Some 29mln British households will start to receive energy bill discounts from this October, with the UK government offering a £400 discount across households in England, Wales, and Scotland.
There will be a deduction of £66 from bills in October and a deduction of £67 from December to March next year, the government announced in a statement setting out the details of its Energy Bills Support Scheme.
The non-repayable discount will be made in six instalments and will be administered by energy suppliers who will be responsible for passing on the credit through the monthly bill.
Every month, traditional prepayment meter customers will receive energy bill discount vouchers via SMS text, email, or postal mail.
For those who pay for their energy via credit, debit, or payment cards, a deduction will be made automatically from the bills.
Chancellor Nadhim Zahawi said the discount was part of a £37bn package of support for households, including £1,200 of direct support for 8mln of the most vulnerable households.
Dual-fuel tariffs were predicted to rise to £2,800 on average and are now forecast to touch £3,244 in October when energy regulator Ofgem's next price cap takes effect.
Following reports that energy bills may top £4,000, anger was directed at record profits for both Shell PLC (LSE:SHEL, NYSE:SHEL) and British gas parent company Centrica PLC (LSE:CNA).
"People across the country are understandably worried about the global rise in energy costs, and the pressure this is placing on everyday bills," said Kwasi Kwarteng, the business and energy secretary.
"While no government can control global gas prices, we have a responsibility to step in where we can, and this significant £400 discount on energy bills we’re providing will go some way to help millions of families over the colder months."
Martin Lewis, a consumer advocate, said Liz Truss and Rishi Sunak, the two candidates for the leadership of the Conservative party, needed to agree on a consumer package to help consumers.
Lewis added Boris Johnson's "zombie government" failed to deal with the crisis caused by rising energy bills, and Johnson's successor could not delay decisions on support.
As the energy price cap rises to £3,500 or more in October, Lewis, the founder of Money Saving Expert, said households would begin receiving notices of increased bills even before the Tory leadership contest is over.