Tag: Ofgem

Outreach to understand prepayment meter scandal launched

A nationwide call for evidence has been launched to ask energy customers to share their experiences of moving to a prepayment meter (PPM).

People can submit their experiences through an online form which is being hosted on Citizens Advice’s website and is open until Thursday 4 May 2023. A phone line (0800 464 3374) is also available to take evidence and consumers can also submit evidence via charities they may already be in touch with.

The eight-week programme of outreach is part of Ofgem’s market review of prepayment meters and remote switching, to ensure suppliers are meeting their legal obligations in protecting customers.

As part of the wider review, the End Fuel Poverty Coalition has also submitted a response to Ofgem’s consultation on protections needed to help protect energy customers.

In its response, the Coalition re-iterated its call for a legally enforceable ban on the forced transfer of homes onto a PPM (by court order or smart meter transfer) as the only acceptable solution to this abuse of power.

Despite the current voluntary ban being put in place by Ofgem and the Chief Justice, there are still reports of energy firms using the threat of a court order imposed PPM to intimidate households.

Until Parliament can legislate for such a ban, the Coalition argued in its consultation response that Ofgem must ensure that there is no return to forced transfer to PPMs until:

  1. The full PPMs Market Compliance Review has concluded and suppliers have implemented all recommendations. 
  2. Revised licence conditions have been implemented (to extend more protections to vulnerable households and extend the definition of vulnerability).
  3. Confidence is regained that suppliers have in place processes to follow the existing and updated rules set by Ofgem.

A spokesperson for the End Fuel Poverty Coalition, commented:

It is vital that anyone with experiences of using a prepayment meter responds to Ofgem’s call for evidence.

Only by telling our stories of the abuses that have taken place are the regulators and MPs able to take action to demand compensation from energy firms and reform Britain’s broken energy system.

Next week the House of Commons Business and Justice Select Committees will hear evidence from key players in the prepayment meter scandal including a former magistrate, British Gas contractors and Ofgem.

Customers to see energy bills soar from 1 April

Despite the Ofgem price cap falling today, customers will see energy bills rise by 43% for the average household from 1 April 2023.

Under the Government’s Energy Price Guarantee, the level of support for all households will fall at the same time that the Energy Bills Support Scheme also comes to an end.

Over 70 charities and campaign groups have now called on the Government to scrap the energy bills hike, paid for by the estimated £11bn underspend in the Energy Price Guarantee budget.

The Ofgem energy price cap was £4,279 in January but it will drop to £3,280 in April because of falling wholesale prices. Under the Government support packages, the average household bill has been £2,100 but this will rise to £3,000 from 1 April.

And contained in the small print of the Ofgem announcement is further bad news for some consumers.

A spokesperson for the End Fuel Poverty Coalition, explained:

Not only will people’s bills actually go up from 1 April, but the Ofgem announcement today contains a sting in the tail for some households who do not pay by direct debit.

Households on pre-payment meters will continue to pay more for their energy with those on standard credit and Economy 7 tariffs also being hit. [1]

In addition, we have seen some regions pay significantly more for their electricity than others [2] and standing charges will increase for everyone by almost 10% [3] caused by the complex nature of Britain’s broken energy system.

This means some people will still pay even more, even if they use less energy.The Government must act to ensure that bills don’t go up, while also setting out a path to reform the energy market.

As prices soar, Greenpeace has also warned typical UK home could miss out on savings of £1,800 every year on their energy bills by the end of this decade unless the government ramps up plans to roll out insulation, and heat pumps. [4]

To help the public understand more about their potential savings, the charity has launched an Affordable Energy Calculator in partnership with Cambridge Econometrics at https://affordableenergycalculator.org/.

Georgia Whitaker, Climate Campaigner for Greenpeace UK, said:

Britain’s homes waste more heat than any in Western Europe. We can’t afford to carry on wasting energy like this in a cost of living crisis. Greener homes would keep communities warm and healthy and save us all money.

We need the government to support home improvements like insulation and heat pumps to lower bills, boost the economy, and help the UK reach our climate goals. Heating our homes really shouldn’t cost the earth.

Our Affordable Energy Calculator shows how much individuals and communities across the UK could save if the Government commits to invest in our homes in the upcoming Energy Bill.

