Energy bills: what do Liz Truss’s measures mean for you?

theguardian.com:

The government is freezing energy bills at an average of £2,500 a year for the next two years as part of a big shake-up.

The planned 80% energy bill rise that was set to take effect next month has been scrapped, with the government announcing that a “typical UK household” will now pay no more than £2,500 a year for the next two years from 1 October.

This means the price cap has effectively been suspended – so next year’s planned increases won’t happen either. It had been expected to rise from the current level of £1,971 to as much as £6000.

Ministers say the new “energy price guarantee” will save the average household £1,000 a year, based on what would have happened in October if the government had not acted.

On top of this, all households will still receive the £400 discount on energy bills that the government announced earlier this year, and Truss will also temporarily remove the green levies that contribute about £150 annually to the average bill.

Both of those will push bills down further, bringing costs “close to where the energy price cap stands today”, said the government.

Myron Jobson, a senior personal finance analyst at the investment platform interactive investor, says: “The new measures clip the wings of soaring energy prices and, along with the pre-existing cost of living support package, they will help take the sting out of the cost of living crunch to some degree for vast swathes of the population … But energy bills will remain shockingly high.”

The energy price guarantee will supersede the existing Ofgem energy price cap, and will limit the price suppliers can charge for units of gas.

The government says of the guarantee that it “is automatic and applies to all households”.

The government is basically providing