Ofgem announces proposals for price cap on energy tariffs

Ofgem, the regulator for gas and electricity markets, has announced details of a proposed price cap on energy tariffs. This will mean households covered by the cap will be protected from being charged more than they should for their energy, with suppliers being required to reduce prices either to the level of, or below the cap. It is expected that the cap will be in place by the end of the year.

The price cap is expected to save consumers approximately £1 billion, with the exact savings a household may see dependent on their energy use, their current energy deal, how much they currently pay for their energy and whether they are duel customers. 11 million households on poor value default tariffs will be protected, whilst a typical consumer on the most expensive tariff is expected to save more than £120. Standard duel fuel energy consumers will have their tariff capped at £1,136, meaning customers will save an average of £75 each year.

Ofgem’s press release is available here and you can read the full proposals here.

A number of the End Fuel Poverty Coalition’s members issued statements in response to the price cap. You can read each members response by clicking on their name; Citizens Advice and National Energy Action.

The Coalition raises concerns over proposals to remove support for oil-fired boilers under ECO3

The End Fuel Poverty Coalition (EFPC) has written to the Minister of State for Energy and Clean Growth, Claire Perry, over the Department for Business, Energy and Industrial Strategy’s (BEIS) proposals to remove support for oil-fired boilers through the Energy Company Obligation (ECO). You can read the proposals for ECO3 here.

Dramatically improving domestic energy efficiency levels is the most enduring solution to ending cold homes. Yet in England, ECO – a scheme under which suppliers with more than 250,000 domestic customers provide funding to support vulnerable consumers – is the only mechanism which delivers vital domestic energy efficiency improvements.

An end to support for oil-fired boilers under ECO3 was proposed by BEIS and the Coalition expresses significant concern over this. Households using oil-fired boilers are often off-gas and in the deepest fuel poverty, leaving 140,000 of the poorest households in England with no way to heat their home. We believe that should the Government end support for oil-boilers, households must be able to access alternative policies, such as the Renewable Heat Incentive.

The Coalition also raised concerns as to the financial contributions households are likely to be required to make towards the energy efficiency measures provided through the scheme, despite having already contributed to the policy through their energy bills. This means those in the deepest fuel poverty will be unable to benefit from much-needed improvements due to them not being able to afford to make capital contributions.

You can read the Coalition’s letter to the Minister of State for Energy and Clean Growth here.

Since sending the letter, the Coalition is pleased to report that BEIS have announced in their response to the ECO3 consultation, that they will continue to allow new oil boilers to be install under ECO3. BEIS expects that new oil boilers will mostly be delivered in rural areas, although the policy doesn’t exclude other areas. Furthermore, BEIS announced a 400% uplift available to provide support for the replacement of broken boilers (including oil-fired boilers) under the cap to low income, vulnerable and fuel poor households. BEIS’ response to the consultation is available here.

The Coalition calls on Ofgem to preserve and extend the Safeguard Tariff

The End Fuel Poverty Coalition (EFPC) has written to Ofgem, the government regulator for electricity and gas markets in Great Britain, calling for the Safeguard Tariff to be preserved and extended.

Under the Safeguard Tariff, customers on prepayment meters or in receipt of the Warm Home Discount (WHD) are safeguarded as to how much they pay for their energy. This means there is a price cap at which suppliers can charge customers for their gas and electricity. More information about the Safeguard Tariff is available here.

Vulnerable customers are less likely to switch suppliers or tariffs. In 2016, the Competition and Markets Authority (CMA) reported that those on a low income, over the age of 65, on the Priority Services Register or with a disability are less likely to have switched supplier in the last 3 years. These consumers are therefore more likely to be on the highest tariffs and paying more than they should for their gas and electricity.

The Coalition advocates that the current Safeguard Tariff is expanded and is very concerned it will be prematurely withdrawn. Currently the Tariff is only available for those households in receipt of the WHD, which is made up of 2 groups; the ‘Core Group’, which largely consists of poorer pensioners, and the ‘Broader Group’ consisting of a small number of households who apply. This means many households who are of working age, in the lowest income deciles and burdened by high living costs miss out on the vital support provided.

