Every UK home to get £400 off energy bills – how the payment will work explained 

Every home in the UK will get £400 off their energy bills as part of plans to tackle the cost of living crisis, Rishi Sunak has confirmed. 

The new support comes instead of the £200 energy discount people were due to receive from October.

The £200 discount had been much-criticised and labelled as a “loan” as the money would’ve needed to be paid back.

The Chancellor today confirmed he will turn the £200 “loan” into a grant – meaning struggling households will not need to repay it.

Mr Sunak will also increase the amount you’ll get off your bill by an extra £200, taking the total discount to £400.

He confirmed the new £400 payments this afternoon in the House of Commons, as part of a wider £15billion cost of living package partly funded by a new windfall tax on energy firms.

But the new support is still only half of the £800 the boss of Ofgem warned its price cap will increase to this October.

The price cap for those on default tariffs paying by direct debit increased by £693 from £1,277 to £1,971 last month.

Jonathan Brearley, the chief executive of Ofgem, warned this could rise to £2,800 in October.