Energy price cap: proposed changes to Warm Home Discount Scheme cost allowance
- Publication type:
- Consultation
- Status:
- Open
- Publication date:
- Closing date:
- Topic:
- Energy pricing rules
- Subtopic:
- Energy price cap
- Scheme name:
- WHD
Proposed changes to the Warm Home Discount cost allowance in the energy price cap from 1 January 2026 to 31 March 2027 following expansion of the scheme.
Consultation description
We are proposing changes to the cost profile of the Warm Home Discount cost allowance in the energy price cap from 1 January 2026. This proposal follows the UK government decision to expand the Warm Home Discount Scheme half way through the financial year 2025 to 2026. This is to make sure that an extra 2.7 million eligible households get support they need to help with the cost of their energy bills. The UK government is also proposing to extend the Warm Home Discount Scheme after April 2026.
To reflect the increased cost of the expanded scheme we are proposing to bring the remaining cost recovery associated with the financial year 2025 to 2026 expansion forward to 1 January 2026. We are also proposing to extend these costs over a longer period until 31 March 2027.
Background
The Warm Home Discount scheme provides a £150 annual rebate on energy bills to support low-income and vulnerable households.
There are different costs included in the energy price cap. A cost allowance to reflect the costs to suppliers of delivering the Warm Home Discount scheme is one of them. This allowance enables energy suppliers to recover the costs they incur in providing rebates to eligible customers.
Who should respond
We would like views from people with an interest in the level of the energy price cap. We particularly want to hear from:
- energy suppliers
- energy consumers
- industry groups
- consumer groups
- charities
Consultation document
How to respond
Submit your response by 7 November 2025 by emailing retailpriceregulation@ofgem.gov.uk