Tag: Energy Bills

Fuel poverty set to hit 11m households as protesters gather in Westminster

New estimates by the End Fuel Poverty Coalition reveal that the axing of the Energy Price Guarantee could lead to almost 11m UK households in fuel poverty from April 2023.

Based on the latest estimates on energy prices from Cornwall Insight, figures will rise from 7m households now to 10.7m (a rise from 24.5% to 37.6% of households) from April 2023.

While numbers will then fall slightly, it will still leave 10.1m households in fuel poverty in winter 2023/24.

The figures come as protestors gather in London to ask MPs to back plans for a universal basic energy allowance.

This energy allowance, which would meet basic needs for heating, cooking and lighting, is the core component of the Energy For All petition which will be handed into Downing Street today with more than 600,000 signatures.

MPs can also now back an Early Day Motion supporting the Energy For All plans. Ruth London of Fuel Poverty Action said:

Even the Energy Price Guarantee, which was billed as the government’s two-year solution to the price crisis, will not last two years but will end in April.The outlook is frankly terrifying.

It is now all the more essential – and more possible – to win a totally new pricing framework like Energy For All.  Finally there is now support for this inside Parliament.”

A spokesperson for the End Fuel Poverty Coalition, commented:

The government may have brought some stability to the markets, but it has come at the cost of huge instability in households’ finances.

The new Chancellor must work quickly, and with consumer groups and charities, to design a new package of support and energy market reforms that will help those in fuel poverty now and post April.

But while the political focus on energy bills may now have shifted to next April, millions of the most vulnerable will be living in cold and damp homes this winter and will need further financial and non-financial support.

The Warm This Winter campaign has called for GBP14bn of additional financial support as well as non-financial help for households this winter.

Chief among the non-financial asks is an immediate suspension of all forced transfers of households onto more expensive pre-payment meters (PPMs), whether by court warrant or remotely via smart meters.

These demands come alongside calls for more investment in energy efficiency and a move towards a renewable energy future, and away from oil and gas.

Cara Jenkinson, Cities Manager at Ashden, which is part of the Warm This Winter campaign, added:

Poor quality homes that leak energy are currently causing the NHS £1.4bn a year as well as misery for people in damp, cold homes.

To solve fuel poverty for good, we need a rapid scale-up of home retrofit focused on the areas that need it most, with an investment in the construction skills needed so that work isn’t stalled by a lack of workers.

Tessa Khan, director of Uplift, said:

On top of everything else, this government’s plan to fix the UK’s energy system is also in disarray.

We need a government prepared to tackle the crisis at its root, which means moving the UK off volatile fossil fuels with a national insulation programme to cut waste, and a massive acceleration in renewable energy, which is now nine times cheaper than gas.

This is the only way to permanently lower energy bills.

The government needs to stop adding to our problems and fix the ones on their desk. This must begin today with providing more targeted help for those who are going to be hit hardest.

Ross Matthewman, Head of Policy and Public Affairs of the Chartered Institute of Environmental Health said:

The decision to end the price cap freeze after six months rather than the proposed two years will have a devastating effect on households struggling with their energy bills. While insufficient, the two-year energy price cap freeze provided some reprieve to households, who now face grave uncertainty on what support on household energy bills exist beyond April.

We urgently call on the UK government to get a grip, reinstate the two-year energy price cap freeze as well as intervene more broadly to support households struggling with their energy bills.

While we welcomed the government’s Energy Bills Support Scheme, it is apparent that £400 spread over six months is simply not going to be enough to tackle the spiralling cost of energy crisis, with more significant intervention needed.

Not only are we are calling on the government to double the amount of financial support provided to households to protect households this winter, but we are also urging them to introduce a raft of energy efficiency measures. Such measures can act both as a means of supporting households most in need right now as well as shielding households from spiralling energy bills in the long-term.

Electricity markets must be fairly priced for consumers

The End Fuel Poverty Coalition has responded to the Government’s Review of Electricity Market Arrangements with a call that reform must harness the benefits of net zero, reduce risks of price volatility and deliver a secure supply to consumers.

The Consultation closed on 10 October and among the issues up for discussion was how the cost of electricity is determined.

Currently, the energy market is underpinned 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 the cost of gas power station produced electricity, not renewable energy. Yet, renewables make up the biggest proportion of the energy mix (38.7%, BEIS) and are nine times cheaper than gas-fired power stations.

Therefore the Coalition’s response urged the Government to unlink the cost of energy from gas:

As the UK transitions away from fossil fuels, the cost of natural gas, coal and oil should no longer be the dominant factor in determining the price consumers pay for their electricity.

It is crucial that consumers reap the benefits of cheaper renewable electricity sources and no longer have their unit rates determined by volatile fossil fuel prices.

Therefore, we support reforms to the marginal pricing system as long as the Government devises a mechanism for ensuring this provides a reduction in consumer costs and maintains consistency of supply.

In its response, the Coalition welcomed plans to reform the energy market and the Government’s commitment to reliability and affordability.

However, the Coalition adds that the Government “must ensure the needs of vulnerable consumers – and those already in fuel poverty – are better accounted for in these plans.”

Given concerns about possible energy blackouts this winter, the consultation response calls for decarbonisation of the energy grid, security of supply and lower costs for consumers to ensure households are protected from wholesale price volatility. The Coalition added that:

Demand must always be matched by supply, particularly for the most vulnerable consumers such as isolated rural communities and those relying on life saving medical equipment.

