Energy bills: Martin Lewis discusses standing charges
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The cost of living support payment will be paid from October and spread over the next six months. However, how people are paid is down to their energy provider and how they usually pay their energy bills or whether they have a meter.
Typically, if people pay by monthly direct debit, they will get the cash paid into their bank account or as a bill reduction.
Britons who pay after getting a bill will get the cash as credit on their energy account.
People with a smart prepayment meter will get the £400 in instalments as a credit on their meter.
Households with traditional prepayment meters will receive vouchers, which can be used to top up their meter.
British Gas has said the cost of living support payment will be credited to people’s bank or building society account if they pay by direct debit.
However, it has not confirmed plans for people who pay their bills after they receive them or those on smart prepayment meters or traditional prepayment meters.
SSE customers will have a payment debited to their bank account if they pay by onthly direct debit or to their energy account if they pay by standard credit.
EDF Energy hasn’t yet confirmed how it will pay its customers on meters or standard credit but has said people who pay by monthly direct debit will have the money credited to their bank or building society account.
Some eight million people who depend on state benefits will have already received the first instalment of the Cost of Living payment worth £326 in July.
The second instalment of the Cost of Living payment will be paid to people on Universal Credit, Income-based JSA, Income-related ESA, Income Support and Pension Credit claimants in autumn 2022.
However, families on tax credits will have to wait until winter for their £234 payment while the £150 disability Cost of Living payment is due to be paid into people’s bank accounts from September 20, 2022.
How much are cost of living payments?
- £650 one-off Cost of Living Payment for people on means tested benefits paid in two instalments
- One-off £300 Pensioner Cost of Living Payment
- £150 Disability Cost of Living Payment
All customers on Octopus’s standard variable tariff will automatically receive a 4 percent reduction in standing charges on their energy bills compared to Ofgem’s price cap, the company announced this week.
In addition, up to 100,000 customers in greatest need will be able to apply for “standing charge holidays” of up to six months to help them manage the cost of living.
Greg Jackson, CEO and founder of Octopus Energy said: “High standing charges are egregious. This £40million package is the beginning of our battle to bring them down.
“Far too many costs have been loaded onto standing charges – from grid and distribution charges to failed suppliers.”
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