The government said that 900,000 households in England, Scotland and Wales would be able to apply online from the start of the new year to obtain £400 in support – matching what is being paid out to millions of households with a more traditional energy set-up.
The support will extend to the 900,000 households in Great Britain that do not have a direct relationship with an energy supplier, allowing Travellers access to the cash for the first time.
In addition, all households in Northern Ireland will receive a one-off payment of £600 to help with their energy bills, with payments starting in January. Households in Great Britain that use alternative fuels such as heating oil will receive a £200 payment.
"Putin's illegal war has caused global energy prices to soar, but we are continuing to work hard and urgently to get help to households across the UK, and this update provides people with more certainty on when and how we will deliver help with fuel bills," said business and energy secretary Grant Shapps.
The support comes on top of the energy price guarantee, announced under Liz Truss's government, which caps the price that a household pays for electricity at 34p per unit and 10.3p for a unit of gas.
For a household using an average amount of energy, this will mean an annual bill of around £2,500.
The decision is a response to the UK's deepening cost-of-living crisis, that has seen inflation hitting historic levels. The rising prices of energy bills – prompted by the Russian invasion of Ukraine – is the main catalyst for this situation, which could leave as many as 40 per cent of British families facing fuel poverty this winter.
With the latest announcement, the government is reportedly aiming to support those citizens that had been left out of previous energy bill relief support schemes, due to their less traditional relationship with energy suppliers.
"We're already limiting the amount suppliers can charge consumers for their energy through the Energy Price Guarantee, which will continue to help consumers through to March 2024," Shapps said.
"We've all seen and felt the temperature dropping recently, so today's updates will help millions worry less about their energy and heating bills this winter."
Payments of the £400 to households without a direct relationship with a supplier will be made through local authorities across Great Britain, with online applications due to open in January, the government has said. There will also be a helpline for those without internet access.
"Getting this support for households' bills out across the country will save hundreds of pounds for millions of people during the coldest months of the year," said Graham Stuart, minister for energy and climate.
"This has been a top priority and joint effort, with close work between officials and electricity suppliers in Northern Ireland, as well as with local authorities in Great Britain, who will help get support to over 900,000 households who don't have the direct relationship with energy suppliers that the vast majority of households do."