Failure to extend and preserve the Safeguard Tariff could leave many low-income households exposed to increases in their energy bills, in turn creating anxiety over finances and leading to the adoption of unsafe coping mechanisms.

You can read the Coalition’s letter to Dermot Nolan, Chief Executive of Ofgem, here.

Fuel poverty recommendations for the next government

As the general election of 8th June approaches closer, the End Fuel Poverty Coalition makes five key recommendations to the parties, and to the government that is democratically elected.

Millions of people cannot afford to heat and power their homes. Millions are suffering ill-health, stress and anxiety from unaffordable fuel bills, which in turn can lead to social isolation and reduced educational attainment. The End Fuel Poverty Coalition believes that everybody has the right to a warm, dry home that they can afford to heat and power. We call on the next Government to take action to end fuel poverty and thereby improve people’s health and quality of life, reduce the cost of living, create jobs and cut carbon emissions.

1. Improve the homes of all low income households to the energy standards of homes built today (Energy Performance Certificate (EPC) Band C) by 2025 and make this a central element of its programme to address the lack of affordable housing in this country. This will result in dramatic improvements in comfort, health and quality of life and energy bill affordability for occupants.

2. Make improving the energy standards of our homes a central priority for investment in the country’s infrastructure and secure long-term funding for this. Improving the energy efficiency of Britain’s homes could cut household bills by around £370 a year, while reducing our reliance on gas imports by a quarter. It would also boost economic growth, create jobs in every constituency of the country and reduce pressure on health and social care services

3. Require fuel companies to provide bill rebates for all low income consumers and stop companies charging unfair prices to consumers who pay by prepayment meter and who have not benefited from energy market competition.

4. Take immediate action to improve the standards of private rented homes. This requires tough regulation – and effective enforcement of regulation – to outlaw dangerously cold homes from 2018 onwards. This should form part of a wider programme to improve tenants’ rights and security of tenure.

5. Implement a cross-departmental Fuel Poverty Strategy to end fuel poverty that sets targets for all relevant Government departments. In particular, this should address joint action to tackle cold-related ill-health, employment and income policies to make sure people have sufficient income to afford energy and other essential services and devolving power and resources to local authorities so that they can play a central role in delivering the Strategy.

The End Fuel Poverty Coalition’s recommendations can be downloaded here – Key recommendations to government May 2017.

Fuel Poverty Awareness Day 2017

This Friday 17th February is Fuel Poverty Awareness Day, a nationally recognised day to promote the issue of fuel poverty and the importance of ensuring vulnerable people are warm in their homes.

#FuelPovertyAwarenessDay is coordinated by our EFPC member, National Energy Action and intends to increase awareness of fuel poverty with a shocking 4.5 million UK households currently unable to live in a warm, dry home.


Support the cause by signing up to the Thunderclap here and help ensure that #FuelPovertyAwarenessDay reaches over 1 million people.

To coincide with #FuelPovertyAwarenessDay NEA is running The Nation’s Biggest Housewarming, many supporting organisations  holding events, issuing messages of support, or holding bake sales. Find out how you and your organisation can get involved here.

Keep your eyes peeled for a range of new resources released on the day, including a new Steps to Affordable Warmth video resource, which provides hints and tips on how to afford to stay warm and healthy at home, and is designed to be shared at community events, with clients or publicised online.

Find out more about the day here www.nea.org.uk/campaigns-policy/fuel-poverty-awareness-day

Bonfield Review overlooks local level fuel poverty interventions

The Each Home Counts review, or Bonfield Review, was launched in 2015 to consider issues relating to consumer advice, protection, standards and enforcement in relation to home energy efficiency and renewable energy measures in the UK.

It makes 27 recommendations on the themes below:

  • Consumer advice and protection
  • Standards framework
  • Monitoring and enforcement

We regard the Bonfield Review as an important opportunity to lay out practical measures to support energy efficiency measures, with the intention to eradicate fuel poverty as one of the key motivators. However, while the review makes some helpful proposals we are concerned that some key factors have been overlooked.

