Could your energy bills be cut under the cost of living plan?

As the cost of living continues to squeeze households, there’s hope that energy bills might  become a bit more affordable, especially for those on the lowest incomes.

What’s the government planning?

According to The i Paper, chancellor Rachel Reeves is exploring options to ease the pressure of energy costs in her upcoming autumn budget, taking place on Wednesday, 26 November.

One proposal reportedly being considered is lowering the VAT rate on domestic energy bills.

But some Labour MPs and campaigners argue that cutting VAT might benefit higher earners the most. Instead, they’re urging the government to look at reducing or removing standing charges, which impact low-income households more heavily.

What are standing charges?

Standing charges are fixed daily fees added to your gas and electricity bills, regardless of how much energy you use. They help cover costs like:

• maintaining the energy supply network
• meter reading
• billing and customer service

These charges vary depending on your region and supplier. Right now, they’re around:

• £188 per year for electricity
• £109 per year for gas

But from next month, they’re set to increase to £196 for electricity and £124 for gas.

The energy regulator Ofgem launched a review into standing charges two years ago. It’s expected that from early next year, suppliers may be required to offer low or even zero standing charge tariffs.

Help if you're struggling now

While the autumn budget might bring future relief, many people need help right now.

If you're struggling to pay your energy bills, here are some things you might be able to do:

• get emergency credit if you’re on a prepayment meter
• apply for a grant or hardship fund from your supplier
• join the Priority Services Register for extra support

To save on energy and reduce your bills, have a read of our 50 smart energy-saving tips.

Also, find out what happens when you have energy arrears and how to deal with the situation.

We can check you’re getting all the benefits you’re entitled to and help you create a realistic budget.