Warm Home Discount consultation begins
The Department of Energy and Climate Change (DECC) has given details of their Warm Home Discount, which was announced in the Spending Review.
The new mandatory scheme will replace the voluntary agreement with energy suppliers to provide better focused help to vulnerable consumers.
A consultation has been launched to decide on the detailed structure of the support scheme, who will be eligible and how they will be targeted.
Up to £1.1 billion will be used over a four year period to help around two million households.
Energy companies will be obliged by law to give a discount on energy bills to more of their most vulnerable customers, such as pensioners, those on low incomes and people with long term illness or disability.
The help will be in the form of a discount of up to £130 of electricity bills.
Energy secretary, Chris Huhne said: "Warm Home Discount does exactly what it says on the tin, in providing money off vulnerable households' energy bills to help them afford their heating.
"We're requiring energy companies to do this by law, but first we need to get the detail right.
"Warm Home Discount is a practical way to provide tangible financial help on energy bills to more of the most vulnerable."
The Voluntary Agreement between energy suppliers and the government ends in March and the new mandatory scheme would involve transitional arrangements to allow the companies to manage their spend.
This winter, the Winter Fuel Payment will remain at the higher rate of £250 for households with someone aged up to 79 years old and £400 for households with someone aged 80 or over.
Cold Weather Payments of £25 per week will continue to be paid to pensioners on Pension Credit and people on income-related benefits.
The consultation closes on 14th January 2011. Alison Brown