Ruth London from Fuel Poverty Action, commented:

Public anger is intense and support is growing for a whole new system, Energy For All.

This would mean no standing charges, a free band of essential energy so that no one freezes to death with excess energy use charged at a premium.

This would be funded by windfall profits and end to fossil fuel subsidies with accelerated energy efficiency and renewables expansion to reduce cost of the proposals.

ENDS
[1] Standard credit +6.2%, Economy 7 +4.1%, PPM +1.4% (source Ofgem letter p3)
[2] For example, electricity in North Wales & Mersey is 6.7% more expensive than in the East Midlands (Ofgem default tariff cap level document, based on direct debit payment and standard average use on single point meter).
[3] Based on dual fuel, direct debit increase 9.7%, Standard Credit 9.4% and PPM 7.8% (Ofgem default tariff cap spreadsheet table 1b, column BO compared to BP)
[4] This figure was calculated using the most common dwelling type (owner-occupied, three bedroom, semi-detached) in England and Wales, according to ONS data*, with the most common characteristics (eg condensing gas boiler central heating) for that type of dwelling. This type of dwelling would see a £1,832 reduction per year, or 64.7%. The number is not a mathematical average of all UK homes. Other dwelling types show similar savings in percentage terms, so a one bedroom council flat would see a £606 reduction (59.5%) and a four bedroom detached house would see a reduction of £3,579 (64.9%).

 

 

3.2m pre-payment meter customers left without heat

New research has found that one person every 10 seconds ran out of credit on their pre-payment meter last year because they couldn’t afford to top up.

The findings put more pressure on the Government to act on the pre-payment meters scandal as a total of 3.2 million people across Great Britain were left without heat or light according to Citizens Advice.

In debates in Parliament this week, the energy and justice ministers were put under pressure on the issue of forced transfer of homes onto pre-payment meters. Caroline Lucas MP and Rachael Maskell MP both raised the issue in debates, while a Bill to ban the practice has been put forward by Anne McLaughlin MP.

Previous research for the Warm This Winter campaign found that a third of pre-payment meter customers are now living in a cold damp home.

The energy regulator, Ofgem, has rules that means certain groups, such as disabled people and those with long-term health conditions, should not be forced onto a prepayment meter. In October, Ofgem warned suppliers that not enough was being done to identify customers in vulnerable circumstances before installing a prepayment meter.

But Citizens Advice data reveals that in the month following Ofgem’s intervention more than more than 470,000 struggling households including a disabled person, or someone with a long term health-condition, were cut off from their energy supply at least once.

Citizens Advice also found that more than one in five (19%) prepayment meter customers were cut off in the past year then spent at least 24 hours without gas or electricity, leaving them unable to turn the heating on or cook a hot meal.

The End Fuel Poverty Coalition has been calling for a ban on the forced transfer of homes on to pre-payment meters. A spokesperson for the Coalition commented:

The staggering extent of the prepayment meters scandal is now clear. Energy firms and the Government should hang their heads in shame.

Magistrates who approved court warrants in bulk for energy firms to install prepayment meters should also reflect on their role in this injustice.

A full ban on the forced transfer of customers to prepayment meters, including via smart meter mode switching, is now the only acceptable course of action.

Citizens Advice has now joined the calls for a total ban on forced prepayment meter installations until new protections are introduced, ensuring households can no longer be fully cut off from gas and electricity.

The charity reports it has seen a 229% increase in the past year in the number of people coming for help who can’t afford to top up their prepayment meter.

Ofgem to face legal challenge as price hike news sinks in

As news about the October Ofgem 80% price hike sinks in, and estimates from Cornwall Insight suggest it could reach £5,387 from 1 January 2023, further End Fuel Poverty Coalition members have reacted to the news.

The Good Law Project has confirmed that, as a result of the announcement, it will sue Ofgem over its decision. Jo Maugham, Director of Good Law Project said:

The announcement today will devastate families. Just who and what is Ofgem for? Do not be fooled. This is a choice. And the choice they’ve made is to let low-income consumers and small businesses bear the brunt of this crisis.

We believe Ofgem can – and should do more. We intend to put the question before the High Court, and will ask for a fast-tracked timeline to reflect the urgency of this crisis.