The response calls for the Government to successfully utilise the UK’s extensive renewable energy resources and deliver them to consumers through the electricity grid so to help mitigate price volatility and ensure we have a more secure energy future.

Part of this is ensuring that the country harnesses the power of renewables like wind and solar. But the consultation response also calls for measures to avoid continued reliance on fossil fuel backups to meet peak demand by improving the UK’s energy storage capacity.

Blackouts an intolerable situation say campaigners

Commenting on reports that the UK may be subject to rolling black outs or enforced energy cuts, a spokesperson for the End Fuel Poverty Coalition commented:

We need to ensure we have enough supply to help the most vulnerable.

People such as the disabled and elderly or those using respirators, can’t just turn off their energy use. They are already in fuel poverty and keeping usage to a minimum, so it will be life threatening in some situations.

While there may be some scope for some households to reduce usage and save energy, we should not be encouraging self-disconnection or forcing people to live in cold damp homes.

The Government needs to realise that its obsession with fossil fuels has led us to this point and increasing our reliance on them is not the way to end the energy crisis.

This intolerable situation shows that the faster we move to renewables and an improved energy market, the better.

We need a plan to improve energy efficiency, develop more sustainable ways of keeping people warm every winter and for a long term shift away from gas and onto more renewable energy.

 

Homes to see energy prices surge overnight

As the fall-out continues from the Chancellor’s mini-Budget, new analysis of the impact of the Energy Price Guarantee has revealed a stark winter facing millions of people.

The Government’s plan only caps the cost per unit that households pay, with actual bills still determined by how much energy is consumed.

The End Fuel Poverty Coalition calculates that the combined electricity and gas unit cost of energy will surge for households by between 23% and 27% overnight on Friday. [1]

The level of surge depends on the type of payment method and where people live in the country.

When standing charges are also included in the analysis, those on standard credit will pay 12% more and those on pre-payment meters 11% more than those on direct debit.

While the Energy Bills Support Scheme will lower peoples bills by GBP400 in the short-term, this saving expires in April 2023 creating a fresh hike in people’s bills. For households on benefits, the additional support they have had since May 2022 will also expire early in 2023 making the impact even more severe. [2]

Campaigners have urged the public to take meter readings tonight and submit them to their energy suppliers to ensure they do not incur additional costs caused by the increased unit prices from 1 October 2022.

In addition, the End Fuel Poverty Coalition has urged the Government to go further in support for energy efficiency measures.

In last week’s mini-Budget, over GBP1bn additional funding was pledged to improve insulation of peoples’ homes over the next three years. New estimates show that this falls far short of the additional GBP5bn energy efficiency investment needed.

Meanwhile, the number of UK households in fuel poverty will increase from 7 million from 1 October to nearer 8m from 1 April 2023 as the Energy Bills Support Scheme runs out.

Frazer Scott, CEO of Energy Action Scotland, commented:

This week, every household across the UK must make sure it submits a meter reading to their energy firm to avoid paying a penny more than they absolutely have to when prices go up on 1 October.

Fuel poverty is at record levels, levels of energy efficiency improvements are simply too low to provide respite and financial support is just a sticking plaster on the deepest of wounds.

As unit costs for electricity and gas push bills higher still in October, communities will suffer and take years to recover. Meanwhile the impact of fuel poverty will be felt on the NHS and social care system and lives will be needlessly lost.

Asthma + Lung UK has recently seen calls to the charity’s helpline from people needing advice for help with their finances or benefits soar by 89% [3]. Dr Andrew Whittamore, Clinical Lead at Asthma + Lung UK and a practising GP, said:

Winter is the deadliest season for people with lung conditions. Cold homes are very dangerous for people with lung conditions because they provide the perfect environment for respiratory infections to thrive.

This situation is untenable and Asthma + Lung UK is urging the government to provide targeted financial support to help people with lung conditions with the rising cost of bills and living.

Tessa Khan, director of Uplift which is part of the Warm This Winter campaign, said:

The government’s massive energy bill bailout is costing us a fortune but doesn’t fix the problem at its root: millions of people will still be forced into impossible choices by soaring gas prices and still we have no credible plan from the government to wean the UK off volatile fossil fuels.

With homegrown renewables now nine times cheaper than UK gas, it is 100% in the national interest to accelerate all forms of cheap, renewable energy so that we don’t find ourselves facing the same energy bill crisis in years to come.

Rhi Hughes, Community Engagement Manager, South West London Law Centres said:

All of us will have a lack of control this winter. It won’t be a case of ‘well, I just won’t put the heating on’ or ‘I will use minimum electricity today’ to get us out of this. Although cutting down fuel use will help, our standing charges are going to sharply increase. If we can’t top up our pre-payment meters we will be getting into debt with our service charges and that debt will keep growing.

Such a range of households are going to be hit so hard by the increase. Homeowners in homes that need repairs have leaks, windows that don’t shut, doors that don’t close and they are just going to freeze as they don’t have the money to fix the problem or to put the heating on.

Some tenants are forced to live in such bad condition housing that there is nothing they can do to keep heat in as there are large cracks in walls or ceilings. It is the responsibility of the landlords to fix these issues but they don’t – especially housing association and council tenants. These large authorities are exasperating the crisis for the people they are paid rent by.

A spokesperson for the End Fuel Poverty Coalition, added:

The Government has created a double dose of pain for households. Many will be hit with the rising energy bills immediately, with another dose of pain inflicted when the financial support runs out by April 2023.

