Government Announcement - Support Package for Gas and Electricity Supplies

Overnight it was announced that Business Secretary Jacob Rees Mogg would be making an announcement this morning about a business support package for commercial gas and electricity costs. The announcement was issued at 9.30am and these are the key points:

• The scheme will apply to fixed contracts agreed on or after 1 April and variable and flexible tariffs and contracts. This also applies to those currently on Out of Contract rates

Therefore if you signed for example, a 50p kwh electricity contract commencing on 1st April, you will pay that rate between April and October and then the price cap as it applies to you will come into effect from 1st October 2022 for 6 months

• The price mechanism applies to consumption during the period 1 October 2022 to 31 March 2023

• The wholesale electricity cap is 21.1p per kWh

• The wholesale gas cap is 7.5p per kWh

• Wholesale costs are for the energy component. These are not normally separately listed on the bill. Wholesale costs do not include the Third Party costs of transmission and distribution, metering, green levies etc. All these additional costs will still be incurred at the previous rates

Third party charges are a significant component of your electricity unit costs and, while they differ slightly for every contract, as a rule of thumb they will add 10-15p kwh onto the wholesale cost of a unit of electricity and around 1p kwh onto the wholesale cost of a unit of gas

• HTP holds detailed information on the wholesale market so when possible will validate the reduced costs to ensure that you are correctly charged and getting the full benefit of the subsidy

• You do not need to contact suppliers as the discount will automatically be applied to bills and savings will be seen from October's bills but received in November

• We expect to hear directly from suppliers in the immediate future with their individual updates on this

• We anticipate that suppliers will struggle to bill this accurately and on time but we are here to support you through this process

• This is an evolving picture with few specific details available as yet. We will be in touch again soon with recommendations for your supplies based upon your individual circumstances