Repowering interim CEO, Felix Wight, commented on the price hike:

Today’s news is devastating for millions. But let’s be clear – this is not an energy crisis- it is a fossil fuel crisis, and a political crisis.

Successive governments have failed to respond to the clear majorities calling for decisive action on climate change, and we have been taken down a strategic cul-de-sac where we have lost control of our energy costs.

Many of us have seen this coming, spoken up, and been ignored. We now find ourselves in a hostage situation with fossil fuel producers, with the government considering paying up to £100Bn in ransom.

Putting the burden on individuals to take the hit for the government’s own failure to plan is callous and risks a breakdown in the fabric of our society and economy.

The community energy movement offers a clear alternative- a bottom-up approach to making our 28 million homes more comfortable and affordable, the opportunity for everyone to benefit from home-grown renewable energy, and a model that re-invests in people and communities.

We know it works because those communities who have been able to set up their own energy infrastructure are benefiting right now from fossil-free power that helps protect them from this desperate scramble for natural gas at any price.

Spending just a fraction of the £100Bn fossil fuel subsidy to support community owned energy would start a genuine transformation in our energy landscape and put power where it belongs- in the hands of households across the country.

The time has come to face down the politicians and companies that have lost our trust, and start building an energy system that works for everyone.

Caroline Abrahams, Charity Director at Age UK, said:

Although the ballpark figure for the new price cap had been trailed in advance there will be many older people for whom today’s announcement is completely new and a huge shock. Millions of pensioners will now be coming to terms with the reality of what it means for them: the prospect of trying somehow to get through the autumn and winter with prices soaring and yet with very little flex in their fixed incomes. It’s a truly frightening prospect and one that most could not have prepared for, and never expected to face at this point in their lives. I think a lot of older people will be utterly bewildered that it has come to this and will also feel badly let down, and I can’t say I blame them.

The new Prime Minister must make their first act providing additional support for the millions of households in our country whom rising inflation is set to overwhelm, among them many pensioners. We are fast approaching a national emergency which will leave a significant proportion of the population unable to afford even a basic standard of living. Every day older people are telling us how scared they are; they need urgent reassurance from the Government that they will not abandon them.

It’s later than the Government thinks: we understand that there is essentially a transition underway between one Prime Minister and the next, but every day the economic forecasts seem to worsen and yet there is no clear word from the centre about how they will respond. Unfortunately, this is increasing the sense of insecurity many older people feel.

That’s why the new Government must act quickly to give older people hope and confidence. In the meantime, it would be extremely helpful if both candidates made it clear that they will stand by those with most to fear from soaring inflation, among them many pensioners, over the difficult months to come.”

Adam Scorer, National Energy Action (NEA) chief executive, added:

The scale of harm caused by these price rises needs to sink in. A warm home this winter will be pipedream for millions as they are priced-out of a decent and healthy quality of life.

We’ve all seen the estimates from Cornwall Insight for the past months. Government has had ample time to prepare an intervention to match the challenge. We know who gets hit hardest, what impact it will have and how to get money into the pockets or off the bills of the most vulnerable.

Without bold action to support the most vulnerable and those on the lowest incomes, this will effectively prise their fingers from the cliff edge and push them over the precipice.

The government needs to immediately upgrade the household support package it first announced back in May. Households need money in their pockets to weather this storm or we are going to see millions in dangerously cold homes, suffering in misery with unimaginable debt and ill health.

Even with a mild winter, millions are facing a big freeze. Action is needed now to prevent the bleakest of winters.

A new Warm This Winter campaign, backed by the End Fuel Poverty Coalition, has also launched a petition to call for urgent Government action.

Price cap confirmation like a dagger to the hearts of millions

End Fuel Poverty Coalition members have reacted to news that Ofgem has confirmed the price cap will increase from £1,971 to £3,549 from 1 October 2022. In winter 2021/22 the cap was set at £1,277.

For pre-payment meter customers, the rise will be even more punishing with the average annual bill for these 4.5 million customers due to go up to £3,608.

In response, a new campaign backed by the End Fuel Poverty Coalition, Warm This Winter, has launched a petition to call for urgent Government action.

A spokesperson for the End Fuel Poverty Coalition commented:

Today’s Ofgem price hike is like a dagger to the hearts of millions of people up and down the country.

