Energy Bills Discount Scheme – Help for Heat Networks
The Energy Bills Discount Scheme (EBDS) provides energy bill support for eligible non-domestic consumers for 12 months from 1 April 2023. Under the new scheme, a higher level of support is given to heat networks with domestic end consumers.
The EBDS replaces the Energy Bill Relief Scheme, which provided support for non-domestic consumers between 1 October 2022 and 31 March 2023.
The new scheme will run for 12 months and provides a baseline discount on wholesale gas and electricity prices for all non-domestic energy customers, with a targeted higher level of support for Energy and Trade Intensive Industries and heat networks with domestic end consumers.
Are you a Heat Supplier?
All heat suppliers that supply at least one domestic end consumer will be required to apply to receive the EBDS discount and to pass on the discount to end consumers.
The heat supplier is the person responsible for supplying and charging for the supply of heating or hot water to an end user through a heat network. Although intermediaries (such as billing agents) will be required to pass through the EBDS benefit, ultimate responsibility will likely remain with the Landlord, unless the Landlord has appointed an operator (e.g. an ESCO) who takes on responsibility for procuring gas/electricity and bills the end consumers directly. Contractual arrangements need careful review to ensure the Landlord's EBDS obligations are met.
How to apply for the EBDS
Organisations need to register on the Government portal to receive the targeted heat network support, expected to be launched in early April by the Department for Energy Security and Net Zero. There will be a 90 day period from scheme opening to apply for the support.
Once verified, the heat supplier will receive a qualifying heat supplier certificate which will be automatically sent to its energy supplier and the discount can then be applied to usage from 1 April 2023.
Heat suppliers with multiple networks will need to submit a separate application for each eligible heat network, which will need to be factored into timescales.
How to prepare
- Billing arrangements: EBDS will apply retrospectively from 1 April 2023. Due to delays in implementing the scheme, it is expected that the EBDS discounts will not be processed until later in the summer. Depending on the site-specific billing arrangements, invoices may need to be reissued or credits applied to cover the period from 1 April 2023. Landlords should review current billing procedures to determine how this will be achieved.
- Communicating with customers: Once the EBDS discount has been processed, there will be an obligation to notify end consumers in writing within 30 days, similar to the previous obligations under the EBRS. Given the likely delay before EBDS support is confirmed, Landlords should consider what additional information they should provide to end consumers regarding the application process and timescales.
- Collate information: Heat suppliers will need to provide specific information in order to register for the EBDS support and should start collating now to avoid missing the 90 day deadline. To avoid delay, ensure you can provide details of the heat supplier, heat network (including the
energy source) and your gas or electricity energy supplier and the meter point numbers (MPRN or MPAN) associated with the heat network.
- Additional verification: Evidence that the heat network has domestic customers is also required– this could include copies of customer supply agreements, metering and billing agreements and/or any other property document that covers the supply of heat or hot water –
as well as a declaration letter signed by a named director (or equivalent) that confirms all information in the application is accurate to the best of their knowledge.
Additional information and access to the application portal can be found on the Department for Energy Security and Net Zero website.
The Energy Bill Relief Scheme (EBRS) applied discounts to energy usage from 1 October 2022 to 31 March 2023. For heat supplied during this period, heat suppliers should have:
- Notified consumers of the EBRS discount and passed through a just and reasonable amount;
- Submitted an EBRS pass-through notification to the Office for Product Safety and Standards (OPSS) by 6 January 2023; and
- Registered with the consumer redress scheme administered by the Energy Ombudsman.
Failure to comply with regulatory obligations could lead to enforcement action by the OPSS, including a fine of up to £5,000. Heat Suppliers should also take this opportunity to review compliance with the Heat Network (Metering and Billing) Regulations 2014 (as amended).
Regulation of the heat network market is expected to be introduced within the next year, as a key part of the Government's Energy Security Bill. With increasing scrutiny on compliance, Landlords should take the opportunity to review existing contractual arrangements and consider how the necessary change in law will be applied.