Government energy help worth about £160 per household in England this year, Treasury estimates
The poorest fifth of households gain around £230 on average, almost four times as much as the richest fifth, once the VAT cut, the £100 rebate and winter payments are added together.
By Daily Oracles News Team2 min read
The help with energy bills the government is giving this financial year adds up to around £160 for the average household in England, according to Treasury analysis published on Tuesday.
The estimate adds together six measures for 2026-27:
- A £100 council tax rebate for homes in bands A to D, the Household Energy Payment, from January 2027.
- £100 million for councils in England to help the households hit hardest by rising bills, with each council deciding how to share it out.
- A cut in VAT on household electricity from 5% to zero, running from 1 October 2026 to 1 July 2027.
- The Warm Home Discount.
- Winter Fuel Payments.
- Cold Weather Payments, using what was spent in 2025-26 as a guide.
The Treasury said the lowest-income households benefit most, both in pounds and as a share of income. The bottom fifth gain around £230 on average, almost four times what the top fifth receive.
It also looked at households in fuel stress, meaning those that spend more than 10% of their income after housing costs on energy. They are estimated to gain £230 on average, compared with £150 for households that are not.
How the figures were built
The numbers come from the Treasury's distributional analysis model, the same one used for its Budget assessment of the effect on households. Income estimates draw on the Department for Work and Pensions' Family Resources Survey for 2022-23 to 2024-25, and spending on energy on the ONS Living Costs and Food Survey. Where a measure could not be simulated household by household, its cost was spread according to where the households that benefit sit in the income distribution.
Two caveats apply. How much is actually paid in Cold Weather Payments this winter will depend on temperatures, so that part of the figure could change. And the analysis covers England only. Separate decisions may be made on support elsewhere in the UK, and some related benefits, such as the Winter Fuel Allowance, are devolved.