We need action now to reassure people that support will continue next year and urgent action to improve the energy efficiency of our homes into the future.

Notes

[1]

Price cap unit rates chart
All financial numbers are quoted in p
DIRECT DEBIT
Cost from 1 Oct 22 Cost until 30 Sep 22 INCREASE FROM SUMMER 22
GAS UNIT (kwh) 10.3 7.37 39.76%
GAS SC 28.49 27.22 4.67%
ELEC UNIT 34 28.34 19.97%
ELEC SC 46.36 45.34 2.25%
1 day of both fuels & 1 kwh used of both fuels 119.15 108.27 10.05%
1 unit of each 44.3 35.71 24.05%
PRE PAYMENT METERS
From 1 Oct Until 1 Oct INCREASE
GAS UNIT (kwh) 10.63 7.36 44.43%
GAS SC 37.51 37.28 0.62%
ELEC UNIT (kwh) 33.08 28.11 17.68%
ELEC SC 51.41 50.27 2.27%
1 day of both fuels & 1 kwh used of both fuels 132.63 123.02 7.81%
1 unit of each 43.71 35.47 23.23%
Uplift from DD 13.48 14.75
% Uplift from DD 11.31% 13.62%
STANDARD CREDIT
From 1 Oct Until 1 Oct INCREASE
GAS UNIT (kwh) 11.12 7.76 43.30%
GAS SC 33.54 32 4.81%
ELEC UNIT (kwh) 36.8 29.85 23.28%
ELEC SC 52.4 51.16 2.42%
1 day of both fuels & 1 kwh used of both fuels 133.86 120.77 10.84%
1 unit of each 47.92 37.61 27.41%
Uplift from DD 14.71 12.5
% Uplift from DD 12.35% 11.55%
Original data unit cost source: https://www.moneysavingexpert.com/utilities/what-are-the-price-cap-unit-rates-/

Combinations, increases and uplifts calculated by End Fuel Poverty Coalition

[2] ​​

Average household bills under Ofgem Price Cap (*) and Energy Price Guarantee (**). All financial numbers quoted are in GBP. “Average household (hh)” Average hh increase Those hh getting max Govt support, average hh rate Those hh getting max Govt support, % increase
Oct-21* 1277 1277
Apr-22* 1971 54.35% 1571 23.02%
Oct-22** 2100 6.54% 1700 8.21%
Apr-23** 2500 19.05% 2500 47.06%
Increase Winter 2021/22 to Summer 2023 96% 96%
Increase Winter 2021/22 to Winter 2022/23 64% 33%

[3] Asthma + Lung UK internal figures. Comparison August 2021 to August 2022. Website traffic on these topics also surged year-on-year by 63%.

Coalition reacts to Energy Price Guarantee announcement

Despite the UK Government’s Energy Price Guarantee, the End Fuel Poverty Coalition estimates that 7m households across the UK will be in fuel poverty this winter.

A spokesperson from the End Fuel Poverty Coalition commented:

While many households will benefit from the price cap freeze, the Prime Minister offered no detail of any additional support for the millions of households who will be left behind in fuel poverty this winter.

Many of these people are struggling already and include those who are elderly, disabled or with pre-existing health conditions. Without more support to keep them warm this winter, the pressures on the NHS and social care system will increase.

And without further investment in measures such as energy efficiency for those homes worst affected by fuel poverty and renewables, the plans will just be an expensive sticking plaster.

Adam Scorer, chief executive of fuel poverty charity National Energy Action (NEA) said:

The UK government’s plan to freeze energy bills means the average household will pay around £2,500 a year, instead of the predicted £3,549 average a year. This will bring huge relief. It means more than 24 million households will face lower bills this winter. And it could help stop over 2 million households from being plunged into fuel poverty.

However, despite the good news, many households in serious fuel poverty need more than reassurance about future prices, they need rescuing from current prices.

Just over 12 months ago the average annual bill was just £1,271. Even with this price freeze the average bill has doubled in a year. Last year 4.5 million UK households were fuel poor, now we predict that it will be 6.7 million – far better than the 8.9 million without support, but still more needs to be done. In particular, measures need to work for households in Northern Ireland who are outside the GB energy market and its price cap.

The new Government must not forget that the most vulnerable need targeted support. Those who use more energy in their homes because of medical conditions, those who are elderly and those on very low incomes need extra help so they don’t have to ration their usage, putting their physical and mental health at risk. Those on prepayment meters must not be forgotten either. They would benefit from a lower rate or additional relief from huge standing charges.

We hope too, that longer term the Prime Minister will focus on greater investment in energy efficiency. It not only saves consumers money and makes homes warm and safe places to live, it creates jobs, provides an economic return to the Treasury and reduces strain and costs for our stretched health services.

Jess Ralston from ECIU commented:

The PM’s plan delivers on emergency bill help this winter, but lacks any kind of plan for dealing with the root cause that expensive gas and poor quality homes are costing bill and tax payers billions.

Every pound spent by Treasury on insulation this winter could pay back by the next election by cutting the £150bn energy price freeze bill landing on the exchequer. It’s simple, using less gas improves our security and lowers our bills.

The Joseph Rowntree Foundation told the BBC that there will still be an  £800 gap between the overall rise in the cost of living and the support package that the poorest families were receiving. JRF chief analyst Peter Matejic said:

The government’s energy price freeze headed off a stratospheric predicted price increase from October, but struggling households remain extremely worried about how they are supposed to fill this gap.

