Questions remain as alternative fuel payments commence to heating oil users

Earlier this month the government announced the start of alternative fuel payments to domestic and non-domestic users of heating oil but, with end users still raising questions regarding the payment methods and timing, the latest update is shared in full below along with additional advice from industry body UKIFDA.

Clarification of timings and methods for the alternative fuels payment

The Alternative Fuels Payment

As covered in previous updates those using alternative fuels for heating may be eligible for a £200 Alternative Fuels Payment (AFP) if both the following are true:

  • the household is not connected to the mains gas grid
  • alternative fuels are used as the main form of heating

This is in addition to the £400 Energy Bills Support Scheme payment being made to all households in 6 instalments that commenced in October 2022.

Households are eligible for the additional Alternative Fuels Payment if the main fuel used to heat the home is:

  • tank or bottled gas
  • liquid petroleum gas (LPG)
  • oil
  • wood
  • solid fuel

Most homes that are eligible for this payment will get it automatically as a credit on their electricity bills from February 2023.

The payment may not be made automatically if the home is either:

  • in an area which is mainly connected to the gas grid
  • not connected to either the gas or the electricity grid

Payment mechanism for domestic customers

The £200 payments began on 6th February 2023, with most customers receiving the payment automatically as a credit on their electricity bill within the next month.

The government has provided electricity suppliers with a list.

A small minority of customers, including those living in park homes or on houseboats with no direct electricity supplier, and those on the gas grid but without a gas connection and using heating oil, will need to apply to the Alternative Fuel Payment Alternative Fund (AFPAF) via an application portal on the government’s website which is not yet active but applications are expected to open by the end of February.

Payments for non-domestic customers

As of Wednesday, 8th February 2023, payments of £150 commenced for businesses and public and voluntary sector organisations that use alternative fuels to heat their buildings. Electricity suppliers will deliver this support up to 10th March 2023, with most customers expected to receive it during February.

Scam Warning

The government has warned customers to take no action until the online portal launches later in February and that customers will not be asked for details by any individual or organisation before this date or outside of the portal. Any such contact is likely to be a scam.

Further information can be found in the government guidance.

The advice shared by fuel distribution industry trade body UKIFDA can be found here.