Sarah MacFadyen, Head of Policy & External Affairs at Asthma + Lung UK, said:

Ofgem’s latest energy cap price hike risks pricing people with lung conditions out of breathing. Winter is already the deadliest season for people with lung conditions, and the cost of living increase will only make this worse and put seismic pressure on the NHS at a time where people, especially those with lung conditions, need it more than ever.

Cold air is a top trigger for people living with lung conditions like asthma and COPD, leaving people fighting for breath. Cold weather can also contribute to mould and damp – a trigger for around 2.5 million people with asthma in the UK. The best way for people with lung conditions to stay well is to ensure they take their medication and keep their houses warm, but rising costs could leave people choosing to skip their medication or turn off their heating.

As a charity we’re already seeing a 150% spike in calls to our helpline for support with financial and welfare benefits advice, and we’re worried that as energy prices rise we’re going to see a sharp decline in the country’s lung health this winter. With the triple threat of freezing homes, colds and flu, and expected COVID-19 peaks, we’re running the risk of yet another major healthcare crisis. As part of the End Fuel Poverty Coalition, we’re calling on the UK government to provide more financial support for people with long-term health conditions and on low incomes, so they can afford to keep their homes warm this winter.

Graham Duxbury, Groundwork’s UK Chief Executive, said:

As a charity that supports people living in fuel poverty, we are alarmed at the volume of requests for help that are coming through. With more price rises due over the winter, we are deeply concerned that those most vulnerable won’t have access to help they desperately need.

The latest forecasts make it clearer still that urgent action is needed to help people cope with this worsening crisis which will lead to unprecedented hardship. 

Energy companies, charities and independent experts all agree that the measures in place are not enough. As well as more emergency financial support and a long-term commitment to improving the energy efficiency of our homes we also need more – and better coordinated – advice. Groundwork’s Green Doctor service is one of many trying to help people through practical advice and emotional support, but these services are too often reliant on short-term funding with complex rules.

What we need is simpler, more stable funding models so that we can help those worst off to make best use of the help they’re getting and preserve as much warmth as they can this winter, but also help those who are being pitched into fuel poverty for the first time.

Ruth London from Fuel Poverty Action, added:

These astronomical price rises are completely unnecessary. Energy costs no more to produce than it did last year. People will go without food to pay these bills, while the energy generators and suppliers make a killing: our money goes straight into wealthy shareholders pockets, and into further investment in expensive, polluting, and climate-wrecking oil and gas. The government is adding to this heist by increasing the millions of pounds they daily pay in subsidies to fossil fuel giants while offering only sticking plasters to UK residents.

They must urgently insulate homes, switch to cleaner, cheaper renewable sources of energy, and reverse the gross injustices of the present pricing framework, including high prepayment prices, high standing charges, and more.

Fuel Poverty Action is advocating Energy For All – a completely new pricing system, where every household will receive, free enough energy to cover basic needs. It will be paid for by higher prices for profligate energy used, windfall taxes, and an end to fossil fuel subsidies. Our petition, with over 408,000 signatures will be delivered on 19 September.

Ofgem has not been protecting customers, and with the Good Law Project we are challenging their priorities. Without radical change, many more thousands will die this winter in cold homes.

Following reports that rural areas will be heavily affected by the rising price cap, Richard Quallington, Executive Director of Action with Communities in Rural England said:

The fact rural parts of the country are some of the worst affected is no surprise to us. Much of the housing stock in the countryside is older and more difficult to heat and many households still depend on heating oil which is not subject to the price cap.

This, combined with typically lower rural incomes and the cost of travelling to access jobs and services is creating the perfect storm in the countryside.

The challenge for policy makers is twofold. They need to find ways of getting more financial support to the people who most need it, and this requires more creative localised responses in rural communities. And there also needs to be a longer-term plan for improving the energy efficiency of homes which is suited to the fabric of older buildings. The needs of rural communities cannot be overlooked.

Ross Matthewman, Head of Policy and Campaigns at the Chartered Institute of Environmental Health, said:

Following reports that Ofgem is to announce yet another crippling increase in energy bills, we urgently call on the UK government to intervene to protect millions of households being plunged into fuel poverty this winter.

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 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. Energy efficiency measures also  play a key role in fighting climate change and reducing carbon emissions.

