News - Page 5 of 23 - End Fuel Poverty Coalition

Surge in energy disconnections and debt

New figures from Ofgem have revealed that the number of customers disconnecting from the grid have surged – along with levels of energy debt.

The data shows that in quarter 1 2023, people disconnected from their energy supply more than 5 million times. Almost 1.2m customers were affected with over 800,000 bill-payers disconnecting for more than three hours.

Meanwhile, official energy debt levels have also surged.

The average household energy debt for homes not on a payment plan, is £1,214 on electricity bills and £965 on gas bills. Figures from the Money Advice Trust suggest that this “bad debt” is just the tip of the iceberg.

A spokesperson for the End Fuel Poverty Coalition commented:
“This is exactly what we have been fearing. As Bank of England figures show, people have burned through savings just to keep up with essentials and the cost of living crisis continues. Meanwhile average energy debt is surging to unprecedented levels

“It’s clear that households are just unable to cope.

“The majority of this debt is caused by the record high energy prices which have caused misery for millions, but generated excess profits for the firms involved in Britain’s broken energy system.

“Rather than end the Windfall Tax early, as the Government plans to do, it should instead look at how this could be used to help get those people suffering back on an even keel.

“Calls to introduce a Help to Repay debt matching scheme are backed by a range of charities. These plans would help reduce levels of fuel poverty as well as helping wider household finances.”

The figures come as the Ofgem Price Cap brings the average annual energy bill to customers down to around £2,074 from 1 July 2023. The Price Cap affects 29 million customers on standard variable tariffs (SVTs), including around 4 million customers on prepayment meters (PPMs).

Despite a slight reduction in bills from 1 July 2023, these customers will have energy bills that are double what they were in 2020 and 60% above what they were before the invasion of Ukraine.

This means that customers will continue to pay similar amounts for their energy as last winter, but with people having less ability to pay as the cost of living crisis continues.

Older people’s ‘parliament’ debates energy crisis

The 2023 National Pensioners’ Annual Convention has heard a stark warning that millions of vulnerable people will be unable to stay warm this winter.

Last year, over 9m adults lived in Dickensian conditions unable to keep their homes warm and damp free. The figures for the Warm This Winter campaign, also revealed that over 1m of these adults were older and those with disabilities were especially vulnerable to living in cold damp conditions.

From 1 July energy bills will be roughly the same as last winter and while some reduction in the Ofgem price cap may come through before winter 2023/24, the Convention heard that this would still mean energy bills are double what they were in 2021/22.

New figures from Age UK and the ONS reveal that almost half (45%, 11.3 million) of people aged 50+ in Great Britain are currently finding it difficult to afford their energy bills.

Addressing the meeting in Blackpool, Simon Francis, coordinator of the End Fuel Poverty Coalition, said:

“At a recent meeting with pensioners, one told me that the only change between their living conditions in the 1940s and those of today was that they had an inside toilet now. They said that the poverty they experienced as a child is what they are now experiencing again.

“Food banks, sanitary banks, pet food banks and massive government support for energy bills are the only things keeping people from destitution.

“We cannot allow this to continue any more and the Government needs to act to keep people warm this winter and every winter. We can only do this through debt relief and financial support now alongside a rapid programme of energy efficiency improvements and speeding up the generation of cheap renewable energy and moving us away from the fossil fuel profiteers of the past.”

Delegates representing the National Pensioners Convention’s 1.1 million UK members have met at The Imperial Hotel in Blackpool to discuss why millions of today’s – and tomorrow’s – older people face poverty, hardship and the loss of vital services.

NPC General Secretary Jan Shortt said:

“The last few years have been particularly tough on our oldest and most vulnerable.

“Hundreds of thousands died in the pandemic, and millions now struggle to make ends meet as prices rocket, while the real value of pensions drop. Older people are having to choose between eating and heating, while the essential services they rely upon, from health and care to housing and transport, continue to decline or disappear completely.

“This isn’t just a problem for older people now, it is a major issue for today’s workers who wonder if they’ll ever be able to afford to retire. Especially if the government pushes back the retirement age to 68 and threatens to scrap the Triple Lock that should guarantee state pension cost of living increases.”

Other Convention speakers will include Robert Palmer from Tax Justice, John Lister from Keep Our NHS Public, Lord Davies of Brixton on the future of the state pension, and Tom Lowe from the Digital Poverty Alliance on the exclusion of older people from our increasingly online world. Leaders from national organisations like Age UK, Independent Age, Ageing Better, as well as the TUC, Unite and UNISON will also be attending.