This shows Liz Truss’s job isn’t done. When she unveils further plans as part of her fiscal statement she must remember the many low income families suffering in hardship.

Warm This Winter campaign members, The Wildlife Trusts tweeted their opposition to the Government’s plans to include fracking as part of the plans:

More reaction from members of the Coalition to follow.

Almost total fuel poverty in some areas, despite price freeze plan

Some areas of the country risk seeing almost every home in fuel poverty without a comprehensive plan from the new Prime Minister. [1]

Even taking into account rumoured plans for a freeze on energy bills, over twenty neighbourhoods in Birmingham, Bradford, Coventry, Hull, Leeds, Liverpool, Sheffield, Stoke and Wolverhampton could see fuel poverty rates of over 75 per cent of households from 1 October 2022. Some will reach close to every household in the area. [2]

Hundreds of other areas across swathes of the country – from Southampton to Middlesborough and from Essex to Lancaster – will also see significant levels of fuel poverty this winter. [3]

As the new Cabinet finalises plans for the support package for households this winter, the figures highlight how parts of the country will experience fuel poverty differently.

A briefing to MPs and Peers from the Warm this Winter campaign calls on Parliamentarians to push for a coherent plan to tackle the energy bills crisis through a national rollout of home insulation and affordable renewables to wean the country off gas. [4]

The campaign is also demanding that the new government provides more direct emergency financial support for everyone this winter, but particularly low-income households.

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

We need to see the right support get through to the right people.

The Government’s plans focus on offering welcome universal support through a price freeze, but we also need additional help for the millions of households in fuel poverty who are already struggling.

These new figures show this can vary significantly by region and by property type.Any investment this winter also needs to include long-term solutions such as a support for energy efficiency and a boost for renewables to help move the country away from fossil fuels.

Jacky Peacock, Head of Policy at Advice for Renters said:

Renters are particularly hard hit as inflation and scarcity of private rented homes are pushing up rents at an unprecedented rate, leaving little or nothing to spend on energy bills. Without the right action from the Government, we risk seeing a huge explosion in homelessness.

Rachael Williamson, Head of Policy and External Affairs at the Chartered Institute of Housing, said:

Social landlords across the country are taking a range of actions to support vulnerable residents under financial strain where they can, but there is a limit to what the housing sector can do.

The pressures are so great that many households now have negative budgets, even after all avenues of support have been exhausted. Many social housing providers are themselves challenged by above inflation cost increases.

Urgent support is needed, targeted to help people on the lowest incomes and substantial enough to meet the scale of the challenge.

Graham Duxbury, Chief Executive of community environmental charity Groundwork, said:

Rising levels of fuel poverty are creating a public health emergency. The Covid-19 pandemic highlighted the stark health inequalities in our communities and without urgent action from the government these will become even more extreme.

Every day, our energy advisers visit people who are unable to heat their homes, leading to problems with damp and mould. The physical impact on health can be devastating and fuel poverty also damages people’s mental health.

On local authority level, the areas that will be worst affected are, Barnsley, Birmingham, Coventry, Hull, Leicester, Manchester, Nottingham, Norwich, Sandwell, Stoke-on-Trent, Wolverhampton. The whole of West Yorkshire and South Yorkshire as well as Liverpool, Newcastle-under-Lyme, North East Lincolnshire, Scarborough, and the London boroughs of Newham and Barking & Dagenham will also be hit hard with a GBP2,500 price cap.

Cara Jenkinson, Cities Manager at climate solutions charity Ashden, which is part of the Warm This Winter campaign, added:

The Government must fund local insulation programmes in the areas where fuel poverty is highest, and councils should not have to compete against each other for this funding. We need a rapid scale up of energy efficient retrofit which will insulate people against further price rises, cut carbon and create jobs across the country.

The Warm This Winter petition supporting the campaign’s demands has been signed by 120,000 people since it was launched last weekend while Fuel Poverty Action’s petition for Energy For All, a free allocation of energy to meet each household’s needs, has been signed by 557,000 people and will be delivered to the new Prime Minister on 19 September.

Ruth London from Fuel Poverty Action said:

People of all ages are being robbed of even the essentials of life while massive energy corporations chalk up undreamed of profits.

Over half a million have signed our petition for Energy For All: The energy to ensure we can heat and light our homes must be free and guaranteed, and the money must come from the industry that is causing this crisis to begin with.

People who can well afford to pay extra should no longer pay a lower price than those who are frightened to turn on a light in damp, poorly insulated bedsits.

Alethea Warrington, campaigns manager at climate charity Possible, said:

Our failure to get off gas for good is fuelling the energy costs and climate crises. Drilling for more gas would totally fail to alleviate the unaffordable energy costs that are pushing people into poverty, as any gas would take decades to come online and would then be sold in global markets.

But we do have a solution – clean, cheap, domestic renewable energy like onshore wind and solar, which can come online quickly and is around a tenth of the cost of gas power.

Renewables are popular across the UK, and it’s past time for the government to get on with delivering them.

The Warm This Winter campaign launched on 26 August in response to the growing energy bills crisis. The campaign demands that the government provides more emergency money for people this winter, funding to help everyone cut their bills with better insulation, and rapidly moves the country away from expensive gas and onto cheaper, renewable energy.

New modelling by Tax Justice UK, found that a 95% excess profits tax on North Sea oil and gas companies could raise up to £44 billion a year for two years and would almost cover the cost of living package the government is set to announce.

