Commentary on provisions of Act Reduction of domestic energy bills in England, Wales and Scotland Section 1: Domestic electricity and gas price reduction schemes for Great Britain
This section gives the Secretary of State power to establish the Energy Price Guarantee (EPG) schemes for electricity and for gas. Such schemes have already been established and operational from 1 October under contracts ("Scheme Documents") with suppliers entered into on a voluntary basis. 1 The provisions in the Act will put the schemes on a more secure statutory footing. This includes by requiring suppliers to apply to join, remain in and comply with the schemes, and for Ofgem to enforce any non-compliance.
	Subsections (1) and (3) confer the powers to make the schemes. Subsections (2) and (4) define what the schemes are.
	Subsection (5) refers to how the scheme reduction may operate. The current Scheme Documents provide, in high level summary, that:
the Secretary of State will set the level of and pay financial support to electricity and gas suppliers to allow them to make reductions to the energy unit prices charged to consumers;
suppliers must pass to consumers, by reducing on a per kilo Watt hour (p/kWh) basis, the tariffs which would otherwise be charged, the whole of the support payments made to suppliers under the schemes.
	Subsection (6) provides that the Secretary of State may amend or revoke a scheme, for instance to change the eligible tariffs or the support rate. The Scheme Documents between the Secretary of State and energy suppliers already give the Secretary of State the ability to make, modify and end the scheme.
	Subsection (7) constrains the statutory modification power, so that it must be used consistently with the terms outlined in the Scheme Document.
	Subsection (8) provides an exception to subsection (7) where the Secretary of State modifies the Scheme Documents to prevent profiteering. In such circumstances they need not comply with the terms on modification set out in the scheme.
	Subsection (9) refers to the sunsetting provisions in Schedule 6.