The End Fuel Poverty Coalition spokesperson concluded:

As a result of the decision, parents will be unable to feed their children, the sick and elderly will be condemned to worsening health, disabled people will go without vital medical equipment and households will be forced into poverty for the first time in generations.

All the solutions lie at the Westminster Government’s door, yet it is silent in the face of this looming disaster.

We need emergency financial support, especially for the most in need. But we also need reform to Britain’s broken energy system as well as increased support for energy efficiency measures and homegrown renewables.

Further reaction and revised predictions on the levels of people expected to be in fuel poverty will be published by the Coalition in due course.

The Warm This Winter petition can be signed online: https://www.warmthiswinter.org.uk/#petition

Ofgem criticised for standing charge decision

Campaigners have written to Ofgem criticising the “gross injustice” of the current energy bills standing charges regime.

Standing charges make up a portion of the energy bill which every household user pays, regardless of how much energy they actually use.

Last week, Ofgem confirmed that the cost of market failures (e.g. energy firms collapsing) would continue to be recouped from consumers through the standing charges.

The decision comes just weeks after Ofgem confirmed an “inhumane” increase in energy bills will take place in January 2023 as well as this October. Ofgem are also now facing the prospect of legal action against its decisions following a notice of action from the Good Law Project last week.

Now Fuel Poverty Action and Disabled People Against Cuts have together written to Ofgem CEO Jonathan Brierley about present standing charges, including loading the cost of failed suppliers onto this part of people’s bills.

The letter states:

It is appalling that yet again Ofgem is punishing low income customers for its own failed regulation and the upside down priorities of the energy industry.  … This is consistent with the blinkered approach that has led you to give “too much benefit to companies at the expense of consumers”, in the words of  Christine Farnish, the Ofgem director who resigned recently.

Ofgem has claimed that high standing charges are the only way to protect high users, some of whom are people with health needs for electricity, e.g. for electrical medical equipment.

But the two groups suggest that Ofgem’s obligation towards vulnerable customers is being abused as an excuse for policies that impoverish and endanger thousands of people, including many who are disabled people. 

They name instead several alternative ways to protect people with high energy needs – without impoverishing vast numbers of low income customers. 

With Fuel Poverty Action’s proposal of Energy For All (e4a) each household would be entitled, free, to enough energy to cover basic needs, but people would pay a higher tariff for what they use above that amount. This would offer much needed security to all – including those who need more because of their health, disabilities, housing conditions, or family size. It would be paid for by the higher per-unit tariff on excess use, by windfall taxes and by ending the millions of pounds now poured daily into fossil fuel subsidies. 

Other options listed  include extensions of the Warm Home Discount, social tariffs, better disability benefits, and good safe insulation for vulnerable customers.  And they say that companies that cannot fulfil their purpose of providing the energy people need at a cost they can afford, could – and must – be brought back into public hands.

Ruth London from Fuel Poverty Action commented: 

Instead of looking at real, proportionate, workable changes to the current upside down pricing framework, Ofgem has chosen to continue hitting low income users harder than affluent neighbours. The standing charge means that however much they cut down their usage many people will never be able to pay their bills.

Paula Peters of DPAC says:

I’m a low energy user because I am terrified to switch it on and worrying about costs all the time. It’s making me permanently anxious as it is all of us. Last winter I was in a lot of pain with a cold house.  I needed NHS intervention: a steroid injection and a Nebuliser at A & E.

Decision on January price increase branded inhumane

Ofgem have confirmed that it will introduce a quarterly price cap increase on the energy bills of millions of people.

A spokesperson for the End Fuel Poverty Coalition commented:

Households will face a two-stage cost of living crisis this winter, thanks to Ofgem’s confirmation that energy bills will go up in October and again in January.

From October, millions of families across the country will face the real prospect of skipping meals to pay for energy, older people will shut themselves into one room to save on heating and disabled people will be unable to afford to charge vital equipment, such as electric wheelchairs.

Then in January, they will be asked to pay even more for their energy.

Ultimately, this decision will force more people into fuel poverty in the middle of winter, causing additional stress on the NHS and it may ultimately lead to increased levels of excess winter deaths this year. It is simply inhumane.

It’s clear that the Government and the Conservative Party leadership hopefuls just don’t get the scale of the problem facing the country, nor the public anger at rising bills. They are running out of time to act.