ENDS

Notes to Editors

[1] Estimates for the previous price cap announcements show that from 1 October, 21 million people in around 9 million homes (32%) will be in fuel poverty this winter based on levels of support pledged up to 05.09.22 and are reflective of the definitions of fuel poverty used in official statistics. The figures were set to grow to around 28 million people in 12 million UK households (42%) from January 2023 unless urgent action is taken by the Government.

Based on multiple media reports of a “price freeze” of energy bills at a level of GBP2,500 from 1 October 2022 (and with the GBP400 promised support, this falls to GBP2,100), the End Fuel Poverty Coalition estimates that 16.4 million people in 6.9 million UK households will still be left in fuel poverty in winter 2022/23 without government support. c.5.3 million of these households will be in England.

Regional data for England based on LSOA level calculations or local authority / metropolitan authority level. Methodology, assumptions and definitions available at https://www.endfuelpoverty.org.uk/price-cap-methodology/ (page being updated with latest figures, but assumptions and methodology remain).

Millions more are also set to suffer based on more general measures of fuel poverty and fuel stress used by some academics and campaigners.

[2] Selection of the neighbourhoods of the country in almost total fuel poverty from 1 October 2022. Based on 23 out of 32,844 LSOA areas.

Birmingham: https://mapit.mysociety.org/area/154406.html

Stoke on Trent: https://mapit.mysociety.org/area/114803.html

Leeds: https://mapit.mysociety.org/area/77587.html

Sheffield: https://mapit.mysociety.org/area/74208.html

Hull: https://mapit.mysociety.org/area/79055.html

Coventry: https://mapit.mysociety.org/area/75782.html

Wolverhampton: https://mapit.mysociety.org/area/76624.html

[3] Over 400 (411) neighbourhoods will see fuel poverty at levels exceeding 55% of households.

[4] Briefing note to Members of Parliament – link here. Briefing note on the Energy Bill for Members of the House of Lords – link here.

Warm this Winter is a new campaign demanding the government acts now to help tackle rising energy bills this winter and to ensure energy is affordable for everyone in the future.

It is supported by leading anti-poverty and environmental organisations, including Save the Children, WWF and the End Fuel Poverty Coalition. Its demands of government are:

  1. Emergency support now: Provide a new package of financial support to people who, without additional urgent action, will be on the front-line of poverty this winter.
  2. Help to upgrade homes: Launch a properly-funded programme of home upgrades and insulation across the UK to bring down bills and prevent energy waste.
  3. Cheap energy: More than triple the amount of renewable energy in the UK by 2030, including wind and solar generated in harmony with nature, so that we can permanently lower bills.
  4. Free us from oil and gas: Stop opening up new oil and gas fields so that we can escape our dependence on volatile fossil fuels.

Speculation continues over new measures to tackle fuel poverty

Senior figures in the Conservative Party came under increasing scrutiny this week as consistent media headlines accused them of failing to act.

After last week’s headlines about the Ofgem price cap changes, Cornwall Insight provided the latest estimates on the likely price cap.

This revealed that the average energy bill in October will rise to £3,542 (£3,182 including the Government’s planned household support” and then to £4,266 from January.

The End Fuel Poverty Coalition predicts that this will result in 9.2m households being in fuel poverty in October, with the number growing to 10.5m in early 2023.

As the Coalition told CNN:

Only a full programme of emergency financial support, a rapid expansion of energy efficiency programmes and a commitment to bringing more cheap renewable energy on stream will help people stay warm this winter and into the future.

During the week, the leadership contenders felt the pressure as fuel poverty campaigners with Warm This Winter targeted the Darlington hustings to press home the message that more needed to be done.

Rishi Sunak responded with plans for more support for households, but also an expansion in the country’s reliance on fossil fuels.

Meanwhile Liz Truss continued to avoid directly promising support. This lead to her local paper, the Eastern Daily Press to run a large feature highlighting the devastating impact her policies will have on her own constituency.

After accusations that he was presiding over a Zombie Government, the acting Prime Minister also attended a meeting with energy firms. Afterwards, the Treasury admitted to the Guardian that support would not be enough.

As the week drew to a close, figures showing a slight decline in GDP also posed a challenge to leaders, with Jennifer Wallace from Carnegie UK (which proposes a wellbeing approach to measuring a nation‘s success) commenting:

These figures take into account a dramatic increase in the cost of living, in part due to the rising costs of home energy bills.

While this has helped prop up the GDP figures somewhat, it is hugely damaging for the UK’s collective wellbeing due to rising anxiety for people who are worried about being unable to heat their homes this winter.

As an article in the Sunday Times revealed that people will not be able to afford vital care, the Government is also now rumoured to be planning for additional help. However, the Coalition commented:

The toll on the mental health of people struggling to pay their energy bills or plan ahead should not be under-estimated.

We are already seeing disabled people unable to charge their medical equipment because they can’t afford to use electricity.

If the Government is unwilling to help everyone this winter, it should at least support the most vulnerable.

The Lib Dems and Labour revealed some of their suggestions for helping offset the energy bills rise.

Labour has pledged to act on the unfair pre-payment meter tariffs in the first of a proposed series of announcements, while the Lib Dems called for universal support to be extended to cancel out the October price rise.

 

Details of Energy Bills Support Scheme announced

Millions of households across Great Britain will receive non-repayable discounts on their energy bills this winter, as the UK Government today has set out further details of the Energy Bills Support Scheme (EBSS).

