The National Consumer Council (NCC) and energywatch today warn the government and the energy industry that time is fast running out to eradicate a Victorian affliction that still haunts our affluent 21st century society.
While all eyes are on the government’s imminent energy white paper, and its big-picture plans for future energy policy, almost four million UK households - twice as many as 2003 – struggle to afford to heat their homes adequately.
They need to spend more than 10 per cent of their income on gas and electricity – almost three times the share of everyone else. Poorly heated and insulated homes, high energy prices and low incomes conspire to make their lives a misery – and give the UK one of the worst fuel poverty records in northern Europe. The daily struggle to keep warm and pay their fuel bills is told by victims themselves in a moving NCC short documentary launched today alongside NCC’s blueprint for action to tackle the scandal.
Lord Whitty, NCC chair says:
‘The government’s 2010 target to end fuel poverty in the most vulnerable households is less than 3 years away. There are now three million vulnerable households in fuel poverty and recent cuts in fuel charges cannot, on their own, make that 2010 target achievable. The forthcoming energy white paper must address fuel poverty as a matter of urgency.’
Adam Scorer, director of campaigns at energywatch says:
‘The NCC documentary brings into sharp focus the plight of Britain’s fuel poor and the need for a coherent strategy to tackle fuel poverty.
‘The energy white paper provides government with the last real opportunity to spell out actions to meet its own fuel poverty targets. While discounted ‘social tariffs’ are not a cure-all for fuel poverty, they are a necessary element of any strategic response. energywatch is recommending that the forthcoming energy white paper includes a commitment that all suppliers should provide their most vulnerable customers with the cheapest tariffs.’
NCC’s blueprint for action points out that around 80 per cent of people in fuel poverty live in homes of below average energy efficiency – many of them owner-occupied or privately-rented. And despite the £200 winter fuel allowance, many victims are pensioners.
Lord Whitty adds:
‘Households account for around one-third of UK carbon emissions. So it’s vital to tackle together the social and environmental challenges of both fuel poverty and climate change. Our blueprint isn’t only about ending fuel poverty for good. It’s also about helping save the planet.’
NCC’s research into the causes of fuel poverty shows how energy tariffs and ways of paying fuel bills discriminate against the poorest in society – so many pay more than everyone else. And it says that government should review the financial help offered to disadvantaged and vulnerable consumers to ensure that essential household bills are affordable.
NCC’s blueprint for action includes harnessing 21st century smart meter technology to encourage energy efficiency, and fairer and more affordable tariffs for vulnerable groups. NCC is calling for:
- Smarter tariffs that are fair and affordable, but also encourage energy efficiency.
- Innovative payment methods that meet the needs of consumers – especially low-income consumers.
- Adequate financial help so people most in need can afford to keep warm.
- Better-targeted energy efficiency programmes to simultaneously combat climate change and fuel poverty.
Ends
Notes to editors
First-hand accounts of the daily struggle endured by people who live in fuel poverty are captured in a 10-minute DVD commissioned by NCC – see http://www.ncc.org.uk/responsibleconsumption/video.htm.or phone NCC press office for a copy (0207 881 3018/9). Filming took place in December 2006, January and February 2007 in three UK households living in fuel poverty (in Widnes, Glasgow and London).
The DVD was commissioned by NCC from Plymouth-based Twofour Group http://www.twofourcommunications.com/
A short briefing document on NCC’s blueprint for action to tackle fuel poverty while also reducing the carbon footprint of UK households is at http://www.ncc.org.uk/responsibleconsumption/costing-earth.pdf
A household that needs to spend at least 10 per cent of its income on fuel to maintain an acceptable temperature (21 degrees in the living area and 18 degrees in other occupied rooms) is in fuel poverty. The three main causes of fuel poverty are a low household income, high energy prices and poor energy efficiency of the home.
The average UK household spends 3.6 per cent of its income on energy.
Older people, low-income families with children, and those who are disabled or who have a long-term illness are categorised as ‘vulnerable’. They are most at risk of fuel poverty and are a priority in the UK government’s targets for eradicating fuel poverty.
The government has set targets to end the blight of fuel poverty for most vulnerable households by 2010. There is a later 2018 deadline for eradicating fuel poverty in all UK households.
Many energy companies offer discounted ‘social’ tariffs to specific groups of customers - often pensioners or people on low incomes. Many ‘social’ tariffs are given at the company’s discretion.
NCC’s blueprint for action.
Government must:
- Require the energy regulator, Ofgem, to oblige energy supply companies to deliver social tariffs to help those most in need with their energy bills.
- Review the financial assistance and benefits it offers disadvantaged and vulnerable consumers and to make sure that income support is enough to make essential household bills affordable.
- Expand Fuel Direct to help low-income consumers budget for their gas and electricity and avoid debt.
- Ensure that the next phase of the Energy Efficiency Commitment (EEC) continues to prioritise low-income households and gives suppliers clear incentives to target improvements on the least energy efficient properties.
- Ensure that EEC and Warm Front are more closely co-ordinated and work together to achieve economies of scale.
- Ensure that the forthcoming replacement for the Decent Homes Standard focuses much more on improving home energy efficiency.
Ofgem must:
- Promote best practice on social tariffs and monitor energy suppliers’ claims – acting swiftly to stamp out misleading claims.
- Require energy suppliers to offer a better range of payment methods.
- Commission an independent study into the feasibility of rising block tariffs (charges suddenly rise once a certain amount of energy is used).
- Introduce new measures to incentivise a smart meter replacement programme to be rolled out nationally from 2010 (once current trails are complete).
Energy suppliers must:
- Deliver meaningful social tariffs to help those most in need with their energy bills.
- Equalise all pre-payment meter tariffs with their standard credit tariffs.
- Introduce more consumer-focused and innovative payment methods and ensure these fit with the needs of consumers.
- Engage with government to discuss how improvements in EEC can be geared towards the least energy-efficient homes, and how to identify those homes.
About the National Consumer Council (NCC)
The NCC makes a practical difference to the lives of consumers around the UK, using its insight into consumer needs to advocate change. We work with public service providers, businesses and regulators, and our relationship with the Department of Trade and Industry – our main funder – gives us a strong connection within government. We conduct rigorous research and policy analysis to investigate key consumer issues, and use this to influence organisations and people that make change happen. Check www.ncc.org.uk for our latest news.
energywatch is the independent consumer watchdog for gas and electricity. We provide free, impartial information and advice to energy consumers who are experiencing difficulty in resolving complaints directly with their energy supply companies. We campaign and lobby on energy-related issues. Consumer helpline 0845 9 06 07 08 www.energywatch.org.uk