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.

The decision comes after a week of massive increases in profits for energy firms, but with Centrica warning that its profits in its British Gas consumer division were hit by it having to ‘hedge‘ buying of energy due to the previous six monthly nature of the price cap regime.

Ross Matthewman, Head of Policy and Campaigns for the Chartered Institute of Environmental Health, said:

Ofgem’s decision to introduce a quarterly price cap confirming household energy bills for millions of people will increase substantially in the depths of Winter is a further blow to those already struggling amidst this cost-of-living crisis.

Industry experts estimate that the typical households would be faced with energy bills of £3,358 from October, then £3,615 from January 2023. This is up from average energy bills of £1,400 a year in October 2021.

Ofgem’s principal duty is to protect the interests of existing and future consumers. Following today’s announcement which will plunge millions into fuel poverty, it is clear that it is failing in its duty to consumers.

UNISON head of energy Matt Lay said:

The government must stop pretending it’s done enough. Support for consumers has so far been pitiful. Other European governments have been both swifter and bolder to lessen the blows from big bills.

All but the richest consumers face a terrifying prospect this winter. Many simply don’t have the means to pay. Swift and radical government action is needed to cap the horrific price hikes predicted. Otherwise, there will be a crisis of unimaginable proportions.

End Fuel Poverty Coalition calls for further Ofgem action

The End Fuel Poverty Coalition has called on Ofgem to instigate five urgent reforms to the energy market to help the millions of homes in fuel poverty.

In a letter to the chief executive of the regulator, the Coalition calls for Ofgem to abandon plans to introduce a quarterly price cap increase in January 2023 which will penalise households in the depths of winter.

It also argues that changes to the price cap must be made to support those on pre-payment meters and add consumer protection to consumers who live off-gas and on heat networks.

As record numbers of households face fuel poverty this winter, the Coalition also calls for Ofgem to work with energy suppliers to create a package of additional support from suppliers for this winter.

The package suggested would be similar in scope to that introduced during the Covid pandemic, but enhanced in its ambition given the numbers of people expected to be in fuel poverty this winter and extend to debt relief rather than deferral.

The Coalition also calls for urgent reform of the regressive and punitive standing charges regime that penalises the most vulnerable.

Longer-term, the Coalition has formally requested that Ofgem reviews the operation of the price cap and works with consumer groups to set out reforms to the market that would offer more support to those in fuel poverty.

Campaigners have urged the regulator to consider the introduction of a price ceiling (i.e. a “super cap” set at current levels over which consumers will not have to pay for fair usage) and the introduction of a social tariff or “energy for all allowance.”

A spokesperson for the End Fuel Poverty Coalition, commented:

With a new political will to address the challenge of the millions of homes fuel poverty, we need to see Ofgem taking action to better support households across the country.

Ruth London from Fuel Poverty Action, said:

Ofgem has supported higher charges for people on prepayment meters, and has added to the burden of the standing charge element of bills. Both force people on low incomes to pay for energy at much higher rates than the wealthy. The current crisis makes it urgent to reverse this grotesque injustice and bring in Energy For All – a free band of energy to make sure that everyone can keep warm and keep the lights on.

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

While we welcome new measures of support, these are only short-term sticking plasters. To help tackle soaring energy bills and cold homes we need a longer-term, large scale home retrofit programme. This must include a green skills strategy to ensure there are enough people to do the work across all trades. We also need more support for energy advice services. CSE’s energy advice line calls are at an all-time high, and it’s going to be another tough winter for so many people unless urgent action is taken.

Rhiannon Hughes, South West London Law Centres, commented:

Some people on prepayment meters do not have the funds to turn their gas on. South West London Law Centres provides debt advice to help people reduce debts and access additional funds but there needs to be permanent solutions. 

The current system is forcing people into crisis and although advice for fuel bills is critical – a better solution is needed. The high cost of services charges on gas prepayment meters mean that people like my uncle disconnect.

My uncle who is partially sighted, a pensioner and works can not afford to put any money on his prepayment meter, when he does have a bit more cash he tries to turn on his gas for heating but because the service charges have been piling up, it has caused so much debt on the meter that any money he puts on will be swallowed in debt repayment, not on heating.