Primarily, a lack of focus on the importance of local and bespoke, personalised advice and support, as well as a poor integration between local and national government in the development and delivery of the measures proposed.

EFPC response to the Bonfield Review outlines three key recommendations:

Recommendation 1: Advice for fuel poor customers, particularly those that are vulnerable, needs to be embedded in wider local referral networks.

Recommendation 2: Ensure that provision of a local holistic fuel poverty advice service is supported by and funded by all relevant departments i.e. Department of Health, DWP and BEIS.

Recommendation 3: Advice must be provided in a variety of formats: telephone, internet and face to face, including home visits from trusted intermediaries for the most vulnerable.

You can read EFPC response to the Bonfield Review and the full review itself here.

Further action on prepayment meters required say Fuel Poverty Action

Fuel Poverty Action, an EFPC member, are continuing to press for the abolition of extra charges for energy customers using prepayment meters.

In October the Competition and Markets Authority (CMA) announced that it would impose a cap on costs for prepayment customers that would reduce bills by £75 a year. While a reduction is of course welcome, £75 is certainly not enough.

Prepayment meter users pay on average £300 more than customers on direct debit and are usually the worst off customers. Fuel Poverty Action, in collaboration with a number of organisations, are campaigning for  parity on energy costs, regardless of the method of payment.

So back on 11th November FPA and friends took action and went to the CMA directly to hand in their response, held in in a tiny doll’s cap, to highlight the insult of the CMA’s insufficient proposal.

Passing on the cap containing a scroll with the response, Ruth London of FPA told Project Director Erika Lewis,

“Energy companies’ license conditions forbid discrimination against users of PPMs, the CMA’s own Roger Witcombe has declared, ‘It is unacceptable that 4 million households on prepayment meters, many of them vulnerable, face higher bills than other energy customers,’ and yet the CMA’s proposals will perpetuate this injustice.”

Erika Lewis, for the CMA, agreed that the proposals are not set in stone and promised that they would take seriously the evidence provided.

To find out more and read Fuel Poverty Action’s statement on the CMA announcement please go to www.fuelpovertyaction.org.uk



NEA launch the Warm Homes Campaign – ‘I, Daniel Blake’ star backing the campaign

NEA’s Warm Homes Campaign aims to raise awareness of the importance of being able to live in a warm, comfortable home and illustrate how to improve access to equal life chances. This year, NEA is teaming up with I, Daniel Blake star Dave Johns who is backing the campaign.

“It is a complete scandal that people die because they can’t afford to heat their homes. I, Daniel Blake shows the tragic circumstances and daily dilemma of ‘heating or eating’ faced by many thousands of people in Britain today. I’m backing NEA’s Warm Homes Campaign to highlight what help’s available to cope with rising energy bills as winter takes hold and demand more support from Government.” Dave Johns

The campaign highlights that around four million UK households are still unable to access equal life chances because they live in a cold, damp home. These life chances are further compromised depending on the tenure of the home our baby will be born into.

New research by NEA shows that energy efficiency problems such as damp and unhealthily low temperatures are more prevalent in privately rented homes such as shared properties, bedsits and hostels. In a recent survey over two thirds said residents cannot afford to heat their room or shared space adequately. A similar number said the worst rental properties have such inadequate heating and insulation that it is impossible to keep them warm and free from damp.

The charity is warning that a baby born today and living in cold housing is more than twice as likely to suffer from breathing problems including asthma and bronchitis and three times as likely to suffer from wheezing and respiratory illness. As she grows up in the same housing conditions her chances of suffering mental health problems are higher – one in four adolescents living in a cold home are at risk of multiple mental health problems and evidence proves that living in fuel poverty impacts on educational attainment.

Find out more about the campaign here and its key asks here.

For updates on the campaign follow NEA on twitter @NEA_UKCharity #WarmHomesCampaign

Autumn statement: Overlooking energy efficiency will leave millions in the cold this winter

Press release in response to Autumn Statement (23.11.16)

The End Fuel Poverty Coalition (EFPC) warns that failure to adequately invest in binding energy efficiency targets risks leaving millions struggling in fuel poverty this winter

Philip Hammond’s first Autumn Statement showed no mention of investment in energy saving and efficiency measures so desperately needed to lift 2.3m English homes out of fuel poverty this winter. The statement flies in the face of recommendations recently made by the Committee on Fuel Poverty, the government’s own advisory body, who call for a £20bn injection for its legally binding 2030 targets and 2020 and 2025 milestones to be met.

