Parliamentary Warm Homes Group

Parliamentary Warm Homes Group

Tuesday, 02, Dec 2008 04:47


The Problem of Fuel Poverty

A warm dry home is a basic necessity of life, but one which the poorest households in the United Kingdom struggle to achieve. They spend a high proportion of their limited incomes on fuel, but they have still to choose between cold homes or fuel bills they cannot afford.

The principal reason is that far too many homes are poorly insulated and have uneconomic and inefficient heating systems. The consequence is fuel poverty, resulting in misery, ill health and premature death - winter death rates are markedly higher in the United Kingdom than in other countries with colder climates.

The Role of the Warm Homes Group

The Parliamentary Warm Homes Group was established to raise awareness of the problem of fuel poverty and the policies which will eradicate it. It seeks to stimulate debate about the need for long-term investment in energy efficiency improvements and the shorter term need for welfare benefit payments to meet the full cost of adequate home heating. It investigates the potential contribution which can be made by Government, local authorities, landlords, the voluntary sector and fuel suppliers to enable those on low incomes to keep warm at a price they can afford. The Group supported the passage of the Warm Homes and Energy Conservation Act through Parliament, which requires the Government to develop and instigate a strategy to eradicate fuel poverty in England by 2016 and Wales by 2018.

The Issues

Although affordable fuel bills are a struggle for low income households, public policy has been uncoordinated and responsibilities are divided between agencies and departments with different priorities. The Government and the devolved administrations published their strategy to end fuel poverty in November 2001, setting out short-term targets and a range of policy development and funding streams which will be used to deliver the strategy. Key issues to be addressed still include:

  • Landlords and low-income owner-occupiers cannot afford the capital investment needed to make necessary improvements. More flexible and comprehensive packages of measures must be made available via grant schemes for these people.

    Challenge – to create effective schemes, accessible by all fuel poor households.

  • The social security system takes no account of differences in climate or the condition of the property. Benefit levels are the same whether the home was built in the 19th Century or the late 20th Century. Financial assistance via the Winter Fuel Payments to elderly people helps towards the cost of their extra heating needs. Many families and disabled households also require additional assistance to meet high fuel usage.

    Challenge – the long term reality of increased fuel prices and the need for tax incentives to favour renewables must be addressed through the social security systems so that low-income households are not penalized.

  • Fuel companies incur additional costs in dealing with customers with payment problems. As competitive markets developed, low-income consumers became marginalised as the industry targeted the most profitable customers, and special arrangements are starting to be made under Ofgem’s Social Action Plan to ensure low-income and disadvantaged groups also benefit from competition.

    Challenge – to ensure equitable sharing of the benefits of the competitive markets.

  • The use of prepayment meters avoids disconnection, but extra charges are levied for using this payment method. Fuel is priced beyond the means of consumers resulting in hidden disconnection and rationing of supply.

    Challenge – to ensure the fuel poor do not pay more for their energy and cost differentials of payment methods are challenged.

  • Environmental concern to reduce energy consumption may conflict with the need of others for increased warmth to avoid exacerbating health problems. Sustainable energy solutions should be identified and supported.

    Challenge – to ensure the industry regulator addresses equally the social, economic and environmental duties and the role of renewables to assist the fuel poor is explored.

  • The job creation potential and skills training opportunities of a comprehensive national energy efficiency improvement programme must be supported and the skills shortage in the industry must be addressed.

    Challenge – to demonstrate the wider economic gain of delivering warm energy efficient homes to low-income households.

    Please click here for more information on the Parliamentary Warm Homes Group

    • Latest Press Releases

    NEA: Government fuel poverty initiatives are welcome but inadequate

    National Energy Action (NEA), the leading fuel poverty charity, has welcomed aspects of today’s Ofgem and Government fuel poverty action plan, but fears the measures announced will prove inadequate in the context of escalating fuel prices and 4.5 million UK households currently suffering fuel poverty.

    NEA: Additional help for the fuel poor – but not enough?

    National Energy Action (NEA) the leading fuel poverty charity today welcomed the decision by all big six energy suppliers to offer more assistance to their vulnerable customers through social packages but expressed concern at the level of support.

    NEA: You will pay more - that’s a dead cert

    The UK’s leading fuel poverty charity, National Energy Action (NEA), is urging the Government to come clean about the amount of public money the Government is spending on energy efficiency measures for low-income households and who is footing the bill.

    National Energy Action charity backs fuel poverty report

    Leading fuel poverty charity National Energy Action (NEA) has today urged the Government to follow the recommendations of its own advisory group The Fuel Poverty Advisory Group (FPAG).