Power Station in Northern France
×