The average gas and electricity bill has risen by £221 to £1,862 per year from July 1, 2026, as Ofgem's new energy price cap took effect. The 13% increase, driven by a spike in global wholesale prices due to the Middle East conflict, means households on direct debit now pay 26.11p per kWh for electricity and 7.33p per kWh for gas. Analysts at Cornwall Insight predict bills will remain high, with a typical household bill of £1,849 from October.
Pension Credit Unlocks £150 Discount
Pensioners claiming Pension Credit from the Department for Work and Pensions (DWP) can automatically reduce their energy bills by £150 through the Warm Home Discount Scheme. Pension Credit provides extra cash to people of State Pension age on a low income and is now worth an average of £4,300 per year following a 4.8% uplift on April 6, 2026.
Under the 2026/27 rates, single claimants can top up their income to £238 per week, or joint weekly income to £363.25 per week with a partner. Qualifying for Pension Credit also unlocks access to further financial support, including the £150 energy bill discount.
Eligibility for Warm Home Discount
Pensioners in England, Wales, and Scotland who receive the Guarantee Credit element of Pension Credit are eligible for the Warm Home Discount Scheme. The scheme provides a one-off £150 discount off electricity bills, applied automatically by the electricity supplier, and is due to reopen in October 2026, with the discount applied by March 31, 2027.
Currently, 28 energy suppliers participate in the scheme, including British Gas, E.ON Next, EDF, Octopus Energy, OVO, and ScottishPower. Eligible customers of these suppliers will receive £150 off their energy bills from October.
Extension and Changes to the Scheme
The Department for Energy Security and Net Zero (DESNZ) confirmed earlier in 2026 that the Warm Home Discount Scheme will be extended in England, Wales, and Scotland for a further five years, to winter 2030/31. DESNZ stated that existing eligibility criteria will be retained in England and Wales, and the current Core Group 1 and 2 will be merged into a single Core Group.
Currently, households in England or Wales qualify automatically (Core Group 1) if they are the named billpayer and receive the Guarantee Credit element of Pension Credit. Those not receiving Guarantee Credit may still qualify (Core Group 2) if they are the named billpayer and receive one of the following means-tested benefits: Housing Benefit, Income-related Employment and Support Allowance (ESA), Income-based Jobseeker's Allowance (JSA), Income Support, the Savings Credit element of Pension Credit, or Universal Credit. From winter 2026/27, these groups will be merged.
In Scotland, the discount is currently automatic only for those receiving the Guarantee Credit element of Pension Credit. From winter 2026/27, Scottish households will get the £150 help automatically if, on the qualifying date in August 2026, they (or their partner) are named on the electricity bill, receive any element of Pension Credit, and receive one of the following means-tested benefits while meeting additional conditions (e.g., having a child under five or receiving a disability-related uplift): Housing Benefit, Income-based JSA, Income-related ESA, Income Support, Support for Mortgage Interest, or Universal Credit. Energy providers in Scotland will also allow some households on certain benefits to apply for the discount, with criteria varying by supplier.
DESNZ said: “The Government will lay regulations for the next scheme period to ensure the regulations are in force ahead of winter 2026/27. This will enable the continuation of the scheme without interruption, securing continued support for around 6 million low-income and vulnerable households next winter and providing certainty for suppliers and delivery partners.”