The £400 discount, administered by energy suppliers, will be paid to consumers over six months with payments starting from October 2022, to ensure households receive financial support throughout the winter months.

The Government has stressed that in all cases, no household should be asked for bank details at any point. Ministers are urging consumers to stay alert of potential scams and report these to the relevant authorities where they are suspected.

A spokesperson for the End Fuel Poverty Coalition commented:

The details of the Energy Bills Support Scheme are broadly welcome.
The officials involved in the development of the scheme have done a good job in listening to the concerns of End Fuel Poverty Coalition members and have taken steps to ensure that every household will be able to benefit.
While there are a few outstanding concerns, we are pleased that BEIS has agreed to work with our members to address these.
The bigger issue, however, is that the level of support available will not be enough to offset the rises in energy bills expected in October and Ministers will need to instruct officials to expand the funding for the scheme.

The Government has issued detailed information for people on how the scheme will work, based on the current proposed £400 discount:

  • The £400 discount will be administered by suppliers and paid to consumers over six months with payments starting from October 2022, to ensure households receive financial support over the winter months.
  • Households will see a discount of £66 applied to their energy bills in October and November, rising to £67 each month from December through to March 2023.
  • The discount will be provided on a monthly basis regardless of whether consumers pay monthly, quarterly or have an associated payment card.
  • Households will never be asked for their bank details, and those with a domestic electricity connection will not need to apply.
  • There is no need to contact your supplier as all domestic electricity customers will be automatically eligible. Electricity bill payers should enquire with their supplier if they have not received their first instalment by the end of October.

Breakdown of the delivery process for each payment method:

  • Direct Debit customers will receive the discount automatically as a reduction to the monthly Direct Debit amount collected, or as a refund to the customer’s bank account following Direct Debit collection during each month of delivery.
  • Standard credit customers and payment card customers will see the discount automatically applied as a credit to standard credit customers’ accounts in the first week of each month of delivery, with the credit appearing as it would if the customer had made a payment.
  • Smart prepayment meter customers will see the discount credited directly to their smart prepayment meters in the first week of each month of delivery.
  • Traditional prepayment meter customers will be provided with redeemable vouchers or Special Action Messages (SAMs) in the first week of each month, issued via SMS text, email or post. Customers will need to take action to redeem these at their usual top-up point.
  • Landlords who have a domestic electricity contract with a licensed electricity supplier and then resell the electricity to their tenants based on energy usage must comply with the maximum resale price rules. The maximum resale price for electricity is currently set as the same price as that paid by the person reselling it. Under these circumstances, the Government expects landlords to pass on the discount received to each tenant.
  • Landlords with a domestic electricity connection who charge ‘all inclusive’ rent, often the case for many student houses, where a fixed cost for energy costs are included in their rental charges, must pass on the discounted payments to tenants.
  • Approximately one per cent of UK households are currently ineligible to receive Energy Bills discount as they do not have a domestic electricity meter and a direct relationship with an electricity supplier. The government has confirmed that further funding will be available to provide equivalent support of £400 for energy bills for the 1% of households who will not be reached through the Energy Bills discount. An announcement with details on how and when these households across Great Britain can access this support will be made this Autumn.

The Energy Bills Support Scheme forms part of the Government’s £37 million Cost of Living Support package, providing Help for Households with rising prices, targeted at those most in need.

Leading charities urge PM-hopefuls to end fuel poverty

Warm This Winter, a new national coalition group, has published an open letter in The Times to all candidates in the race to become the next Prime Minister asking that they urgently set out how they plan to address the cost of living crisis driven by soaring energy bills.

The letter calls on each of the candidates to use these next precious few weeks to set out practical measures for how they will help people now, and how they will ensure we have lower energy bills in future. 

The campaign, which is backed by the End Fuel Poverty Coalition, is pushing for practical solutions that have the public’s support, and which are ready-to-roll out now, including:

    • Providing financial support to people who without urgent action will be on the front-line of poverty this winter
    • Upgrading and insulating homes across the UK to bring down bills and prevent energy waste
    • Rapidly expanding clean energy, which is now four times cheaper than gas, to urgently lower energy bills
    • Stopping drilling new oil and gas fields so that we can escape our dependence on volatile fossil fuels.

A spokesperson for the End Fuel Poverty Coalition commented:

Based on current estimates, well in excess of a third of all homes will be in fuel poverty this winter, yet the candidates to be our next Prime Minister are ignoring the single most pressing issue facing families across the country.

Unless leadership candidates promise bold and decisive action, the next Prime Minister’s first act as leader will be to preside over the worst winter for millions of people in living memory.

Full letter to candidates

We are writing to you from Warm This Winter – a new national coalition representing 40 organisations and over 22 million people from across the UK during this time of national economic crisis – to ask what your plan would be as Prime Minister to address the cost of living crisis.

We are headed into a potentially catastrophic winter. In eleven weeks time, more than a third of households – many millions of British families –  may not be able to afford to heat their homes. Meanwhile, earlier this year, 2.3 million families on low income were going without enough food and were unable to keep their homes warm. 

According to the latest predictions, from October 1st the average annual energy bill will be over £3200. That means, for example, that the average pensioner will spend more than a third of their state pension on heating their home – and many people, including families, will have to choose between heating and eating. In the words of Martin Lewis last week: “millions of households will be forced into poverty unless we act. This is a genuine, urgent emergency.”

