Martin Lewis has explained how the new £200 energy bill discount will work.
The government introduced the support scheme after Ofgem confirmed the energy price cap will rise 54% in April due to surging wholesale gas costs - as Mirror Online reports.
The Money Saving Expert branded the increase as "sickening" on last week's Money Show Live as the average bill will rise by £693.
READ MORE: Martin Lewis sends grim message to households looking for cheap energy deal
Chancellor Rishi Sunak announced the new measures to ease the financial burden on millions of people across the UK.
Households in England, Scotland and Wales will get a flat £200 bill-credit loan - and energy customers will repay £40 per year from April 2023 for the next five years.
Energy firms should apply the discount from October - and will be loaned the money to do this by the government.
The finance guru shared a video on Twitter to clear up any "misunderstanding" over the process of the new loan system and explained people are not able to opt out of the support.
He said: "In October on every single electricity bill in England, Scotland and Wales, you will either have your bill reduced by £200 or you will be given a bill credit.
"If you're on pre-pay, they will pay it through your smart meter or they will give you a voucher or a cheque.
"That is going to happen, there is no choice in it, it is not optional, it is going to happen automatically on every single bill.
"From the following April and for five years after that, you will then have your bill automatically, without choice, increased by £40 a year."
The finance guru explained that energy customers will still be required to pay back the money even if they move out of the home they live in when the £200 discount is applied.
He said: "There is no personal loan to an individual. This isn't about, you borrowed money, you pay it back.
“So if you're living at home with parents and you move out in two years' time, even though you didn't get the £200, your bill will still be £40 higher - every household will be charged £40 more.
“You'll simply get your energy bill and it will be higher because of this levy and the one this October will be lower.”
Other measures being introduced include a non-repayable £150 council tax discount - and the warm home discount is to rise from £150.
There will also be a discretionary fund of £144m available to those who don't receive the council tax discount.
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