Poorest constituencies missing out on support for energy bills

New analysis of Government data by the End Fuel Poverty Coalition has revealed that some of the poorest constituencies in the country had some of the highest levels of undelivered or unredeemed payments through the Energy Bills Support Scheme. [1]

Westminster Constituency-specific data shows that some of the constituencies with the highest levels of child poverty were the least likely to get the full amount of support payments that they were owed.

In Brent Central, where more than a third of households with children are in poverty [2], more than one in twenty (6.18%) of vouchers were not delivered or redeemed.

Meanwhile in Liverpool Riverside, more than 22,000 (5.19% of payments) were not processed, even though more than 7,000 families are in poverty.

The latest UK-wide figures show that millions of pounds worth of support has not made it to the households that it was meant for, with the majority of that due to those on prepayment energy meters (PPMs).

In the constituency of Hampstead & Kilburn, 43% of vouchers issued to PPM households have not been redeemed. And while the problem is worst in London, other places across England have also been hit hard. In Bradford West, a third of vouchers are still to be claimed, in places such as Preston or Pendle, the figure is 29%.

Scotland’s voucher redemption rate (26% left unclaimed) is worse than everywhere else in the UK apart from London (32%). Constituencies such as Edinburgh East, Edinburgh North & Leith, Glasgow North (all 36%) and Inverclyde (35%) all have low take up rates.

The government provided households across the country with £400 of energy bills support from October 2022 until March 2023 through the Energy Bills Support Scheme. For traditional prepayment meter customers, this support came in the form of vouchers delivered monthly by text, email or post.

The deadline to collect any missed payments is 11.59pm on 30th June.

A spokesperson for the End Fuel Poverty Coalition, which is part of the Warm This Winter campaign, commented:

“Far too often support payments under this scheme have not found their way to vulnerable households. There is now less than a week to go before this support will be lost to households forever.

“If anyone feels they have missed out on Energy Bills Support Scheme payments they should contact their energy firm immediately.”

Frazer Scott, CEO of Energy Action Scotland commented “Over 1 in 3 households in Scotland are in fuel poverty and are struggling to access heat and power to maintain their health and wellbeing. Energy debt levels are rising yet vital support is not reaching people. Legacy prepayment meter households should be receiving the support to which they are entitled. It isn’t right and it isn’t fair that so many voucher remain unredeemed.”

Jonathan Bean of Fuel Poverty Action said: “As usual in our cruel energy system, those that need the help most are not getting it. Government and energy firms are failing vulnerable people again. Extra time and effort is needed to sort out this mess.”

ENDS

[1] End Fuel Poverty Coalition analysis of official Government data published on 20 June 2023. All data is available to download from: EFPC EBSS Calculations energy-bills-support-scheme-gb-payments-june-2023

[2] End Child Poverty Coalition / Loughborough University data https://endchildpoverty.org.uk/child-poverty/

Call for Help To Repay scheme as energy bills debt soars

An estimated 5.5 million UK adults are now in energy bills debt, according to new research from the Money Advice Trust.

The latest findings confirm the heavy toll that high energy bills are taking on household finances with 2.1 million more people in energy arrears in April 2023 than in March last year and millions struggling to access help from their energy suppliers.

The figures are also more than previous data from the Warm This Winter campaign suggested earlier this year.

In the wake of the research, the End Fuel Poverty Coalition has joined forces with Money Advice Trust, StepChange Debt Charity, Warm This Winter and other organisations to ask the Secretary of State for Energy Security and Net Zero to set up a ‘Help To Repay’ repayment-matching scheme.

Campaigners believe this will provide a safe route out of debt for struggling households.

The Money Advice Trust research finds that millions more households were struggling with their energy costs in April than in March 2022, with support from energy suppliers – which is vital to help them repay arrears – proving difficult to access.

While support is available from energy providers for people who are struggling, an estimated 3.9 million people (7 percent) said they have not been able to access help for their bills after contacting their suppliers for support.

A further 3.2 million people (6 percent) reported not being able to get through and contact their supplier for help when they had tried to do so.

Joanna Elson CBE, chief executive of the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said:
“Energy bills might finally be falling – but for millions of households, the effects of this cost of living crisis are already baked in. With more people falling behind on energy and other essential bills and millions facing unaffordable demands for repayment, we need urgent action to make sure everyone has access to a safe route out of debt.

“The government has already provided substantial support to help with the cost of living – but no-one should underestimate the scale of this continued crisis.

“The Help To Repay payment-matching scheme we are proposing will help those who otherwise will simply not be able to dig themselves out of the energy arrears that this crisis has created. And for those most in need, the government should introduce an Essentials Guarantee to link the rate of Universal Credit to cover the cost of essential goods like food and energy.”