While in today’s Autumn Statement the government held fast to its intentions to tackle inequality, spend more on the country’s infrastructure and intervene to address failing energy markets and high energy pricing, there was a glaring and obvious energy efficiency shaped hole in the measures outlined. A lack of investment in energy efficiency measures, such as a well-funded second Energy Company Obligation, is a huge missed opportunity for economic growth and poverty alleviation.

The government must find £20bn if it is serious about meeting its legally binding fuel poverty target – that the energy standards of all fuel poor homes must be at least EPC C by 2030, the standard of homes built today. It is likely to miss its two interim milestones set out in its 2015 Fuel Poverty Strategy that is that by 2020 no fuel poor household should live in a dangerously cold home below EPC E and that by 2025 no fuel poor household should live in a cold home – below EPC D.

The End Fuel Poverty Coalition is calling for the government to:
• Make sure £20bn is invested in improving fuel poor homes, as recommended by the Committee
• Hold a much-delayed parliamentary debate on fuel poverty as legally required, already overdue from May
• Put in place a detailed cross-departmental strategy and plan to show how it will meet the 2030 target and interim milestones

Fuel poverty background
• Twice as many fuel poor households live in cold homes (41%) as non-fuel poor households (19%)
• Fuel poor households need to pay £371 more per year to keep their home warm compared to the average household in England
• Prepayment meter consumers are more likely to be on a low income, a lone parent and disabled, yet pay on average £226 annually more for their energy than those paying by Direct Debit
• 2.3 million homes live in fuel poverty in England
• 96% of fuel poor homes are poorly insulated
• 21 million UK homes have poor energy efficiency (below B and C on an EPC)

Jenny Holland, Chair of the End Fuel Poverty Coalition said:

“Being able to live in a home that is warm over wintertime is a most basic need, currently unmet by 2.3 million families in England. The Autumn Statement was a prime opportunity for the government to prove its commitment to energy efficiency and in turn the alleviation of fuel poverty. However, the lack of mention of vital energy efficiency measures sadly nods towards its own legally binding energy efficiency targets being more rhetoric than reality.

If the government is truly committed to building an economy that works for everyone, it will recognise the huge benefits of recognising energy efficiency as an infrastructure priority and the huge potential for job creation in tandem with poverty alleviation.”

Advisory body calls for major funding injection to meet fuel poverty targets

Substantial investment is required if the government is to meet its fuel poverty targets according to its advisory body. The first report of the Committee on Fuel Poverty makes clear that the government must find £20bn if it is serious about meeting its legally binding fuel poverty target – that the energy standards of all fuel poor homes must be at least EPC C by 2030, the standard of homes built today.

The Committee also warns that without a substantial injection of funding, the government is likely to miss its two interim milestones set out in its 2015 Fuel Poverty Strategy, that is:

  • by 2020 no fuel poor household should live in a dangerously cold home – below EPC E; and
  • by 2025, no fuel poor household should live in a cold home – below EPC

The Committee makes 15 recommendations to government. As well as more money, it recommends re-introducing the Landlord’s Energy Savings Allowance; more financial assistance for households as they wait for energy efficiency improvements; improved targeting of fuel poor households through better data sharing; and improved energy advice.

The End Fuel Poverty Coalition welcomes the CFP’s report and its echoing our core concerns.

The End Fuel Poverty Coalition is calling for the government to:

1. Make sure £20bn is invested in improving fuel poor homes, as recommended by the Committee

2. Hold a much-delayed parliamentary debate on fuel poverty as legally required, already overdue from May

3. Put in place a detailed cross-departmental strategy and plan to show how it will meet the 2030 target and interim milestones

More information on the recommendations of the report are summarised on our website and in the full report.

Read the End Fuel Poverty Coalition’s response to the Committee on Fuel Poverty’s report here.