SFA Utility Recovery Tariff title image

Thursday 1st February 2024

Following the announcement of an increase to energy recharge costs for families living in SFA on MOD supply. This is a reminder that action must be taken on 1st February 2024 to ensure correct charges for consumption.

A letter has been sent to occupants affected by DIO Utilities, it reads:

Dear Family,
We are writing to inform you of an increase in the recovery tariff for the electricity and gas provided to your home. You will be aware of the sharp rise in energy prices experienced over the past 18 months and this tariff increase will ensure that the MOD are recovering the total cost in line with departmental policy.

To help families manage the rise in cost, we have taken a phased approach to the tariff increase. From 01 February 2024 the recovery tariff for your electricity will increase to £0.24 per kWh and gas will increase to £0.03 per kWh. Any remaining increases will be implemented from 01 August 2024.

From 01 August 2024, the tariffs will either be the Ofgem price cap, if one is in place at the time or the price it costs the MOD to purchase – whichever is cheaper. This will ensure you will not be unduly or unfairly disadvantaged compared to families who pay directly to an energy provider, such as British Gas.

The method of recovery for utility charges for all SFA on a MOD supply will soon be a fixed monthly sum1 deducted via JPA that will be reconciled against actual usage on a yearly basis and upon move-out. If the recovery method for your energy usage has not yet changed, you will receive notification by letter of when this change will happen.

To see what the new monthly JPA deductions will be, for frequently asked questions and for information on financial support available, please visit our DIO Utilities homepage on defnet and go to the SFA Tariff information section.

To ensure that you are charged correctly for your consumption, please read your gas or electricity meter2 (or both) on 01 February 2024 and provide this meter reading to us as soon as possible. Please email your meter reading to [email protected]. If an actual meter reading is not provided your usage will be estimated.

For any queries, please contact [email protected].

Yours faithfully,

DIO Utilities

SFA Recovery Tariff Frequently Asked Questions

Why is DIO increasing the recovery tariff on 1 February 2024?

You will be aware of the exponential rise in energy prices experienced over the past 18 months. DIO is therefore increasing the recovery tariff in line with international energy prices to l ensure that MoD are recovering the total cost to the department in line with departmental policy.

What does this increase mean to me?

Your energy bill will be increasing but please be assured that you will still not be paying any more than if you were sourcing your energy direct from a supplier.

Will you be backdating any increase?

No.

How will any Government Domestic Energy price cap be considered?

The recovery tariff will take into account any Government Domestic energy price cap in place at the time so families will not be unduly or unfairly disadvantaged. If the cost of your energy to the department (MOD) is higher than any domestic cap, we will only charge you up to the government domestic cap for your energy. We will also periodically monitor the domestic energy market to ensure the tariff you are being charged remains competitive.

What will the new recovery tariff be?

The rate from 1st Feb 24 for electricity will be £0.24 per kWh. The rate from 1st Feb 24 for gas will be £0.03 per kWh. VAT at 5% is then added to the net (consumption multiplied by per kWh cost).

What if my energy recovery is still via 1571 voucher actioned quarterly via JPA?

Your consumption will be charged at the rates from 1st February 24 and you will shortly receive a letter notifying when your recovery method will change to monthly JPA deductions.

What will the monthly JPA deductions be from 1 February 2024?

The amount to be charged per month is shown below. The amount is based on national average consumption figures for your type of property.

JPA deductions be from 1 February 2024

These rates include VAT at 5%. *If you are unaware of your property type, please check your licence to occupancy or the E1132 system.

What are the current domestic caps?

Energy Price Caps are £0.3032 for electricity and £0.0753 for gas.

What happens if there is no Government Domestic Energy price cap?

DIO will charge based on the total cost to the Department for your energy.

Why am I being asked to provide an actual meter reading from 1st Feb 2024?

This is in order for us to charge you correctly for your consumption up to and from 1st Feb 24 onwards.

If I do not provide an actual reading from 1st Feb what will happen?

The team will estimate what your reading would have been on that date using national average consumption data for your type/size of property.

Does MOD make a profit on providing energy to its SFA occupants?

No, the MOD will only ever recover the amount of money it has cost MOD or lower where a government price cap is in place for domestic energy.

Why are the monthly charges based on national average consumption and not my actual usage?

Due to the number of properties affected, it would not be feasible to produce an estimate for each property based on their actual usage. However, where there is a large discrepancy between national average consumption and known average SFA consumption for that type, we have used the known average.

What if I use more than average consumption as I have a hot tub or car charging point etc?

If you are a higher-than-average user, please let us know by emailing [email protected] so that we can increase your monthly deduction. If you do not let us know, this may mean a large debit amount to be recovered when your account is reconciled.

Why are my charges being reconciled against actual usage on an annual basis and at move-out?

As we will recover your energy usage cost via a set amount each month based on estimated consumption, we must check that you have not overpaid/underpaid and rectify accordingly.

What happens when my account is reconciled?

We will compare your actual usage to the usage you have already been charged for and work out if your account is in credit or debit. We will then inform you by email of the outcome and arrange a credit or debit action within JPA.

Why is the method of recovery changing to monthly JPA recoveries?

It is the goal of DIO to improve efficiency and to save costs wherever possible by digitising processes.

What if I am experiencing issues with my home and its energy efficiency (windows, doors, mould)?

Contact the National Service Centre by email [email protected] or telephone 0800 031 8628.

What if I am experiencing financial hardship?

Your local Unit Welfare team will be able to provide advice and guidance. The following organisations may also be able to assist:

  • The Employee Assistance Programme (EAP) is open 365 days per year – 24/7 helpline – 0800 731 8629 or visit https://mod.workplacewellbeing.com
  • Charity for Civil Servants – https://www.cfcs.org.uk/

MOD welfare organisations contact details:

England, Wales or Northern Ireland support

  • The Royal British Legion has a team of financial advisors on hand who can offer financial support and debt advice to Service families.
  • Step Change is a charity which offers free, impartial debt advice over the phone.
  • National Debt line is a free and confidential debt advice service for people in England and Wales.
  • Debt Advice Foundation is a national debt advice charity available in England and Wales.

Scotland support

  • The Armed Services Advice Project (ASAP) is provided by the Scottish Citizens Advice Bureau and offers debt advice for forces families, dependants and Reserves in Scotland.
  • Step Change Scotland provides free debt advice tailored to your individual circumstances and in line with Scottish debt law.

How can I reduce my energy consumption?

You may find the information provided in the following links useful:

How to save energy and lower your bills this winter (Help for Households)

Actions for saving energy (Ofgem)

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