A spokesperson for the End Fuel Poverty Coalition commented:

“Energy debt is surging to unprecedented levels and it’s clear that households are just unable to cope.

“The majority of this new debt is caused by the record high energy prices which have caused misery for millions, but generated excess profits for the firms involved in Britain’s broken energy system.

“Rather than end the Windfall Tax early, as the Government plans to do, it should instead look at how this could be used to help get those people suffering back on an even keel.

“Not only would this help reduce levels of fuel poverty now and into next winter, but it will also help wider household finances, ensuring people no longer have to cut back on essentials.”

Research by the University of Bristol has found only 26% of households have not had to take measures to cut back on spending and the majority of people are now taking steps to cut costs in one or more areas.

A third (35%) were not able to afford a healthy balanced diet at least once in the past month and one in five of those in serious financial difficulties had not eaten for a whole day at least three times during the last month.

Free, expert advice is available from charity-run services like National Debtline.

Full detail of the Help To Repay proposal submitted to the Government can be read online: https://moneyadvicetrust.org/media/documents/Help_to_Repay_-_Energy_arrears_scheme_proposal.pdf

Awareness week set to celebrate renewable ways to end fuel poverty

The Great Big Green Week (10th – 18th June) is a UK-wide celebration of community action to tackle climate change.

While the energy industry lobbies for the continuation of oil and gas, including opposing the Windfall Tax on excess energy firm profits which is used to tackle fuel poverty, experts have predicted that renewable energy sources completely replacing fossil fuels by 2050 will save trillions of dollars globally.

Labour has announced plans to block all new oil and gas development in the North Sea if they are elected, in a move which has been welcomed by 139 organisations including the End Fuel Poverty Coalition. These organisations have signed an open letter to Labour leader Sir Keir Starmer urging him not to U-turn on this policy, citing the importance of investing in renewables in ensuring that the UK has secure access to affordable and green sources of energy.

The Government is also examining how best to reform of electricity marketing and pricing which calculates how electricity costs are determined. Currently, costs per unit are calculated by “marginal pricing”, meaning that the price per unit (kWh) of electricity is determined by the last energy source delivered onto the grid to meet demand in any given half hour period. In practice, this is often determined by the cost of energy from expensive gas power stations, rather than cheaper renewables.

The End Fuel Poverty Coalition responded to this consultation by urging the government to unlink the cost of energy from gas prices, and better factor in renewable energy to help mitigate price volatility and drive energy bills down.

Community schemes are becoming vital ways to promote renewables at a local level. One such scheme is Net Zero Now in South Cambridgeshire, which is a free training programme for local residents. The scheme is designed to support individuals to act on climate change in their community, and consists of six weekly workshops where attendees learn from each other to deliver effective carbon reduction activities, events and communications. Local schemes such as this one are being celebrated during Great Big Green Week, as it has been found that these programmes help to lower emissions and restore nature within communities.

A spokesperson for the End Fuel Poverty Coalition commented:

“The Great Big Green Week asks us to think about what inspires us to tackle climate change and protect nature. For millions of people, the answer is that tackling climate change is also how we end fuel poverty in the long run. We already have solutions ready to do this. For example, reforming the energy grid and adopting renewable energy sources will contribute to the achievement of net zero, but would also mean more affordable bills. Additionally, improving our homes to be more energy efficient could reduce heating bills by 20%.”

Plans to axe energy Windfall Tax branded premature

The Government has set out plans to wind down the Windfall Tax on energy firms in response to demands from the industry.

Analysts from Uplift told Sky News that the introduction of this price floor will further undermine an already weak windfall tax and paving the way for further oil and gas extraction.

The Energy Profits Levy already contained a loophole which could have helped tackle fuel poverty last winter, as well as acting as a handout to the fossil fuel industry with the UK government expected to give highly profitable oil & gas companies £11.4 billion in tax breaks to develop new fields.

A spokesperson for the End Fuel Poverty Coalition, commented:

“Energy bills are predicted to remain high and levels of household energy debt are still surging.

“Any talk of reducing or ending the windfall tax while millions still struggle through the energy bills crisis is premature.

“The Government should keep all options on the table to ensure the funding is available to fix Britain’s broken energy system into the long term.”

The decision has been described as shortsighted in light of the lack of long-term certainty about energy bills and Greenpeace UK’s climate campaigner, Georgia Whitaker, said:

“The Government’s windfall tax on oil and gas companies already contains more loopholes than a block of Swiss cheese. And now they want to scrap it altogether.”

