Trusts insist continuing energy bill support necessary

21 September 2022 Seamus Ward

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Miriam DeakinThe energy bill relief scheme will operate for six months initially, with a review of the scheme due in three months. This will focus on identifying the most vulnerable non-domestic customers and determining how the government will continue to give them targeted support.

The initial six-month scheme will apply to non-domestic customers, including the NHS, and is similar to the energy price guarantee for domestic users. The relief scheme applies to fixed price contracts agreed on or after 1 April this year, as well as deemed, variable and flexible tariffs and contracts. It will operate for six months from 1 October – customers do not have to do anything as the discounts will be applied automatically in the form of a reduction in the cost per kilowatt hour.

The government said it has set wholesale price ceilings that are less than half the anticipated cost this winter. The supported wholesale price will be confirmed by 30 September, it added.

Miriam Deakin (pictured), interim deputy chief executive of NHS Providers, said trusts would welcome the support as otherwise they would have faced excessive price hikes.

‘Increased gas and electricity costs threatened to be a tipping point for trusts which have already been hit hard by inflation. While many trusts are on fixed energy contracts, which will shield them from significant increases in this financial year, they will continue to be exposed as contracts expire and may face a massive hike in bills from next April without continuing financial support.’

This made the conclusions of the review particularly relevant for the health service.

‘We urge the government to be flexible when reviewing the package of measures and to ensure that all public services are protected from spiralling price rises beyond the next six months.'

NHS Confederation chief executive Matthew Taylor said NHS funding spent on rising energy costs meant less money for patient care.

'We need to understand the exact detail of the government’s support package, but already feel that the review period in three months will be vital as this crisis clearly will not have abated by April. NHS sites need certainty to plan for the future and this announcement does not give them that. The NHS is a 24/7 public service and hospitals, clinics, and GP surgeries cannot simply switch off the lights or turn down the radiators to manage their bills to the extents needed, especially in the depths of winter.'

He added: 'We also need long-term action. The NHS is leading the way in its commitment to net zero. In the context of this energy crisis, we need to redouble our efforts on improving energy efficiency across the NHS.'

 

Public sector support
The government announcement included an example of how the energy bill relief scheme would help a public sector organisation, in this case a school.

It said the school uses 10 megawatt hours (MWh) of electricity and 22 MWh of gas a month. It had signed a fixed contract in July, setting the monthly bill at £10,000. The school is eligible for government support as, at the time the deal was agreed, the expected wholesale price for the period October 2022 to March 2023 was higher than the point at which government support kicks in.

This government supported price is expected to be £211 per MWh for electricity and £75 per MWh for gas, but the figures will be confirmed by the end of the month.

For the school, the difference between the projected price and the government supported price is £240 per MWh for electricity and £70 per MWh for gas, which results in a discount of approximately £4,000 a month.