Impact of energy price increase on residents
24 March 2022
Energy prices are rising for everyone across the UK as well as cost of living. All residents will be affected by these price increases which will vary depending on who provides and / or manages your energy supply. We know this is going to be a difficult time for many residents and we aim to keep you informed about any changes to the price of services we’re aware of, how we can help, and the support you can access from other organisations.
How the increase in energy price may affect you
The increase in energy prices and cost to you will depend on how, what and who you pay for your energy supply. We’ve listed below the changes we’re aware of.
Energy charge if you pay for your gas directly to a utility gas supplier
Your utility supplier will set the rate you pay. The price is subject to the price cap which will increase by 54% for default (standard variable tariff) and prepayment tariff energy customers. A further increase is also likely to be announced in October 2022.
If you are on a default or prepayment tariff, you will be affected by the price cap. If you are currently on a fixed-rate tariff, you’ll be moved to your provider’s standard variable tariff when the fixed term ends. For example, a customer with an average use on the most expensive tariff would have been paying an estimated £1277.00 per year. This will increase by 54% to an estimated £1971.00. You will need to contact your gas supply company for more information on how this will affect you and to find out what you can do.
Energy charge if you pay Network Homes for your energy supply through Insite Energy
If you pay for your energy supply through Insite Energy Ltd, then your home will be connected to a heat network (also known as a communal or district heating system). This means that the heat and hot water to your home comes from a single, central source - such as a large boiler in a basement plant room. Network Homes is the owner of the heat network for your home which means we purchase gas on a commercial basis to feed the boilers which in turn produces the heat and hot water circulated around the building into your home.
Due to the extremely instability of utility prices in the wholesale market, we have decided not to fix prices at the current high levels for 12 months. We have agreed shorter contracts with our suppliers with a view to fixing prices for the longer term when the current price spikes subside.
We do not know exactly what the average price for utilities will be for the next 12 months, but we will continue to carry out competitive tendering processes to ensure that the price we pay for gas is the best that we can secure. We are certain that the price per kilowatt hour that you pay for the heat we supply to you will increase quite substantially. We will let you know of any new rates that will be applied as soon as we’re able to when we are informed.
Energy charge if you pay for the supply of energy for shared services / areas
If you have shared services that use energy and you pay for through your rent or service charge, it’s likely these will increase to reflect the changes in energy prices. For example, shared services would include lifts, communal and door entry for the shared areas of your building. We will be carrying out a competitive tendering process to secure the best utility rates starting from April 2022, however the cost will increase. We will let you know of any increases in the rent and/or service charge notices that are due to be issued shortly and again in 2023.
Support with energy price increase
We understand that these increases will have a huge impact on all households with you having to pay more for energy. You do have options you can explore and there are organisations that can provide help through grants, funds and advice on managing money.
Here are a few things you can try that may help you to manage the effects of the energy price increase:
- Check if the tariff you are on with your energy supplier is the best possible price by visiting a price comparison website as there’s no harm investigating if you can make a saving. Speak to the supplier offering the deal and think carefully before committing to it.
- If your supplier has contacted you to increase your monthly payments (especially if you pay by direct debit), please contact them to discuss. They should only increase your monthly amount if they can justify it based on your consumption.
- Try to negotiate with your utility supplier. While the increase is inevitable for everyone, you should take care not to commit to payments that you cannot afford.
- Seek additional help and support, either from your utility supplier or from an independent source. We have listed some of the agencies that you can contact below.
You can contact us to speak to one of our Welfare & Benefit Advisors on 0300 373 3000 and they can work with you to try to support you getting all the benefits you may be entitled to.
We also have a charitable fund for residents that you can access if you are experiencing financial difficulties. Some residents have received fuel vouchers to help with energy costs. You will need to apply if you would like to receive support from the charitable fund. You can find out more information on our website at Network Homes' Charitable Fund.
External organisations that offer support and advice
- The Energy Bill Rebate - Government discount for domestic electricity customers
To reduce the effect of the increase the Government is providing all domestic electricity customers (residents who pay an energy supplier for their gas and electricity) with a £200 discount on their electricity bill. Energy suppliers will apply the discount to the eligible customers from October this year. This sum is a loan, and you will automatically pay back £40 a year in your bills over five years from 2023. For more information on the discount please visit www.gov.uk.
- Warm Home Discount
You may be eligible to apply for the Warm Home Discount Scheme which can offer up to £140 towards the cost of your electricity. You can do this by visiting: Warm Home Discount Scheme - GOV.UK (www.gov.uk)
- Household Support Fund
The UK Government awarded councils in England a pot of £500 million. Residents who meet the eligibility criteria can apply for funds to cover the purchase of essential items or pay essential household bills. Please check your local council’s website for more information.
- British Gas Energy Trust
You do not have to be a British Gas customer to be able to apply to the charity for assistance if you meet the criteria. You can find out more information about the British Gas Energy Trust at britishgasenergytrust.org.uk. Other utility companies also offer financial support, please check with your supplier for their eligibility criteria.
- Debt Advice and Support
For more information and independent energy and debt advice you can contact any of the following agencies:
- National Debtline - Free, confidential, and independent debt advice for individuals who are not self-employed. Phone 0808 808 4000 or visit nationaldebtline.org
- StepChange Debt Charity - A charity providing free, confidential, and independent debt advice for individuals who are not self-employed. Phone: 0800 138 1111 or visit stepchange.org
- Citizens Advice - Citizens Advice Bureau provide free, independent, and confidential advice to those who are not self-employed on their rights and responsibilities. Phone: 0800 144 8848 or visit citizensadvice.org.uk
We will continue to offer advice and guidance to any resident experiencing financial hardship.
If you are significantly affected by the changes, please get in touch with us or with any of the organisations we’ve listed above for support.