Majority of Brits oppose hydrogen heating trials

Just 15% of surveyed Brits would choose to take part in hydrogen heating trials, with almost three in five rejecting the idea outright, according to a new poll, commissioned by the Warm this Winter campaign.

It comes as parliamentarians continue to discuss the passage of the government-backed Energy Bill that would legislate for the creation of trial “hydrogen villages” at proposed towns, including Whitby and Redcar in the north of England.

Residents in both towns have voiced concerns about being forced to take part amidst warnings of long-term extra cost and heightened risk of explosion. These were also concerns topping a list of worries respondents to the poll have about hydrogen heating.

Just under half said they are concerned about the fact that hydrogen is four times as explosive as gas, and (46%) said they were worried that it could add costs to bills.

Cornwall Insight found that hydrogen could add on average 70% to bills from 2025. Home appliances will also have to be changed to accept this new fuel, with cautious estimates suggesting it would cost approximately £171 billion to convert appliances and infrastructure to hydrogen across the UK.

A recent Global Witness briefing pointed out that as well as issues over cost and risk, hydrogen will also do nothing to help the climate crisis, despite industry attempts to paint hydrogen heating as a climate solution.

While the Government is trying to reintroduce a levy on customer bills to pay for hydrogen projects in the Energy Bill being debated by MPs, just 3% of poll respondents would want to see hydrogen heating paid for through energy bills. Over two thirds (67%) wanting energy companies to foot the bill for any costs related to hydrogen heating.

Alice Harrison, Fossil Fuels Campaign Leader at Global Witness, which is part of the Warm This Winter campaign, said:

“This polling makes it fundamentally clear that the fossil fuel industry is losing its battle to hoodwink the public into thinking hydrogen heating is a worthy solution to either the climate or energy crisis. People are rightly concerned about the risk of explosion and associated costs, particularly as hydrogen heating will not stop climate breakdown – in fact it could worsen it.”

“The absolute hammer blow for hydrogen heating is that, given the choice, the majority of people surveyed would reject taking part in the trials. Add this to the wave of opposition at proposed trial sites, any government pursuing this reckless agenda would be at best out of touch, at worst running foul of democracy. Hydrogen heating has no place in the Energy Bill.”

A spokesperson for the End Fuel Poverty Coalition commented:

“Hydrogen is not the solution to keeping people warm in the winter. Used in the home it is explosive, expensive and damaging to the environment as it is currently produced.

“MPs should keep in mind how unpopular this policy is with the public who can ill afford any more unnecessary increases to their energy bills.”

Public urged to claim energy bills vouchers before June deadline

The government is urging UK energy customers with a prepayment meter (PPM) to redeem any unclaimed Energy Bill Support Scheme vouchers before they expire at the end of June.

Claim Your Energy Voucher day takes place on May 31, and marks one month until unredeemed vouchers are due to expire.

Previous data revealed that in some areas of the country more than 1 in 20 payments were not delivered or claimed during the scheme.

The latest government data shows that energy firms still owe £130m to households through unredeemed PPM vouchers.

A spokesperson for the End Fuel Poverty Coalition commented:

“We’ve been calling on the government for some time to rectify this situation and ensure that every household receives the support that they are owed.

“We are delighted that they are listening, and we urge every PPM customer to double-check that they received and redeemed their full £400 in vouchers during the scheme.”

The Government advises that if customers have their vouchers already, they must take their ID and vouchers to a Post Office or Paypoint to redeem them before June 30.

Those on a traditional prepayment meters who have not received the vouchers, or are unsure of how to redeem them, or need a voucher to be reissued, should contact their energy supplier.

Households using prepayment meters who use alternative fuels such as LPG, heating oil or biomass as the main way they heat their homes also have until June 30 to use their vouchers worth up to £200 in energy bills support.

Other households who are due support through an “alternative method” (such as those in park homes or on care home complexes) have also to apply for the scheme, with the Mirror revealing that just 13% of eligible households had applied.

Price cap warning as Ofgem set summer bills

Millions of domestic energy customers will see their energy bills stay at near record highs.

The latest Ofgem Price Cap announcement has set new prices for what consumers will pay for energy from 1 July 2023, with the average household seeing an energy bill of £2,074. If customers use more than the average consumption, they will still pay more than this figure as the cap limits the unit cost, not the total bill.

Up until as recently as March, the average household energy bill stood at £2,100 due to the impact of Government support programmes. Last summer, average bills were £1,971 meaning energy will be 5.23% more expensive in summer 2023.