So far in the Conservative leadership campaign, no candidate has put forward a credible plan to support families, businesses, village and community halls, places of worship, hospitals and schools to keep their buildings warm this winter. Indeed whilst the public has grasped the scale and seriousness of the crisis heading our way, none of the leadership candidates seems to have done so.

We believe that in these next precious few weeks – when the Government should be planning and preparing for this winter – you should set out your plan for tackling the crisis of unaffordable energy bills, which are set to remain high until at least 2025. We know that this emergency, fuelled by the spiralling price of gas and by the war in Ukraine, does have solutions that are ready-to-roll out now – and that would also help us protect the future of the natural world – these include:

  • Providing financial support to people who without urgent action will be on the front-line of poverty this winter
  • Upgrading and insulating homes across the UK to bring down bills and prevent energy waste
  • Rapidly expanding clean energy, which is now four times cheaper than gas, to urgently lower energy bills
  • Moving away from drilling new oil and gas fields so that we can escape our dependence on volatile fossil fuels

Our members and supporters want to know what your plan would be – so we can have a proper debate on the most important and urgent issue facing this country. Whilst we may not all have a say in who becomes the next Prime Minister, we can ask that any candidate has a practical plan to keep people safe and warm this winter. 

We would be keen to meet with you to discuss this further.

Full list of signatories:

  1. End Fuel Poverty Coalition
  2. The Climate Coalition
  3. CPRE The countryside charity 
  4. Wildlife & Countryside Link
  5. Save the Children
  6. WWF UK
  7. The Wildlife Trusts
  8. Oxfam
  9. Fuel Poverty Action
  10. Fair Energy Campaign
  11. Robin Hood Tax
  12. The Centre for Sustainable Energy
  13. Energy Action Scotland
  14. Chartered Institute of Environmental Health
  15. Possible
  16. Ashden
  17. Austerity Action Group part of Social Workers Union
  18. New Economics Foundation
  19. Uplift
  20. Camden Federation of Private Tenants
  21. Regen
  22. Northern Housing Consortium
  23. Groundwork
  24. Advice for Renters
  25. Fairer Housing
  26. Friends of the Earth Scotland
  27. MCS Charitable Foundation
  28. Fairness Foundation
  29. Tax Justice UK
  30. Women’s Budget Group
  31. The Economic Change Unit 
  32. Wellbeing Economy Alliance Scotland
  33. IPPR
  34. Chartered Institute of Housing
  35. The Centre for Ageing Better
  36. The Working Class Economists Group
  37. Greenpeace UK 
  38. Friends of the Earth England, Wales and Northern Ireland
  39. 38 Degrees
  40. Action with Communities in Rural England

    41. %0

Government urged to address ten failures in energy bills plans

Fuel poverty campaigners have revealed ten significant failures in the Government plans to address the escalating energy costs this winter.

In a letter to the Chancellor and other Cabinet Ministers, the End Fuel Poverty Coalition has called for a meeting to discuss operational problems with the measures announced by the Government on 26 May.

Among the concerns highlighted by the group of more than 60 charities, trade unions, social enterprises, local government representatives and other campaigners are:

  • A failure of proposals to help those on pre-payment meters, in Park Homes, off-gas, on heat networks and not on electricity meters.
  • The risk that those in the Private Rented Sector will not see the benefits of Government support passed on by landlords.
  • Concerns about how the financial support may impact on the care charges disabled, elderly and vulnerable people are assessed on.

With the winter 2022/23 price cap now predicted to exceed the £2800 Ofgem estimates, the End Fuel Poverty Coalition has also called for wider reform to the energy market.

It warns that further, short-term, financial support for people in fuel poverty will be needed this winter to mitigate any further increases in the price cap above £2800 and support for those suffering already.

The Coalition has also repeated its calls for a review and subsequent reform of the energy supply market to consider the introduction of policies such as a social tariff, energy for all allowance and a total price cap ceiling.

Anne Vivian-Smith, a disabled former community worker from Nottinghamshire, commented:

The lack of urgency from the Government is terrifying. Special tariffs for disabled customers who have unavoidably high energy use need to be created now. Disability benefits have not increased, yet disabled people have very few ways to economise without cutting something essential like food or care.

Heating or eating isn’t a slogan, it’s reality, it’s now and we need help.

A spokesperson for the End Fuel Poverty Coalition, commented:

As well as operational concerns about the existing Government support, Ministers must also realise that the measures will only seek to prevent additional homes entering fuel poverty and help to stop many of those in fuel poverty becoming utterly destitute. It will not fundamentally improve the situation of the 6m-plus households already in fuel poverty.

We would urge the Government to make further statements to set out additional financial support for people in fuel poverty this winter, announce co-ordinated action to improve the energy efficiency of our homes and ensure we have a secure, renewable-led, domestic energy supply.

Ian Preston, director of household energy services at the Centre for Sustainable Energy said:

It’s not fair that people, especially those on low incomes, are paying for the energy market failure through bills. If the government insists on reclaiming these costs via our bills, then they should be collected at the unit rate so those that consume more energy pay more. The average annual energy bill increase is significant for people on low incomes, who are already having to make tough choices about paying for energy or other essentials like food. They simply can’t cover any additional costs.

Every month, CSE’s advice service helps thousands of people reduce their bills and we’ve already seen unprecedentedly high numbers of people seeking energy saving or financial advice. Urgent support is needed to cope with the UK pandemic of fuel poverty, but the only long-term solution is insulation.

