Gas and electricity prices are incredibly high this autumn and set to increase again in the New Year. So it’s no surprise that the government’s Autumn Budget has set out a handful of measures designed to provide ‘breathing room’ for energy bills.
We’ve looked into who the changes will apply to, when they will be brought in, and how they will really affect your bills.
Find out more:
- Autumn Budget 2026 key points
- What cost of living support did the government announce in the Budget?
£100 energy payment for households in council tax bands A-D
The standout announcement from the Autumn 2026 budget is a scheme to pay £100 towards energy bills for some homes this winter.
Newly-appointed Chancellor John Healey revealed that households in Council Tax bands A-D will receive a one-off £100 payment ‘directly into their bank accounts’ to deal with rising energy bills this winter.
The payment will be made via your council tax account, rather than through your energy provider.
The scheme will cost the government £2.6bn, and is intended to ‘take the pressure off in the coldest months and see people through to the spring’.
The Chancellor confirmed that the Scottish, Welsh and Northern Ireland governments will receive their share of this funding and are being urged to use it for the same purpose.
Will you be eligible?
The payment will be made to people whose homes are in Council Tax bands A-D.
You can check your council tax band to see if you are eligible for the payment using the GOV.UK Council Tax checker.
You can also see your band on your council tax bills and statements.
The government has said that Local Authorities will be instructed to make these payments starting in January 2027.
Watch out: As always, when these types of announcements are made, it’s important to be vigilant against potential scammers taking the opportunity to confuse those waiting for payments.
If you have a Council Tax account and pay by direct debit, the payment will be made as an automatic rebate directly to your bank account by your Local Authority.
You will not need to provide your bank details.
For those who do not have a direct debit account with your Local Authority, the government is consulting with councils to decide the best way to manage this roll-out, and will release details later in the year.
Electricity VAT cut extended to July 2027
Earlier this year, the new government temporarily removed a 5% VAT from all domestic electricity tariffs, saving a household with typical energy use around £3.60 a month on their total energy bill.
This was due to end on 1 April 2027, but the Chancellor today announced that it would be extended until the end of June 2027, to cover a further three-month period.
The VAT removal is applied to all electricity tariffs, regardless of whether you are paying an out-of-contract, variable rate or are fixed into an energy deal. As all households pay electricity bills (but not all use gas), this measure is the most universal of those announced.
The Chancellor said that the government estimates that the extension will take £50 off the annual energy price cap for a typical household.
However, it’s important to note that it will only be in place for an extra three months. The monthly saving for the same typical household is estimated to be around £4 a month. The increase from the current £3.60 monthly saving reflects the fact that bills for those on out-of-contract, variable tariffs are expected to be higher in the new year than they are now.
Fixing a deal: If you’re currently on an out-of-contract tariff, you are vulnerable to the energy price increases that are predicted in both January and April 2027. But those with fixed tariffs will pay the same amount for the duration of their contract.
See the cheapest fixed deals on the market and sign up to a tariff in our guide to how to get the best energy deal.
Removal of gas standing charges
The Chancellor announced that the government will ask energy regulator Ofgem to remove standing charges from all household gas bills.
The change won’t take effect immediately, though. Gas standing charges will be removed ‘in 2027 or as soon as possible after’.
Currently, all households pay energy bills made up of a combination of unit prices and standing charges for the fuel or fuels you use. You pay the unit price per kilowatt-hour of energy you use, so you can increase or reduce your bill depending on how much you use. The standing charge is a fixed daily payment regardless of how much energy you use.
It used to be possible to choose a tariff with zero standing charges, but these have all but disappeared amid the volatile energy market of recent years.
The current energy price cap for households paying by direct debit has an average gas standing charge of 30p a day, and an average electricity standing charge of 55p a day. The amount you pay in standing charges will be different depending on your region and the tariff you have fixed.
Over a year, this average gas standing charge amounts to £109; for electricity it’s £201.
It’s important to note that the gas cost will not just disappear with the removal of standing charges; instead energy companies are likely to increase the unit rates you pay in order to recoup the costs. In that scenario, households that use less gas would save money, while households with high gas usage may end up paying more.
Households with a high gas demand and a low income may struggle under the new setup. It’s been suggested that there may be support for people in this situation coming down the line.
The Chancellor also suggested that a similar reform would follow for electricity bills, but did not say when this would happen.
Read more on: what makes up the energy price cap
If you are struggling to keep up with your energy bills, let your energy provider know. They are obliged to help you, and you may be entitled to additional support.
Get help and find out more in our guide to: help if you are struggling to pay your energy bills.
Warm Homes Loans now available
Though it was announced earlier in the year, the Autumn Budget included further details about the new Warm Homes Loan scheme.
Interest-free and low-interest loans will be available for homeowners to install heat pumps, solar panels and batteries with no upfront cost.
The maximum you will be able to borrow for each type of technology is:
- solar panels – up to £15,000
- electrical storage battery – up to £15,000
- air-to-water source heat pump – up to £20,000
- air-to-air source heat pump – up to £10,000 (when MCS certification available)
- ground source heat pump – up to £35,000
- biomass boiler – up to £20,000
- heat network connection – up to £7,500
- micro-renewable system – up to £20,000
Households across England, Northern Ireland, Scotland and Wales can apply for the government-backed loans which, it says, have up to 5% cheaper interest rates than those offered by banks or high street lenders. Repayment terms are up to 30 years.
Ten lenders are offering loans so far:
- Homeserve (partnering with E.On)
- Hometree Finance
- Propensio Secure
- Trust Bank
- Selina Finance
- South Manchester Credit Union
- Sunsave
- Tandem Bank
- The Money Co-op
- This Bank
You can combine a loan with a grant of up to £9,000 through the government’s Boiler Upgrade Scheme (see below).
You’ll need to choose an installer certified by the Microgeneration Certification Scheme (MCS) to qualify for a loan. Some lenders will let you choose any MCS-certified installer; others partner with specific installers only.
If you’re considering installing renewable technology, find out are solar panels worth it, what it’s really like to have a heat pump and about different heating your home with renewable energy.
Boiler Upgrade Scheme grant
Grants of up to £9,000 towards the cost of replacing your gas, oil or LPG home heating with a heat pump or biomass boiler are available in England and Wales.
This wasn’t a new announcement in the Autumn 2026 Budget. But the budget revealed that £1bn will be cut from the Warm Homes Plan, of which the Boiler Upgrade Scheme (BUS) is a part.
The BUS will get the same funding this year and into 2027-28, but then it will rise broadly in line with inflation.
That means that there will be less funding in future for heat pumps than had previously been expected.
FInd out more about the Boiler Upgrade Scheme and how to apply.
Debt Relief Scheme
One-off targeted support will be available next spring to help households struggling with energy debt built up during the energy crisis between 2022 and 2024.
Around 2.4 million customers who are in debt to their energy supplier could be eligible for the support.
Help will be available for people in the following groups, according to energy regulator Ofgem:
- pensioners
- those on disability benefits
- those on means-tested benefits.
Customers who get support will have to work with their energy supplier and take steps to help stop debt building up again. The most vulnerable households, or those in the greatest financial hardship, will still be safeguarded, Ofgem said.
Find out how to get help if you are struggling to pay your energy bills and more advice about how to deal with debt.