Predictions are that future price caps will set average energy bills at £1,976 from 1 October and rising back to £2,045 from 1 January 2024.

According to End Fuel Poverty Coalition records, this means that energy bills will be roughly:

DOUBLE what they were in 2020.
60% ABOVE what they were before the invasion of Ukraine.
At a similar level to last winter, but with people having less ability to pay as the crisis continues.

Anne Vivian-Smith, a disabled former community worker from Nottingham, said:

“Last winter I couldn’t keep myself warm as energy bills soared. To learn that I might have to face the same level of energy bills again is a frightening prospect. Other bills have gone up and the cost of living has soared – we’re less able to pay our bills now than we were last winter.”

Junnie Braithwaite is 56 and lives in northeast London. Her socially rented apartment is split over two floors, and she needs to use a stairlift because of fibromyalgia and arthritis. She said:

“It’s give with the one hand and take with the other, I might get a few quid off my energy bill but that’s swallowed up by food prices going through the roof. I still don’t have peace of mind and I am already dreading next winter when my energy bills will go up again.”

A spokesperson for the End Fuel Poverty Coalition commented:

“The sting in the tail to this announcement is that customers are still going to be paying roughly the same for their energy as last winter.

“And after months of inflation and the wider cost of living crisis, people are even less able to afford these high energy bills.

“The government needs to use the summer to fix Britain’s broken energy system, because for millions of people the energy bills crisis is far from over. This means ramping up energy efficiency programmes, helping the public with energy debt and reforming energy pricing arrangements so people don’t suffer again this winter.”

Research for the Warm This Winter campaign found that over 9 million adults lived in cold damp homes in winter 2022/23 and official figures showed cases of hypothermia surged by 36%.

Tessa Khan, Director of Uplift which is part of the Warm This Winter campaign, commented:

“Britain’s broken energy system is set to cause another winter of misery, with fuel poverty affecting many of the most vulnerable. But as people continue to struggle through the energy bills crisis, the energy producers will continue to reap record profits.”

Fixed term deals which may now come onto the market may not be the solution, with recent figures from Future Energy Associates show that these may boost energy firms’ profits and be more expensive to consumers than the standard variable tariff.

The Government has announced funding to help with the cost of living, but it will not help around 1.7 million households in fuel poverty and represents a real-terms cut in support compared to last year.

Other inequalities in the energy market will remain with customers paying by standard credit (i.e. paying by cash, cheque or bank transfer) hit with a significant price premium.

Meanwhile some regions, such as Merseyside and North Wales will pay substantially more than others, such as those in the East Midlands.

Bethan Sayed from Climate Cymru said:

“The regional inequalities are deeply unfair, with people in North Wales paying substantially more than other parts of the UK for their energy. This is compounded by people living in old, leaky homes or off grid, and those on prepayment meters getting less energy for their money. This needs to change.”

Jonathan Bean from Fuel Poverty Action added:

“As people sink deeper into debt, basics like washing your clothes are becoming unaffordable luxuries for many. We need long-term solutions to fix Britain’s unfair energy system, such as providing a free ‘energy for all’ allowance for those that need it.”

Energy firms cash in on cost of living crisis

Energy firms have been cashing in on the energy bills crisis as Shell has held its AGM.

In the first three months of the year alone, Shell made a profit of more than £7.6bn. BP have also recorded bumper profits, enjoying one of the company’s best ever starts to the year. Despite the windfall tax, energy firms have still been able to profit from the misery of people living in cold damp homes.

National Grid, the firm which runs the energy network, similarly reported a boost in annual profits to £4.6bn. This had led to calls for a higher windfall tax for energy companies.

Scotland-based energy firm SSE’s profits have also rocketed to £2.53bn.

To put these profits into context, Energy UK estimated that the current energy debt in the UK has soared to around £3.6bn. Profits from the National Grid alone could completely wipe out energy debt for the entire country.

Meanwhile, a groundbreaking report from One Earth has calculated that fossil fuel companies owe at least $209bn in annual climate reparations to compensate communities which are suffering climate catastrophes as a direct result of global warming.

A spokesperson for the End Fuel Poverty Coalition commented:

“The scare stories from industry about the impact of the windfall tax on energy firms have not materialised, with more massive profits being posted. Meanwhile the Ofgem Price Cap is set to keep household energy levels at historic highs.

“Closing the energy firms’ windfall tax loophole could have almost eradicated fuel poverty last winter, but instead people suffered in cold damp homes.

“Now we are seeing the first signs that energy suppliers – as well as the producers – will be cashing in on the energy bills crisis with fixed term energy deals designed to boost their profits.”