We need to stop energy waste from cold buildings and homes. If you insulate someone’s home, you are literally insulating them against the cost of energy.”

Ruth London from Fuel Poverty Action commented:

Instead of further subsidising investment in polluting fossil fuels, the government should be ensuring that every household has enough energy to keep warm and keep the lights on. Energy For All – a free band of energy to cover basic needs – would spur a sudden interest in insulating UK’s notoriously cold damp homes.

Roni Marsh, Money Advice Team Leader at South West London Law Centres, said:

We are seeing clients on prepayment meters who do not have the funds to turn their gas or electric on. South West London Law Centres provides debt advice to help people reduce debts and access additional funds but this does not fix the fact that someone has not got enough money to afford to buy gas or electric.

We are living in the age of heat or eat and we cannot fix this for a client on a limited income.  South West London Law Centres believes that a social tariff is needed. To have to tell someone that there is no way we can reduce their fuel costs any further and give them a foodbank voucher to try and free up the money they would spend on food so they can spend that on fuel instead is not a long term option.

Laura Santamaria, Chair for Fair Energy Campaign, added:

Should a family in a developed country have to choose between heating or eating? As the situation keeps spiralling out of control, the number of households under fuel poverty is increasing exponentially. This unprecedented scenario in UK history has set the scene for urgent action towards energy justice and deep sector reform. Access to clear, affordable energy is a human right.

Jan Shortt, General Secretary of the National Pensioners’ Convention said:

The NPC has also written urging Ofgem and the Chancellor to work together to urgently look at immediate and long term measures to help those struggling with fast rising energy bills. We don’t believe the Chancellor’s emergency measures are enough to deal with the ongoing hikes in energy prices and we need to see a long term strategy from the government and Ofgem.

The NPC is also asking for: the reduction or removal of Standing Charges; a permanent £500 increase in the Winter Fuel Allowance; an end to Price Discrimination against those who can’t pay online, or by Direct Debit, or who don’t have Smart Meters; the removal of 5% VAT on energy; and major investment in insulation of cold, damp housing.

Georgia Whitaker, Oil Campaigner at Greenpeace UK, added:

It’s no wonder the UK is in the mess it’s in given the incessant short-term thinking in government. Yes, urgent financial support is desperately needed for the millions struggling to pay their bills. But without tackling the root-cause of fuel poverty, this crisis is only going to get worse. It doesn’t take a genius to work out that providing warm homes that waste less energy and cost less to heat will bring down bills, so why is the government so reluctant to invest in improving the efficiency of people’s homes?

A spokesperson for the Chartered Institute of Housing added:

We welcomed the Chancellor’s emergency measures to support people in fuel poverty, but they were only a sticking plaster. The best way to help keep people’s energy bills down, now and in the future, is to invest in a national insulation scheme to tackle energy inefficiency in our homes, which are the leakiest in Europe. Landlords need support from the government to do this effectively and at pace, including funding and programmes to tackle the shortfall in skilled retrofitters across the country.

ENDS

Full copy of the letter to sent to the Chancellor and copied to the Secretary of States at DWP, LUHC and BEIS:

The End Fuel Poverty Coalition welcomes the support you outlined in the House of Commons on 26 May 2022.

Two important principles have now been established:

  • That financial support for those in fuel poverty will be needed in the short-term
  • That the Government has identified the means with which to fund this significant support

However, we have heard concerns from our Members that there are important questions which remain to be answered by your officials in relation to the support on offer.

There are ten key areas we need clarification on:

  1. How will the scheme work to provide funding to the millions of people on pre-payment meters given the challenges of previously used voucher systems?
  2. What steps can be taken to support those in the Private Rented Sector to ensure landlords pass on the full savings of bills (especially in Multiple Occupancy Households)?
  3. What support will be available to the estimated 200,000 people living in Park Homes?
  4. How can financial help reach those households who do not receive electricity bills?
  5. What will the impact of financial support be on the care charges disabled, elderly and vulnerable people are assessed on?
  6. What will the impact of support be on the benefits cap and the minimum income guarantee?
  7. How will access to the Household Support Fund be made easier and consistent across the country?
  8. What other steps will the Government be taking to ensure full take up of benefits this winter?
  9. How can those living off-gas and people on heat networks be better supported by the Price Cap?
  10. What further steps can be taken to support those households already in fuel debt as a result of recent price increases?

We would also request re-assurances that customers will no longer be penalised for the failures in the energy market through standing charges or other costs added to energy bills.

Members of the End Fuel Poverty Coalition have ideas to help address the above questions and we would welcome the opportunity to facilitate a meeting with you and Coalition Members to discuss the proposed solutions.

We are aware that you will have already heard from our Members that we need urgent, co-ordinated, action to improve the energy efficiency of our homes. We would like to take this opportunity to support these calls and also ask you to prioritise funding for a  skills strategy to deliver the “retrofit army” needed to deliver the improvements needed.

We would also request that you recognise that the support provided will only seek to prevent additional homes entering fuel poverty (based on the predicted Ofgem price cap) and stop many of those in fuel poverty becoming utterly destitute. It will not fundamentally improve the situation of the 6m-plus households already in fuel poverty.

Therefore, we would urge you to make further statements to set out further financial support for people in fuel poverty this winter, announce funding for the action needed to improve the energy efficiency of our homes and ensure we have a secure, renewable-led, domestic energy supply.