It is already an unjust situation that is due to get worse so needs urgent reform.

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

The NPC has also written to Ofgem and the Chancellor asking them to work together to urgently look at immediate and long term measures to help those struggling with fast rising energy bills. We are calling for a number of specific actions before the price cap rises again in October to a shocking average of £2,800 a year.

NOTES

Full text of the letter to Jonathan Brearley, Chief Executive of Ofgem, also copied to the Secretary of State for Business, Energy and Industrial Strategy and the Chair of the Commons BEIS Committee:

The End Fuel Poverty Coalition would like to thank you for your appearance at the Commons BEIS Committee which sparked the financial support outlined by the Chancellor on 26 May 2022.

With a new political will to address the challenge of the millions of homes in fuel poverty, we would also request that Ofgem reviews the areas where the regulator could better support households across the country.

First, we would urge you to abandon plans for a quarterly price cap and instead move to a three-times a year (at most) model. This would ensure more flexibility in the cap, but also mitigate a devastating January price increase, as predicted by Cornwall Insight, in the middle of winter.

Second, we need to see reform of the price cap itself – especially so that it does more to help those on pre-payment meters and is extended to cover people off-gas and on heat networks.

More broadly, we also need to see Ofgem lead the way to ensure better support for vulnerable customers, including a package of additional support from suppliers for this winter.

This support should be similar in scope to that introduced during the pandemic, but enhanced in its ambition given the numbers of people expected to be in fuel poverty this winter. We would also welcome Ofgem’s views on how it can ensure no-one is disconnected this winter or abandoned by their supplier.

We also need urgent reform of the regressive and punitive standing charges regime that penalises the most vulnerable. These charges should be reduced. In addition, customers should no longer be penalised for the failures in the energy market, which we will highlight as an issue to the Treasury.

Finally, in the longer-term we would request that Ofgem reviews the operation of the price cap and works with consumer groups to set out reforms to the market that would offer more support to those in fuel poverty. This could include the introduction of a price ceiling (i.e. a “super cap” set at current levels over which consumers will not have to pay for fair usage) and the introduction of a social tariff or “energy for all allowance.”

We would welcome the opportunity to speak to you about these issues at a future meeting of the End Fuel Poverty Coalition.

Coalition condemns utterly devastating price rises

A spokesperson for the End Fuel Poverty Coalition, has commented on Ofgem’s estimates that the price cap will increase to £2,800 from 1 October 2022 and predictions that 12m households could be in fuel poverty across the UK this winter.

This news will be utterly devastating for millions of homes currently in fuel poverty – and for millions more households who will now spend this winter struggling to keep themselves warm.

Fuel poverty becomes a public health emergency in winter and the hidden cost of the UK Government’s continued inaction will be felt in a collapse in the mental health of those in fuel poverty, increased pressure on the NHS from those with health conditions affected by damp properties and excess winter deaths caused by cold homes.

Unless the Government acts now, it will have blood on its hands this winter.

The Government must urgently impose a windfall tax on energy production firms to help those most in need, invest in a Great Homes Upgrade to improve energy efficiency of buildings and deliver a renewable-led secure energy infrastructure.

James Taylor, Executive Director of Strategy at disability equality charity Scope which are members of the Coalition, said:

The impact of the price cap rising by £1,500 in a year will be horrific. Many disabled people are already forced to commit a large amount of their income to energy costs.

Disabled people often rely on energy intensive equipment like electric wheelchairs, electric hoists, or monitors.

We’ve heard from disabled people who must choose between charging vital equipment and heating their home. Others are going without food so that their children can eat.

Our Disability Energy Support service has been inundated by disabled people in crisis with nowhere else to turn.

Disabled people cannot wait any longer for Government intervention. We need to see benefits rise in line with inflation, disabled people included in any expansion of the Warm Home Discount and a further increase in funding to the Household Support Fund.

In comments on Twitter, National Energy Action also described the proposed increases as catastrophic.

Coalition reacts to “sky-rocketing” energy prices and “woeful” Government response

Members of the End Fuel Poverty Coalition have been reacting to news of the latest energy price hikes and subsequent Government efforts to partially offset the consequences.

The latest estimates from the End Fuel Poverty Coalition predict that 6.3m households are expected to be in fuel poverty from 1 April 2022 – an increase of 2.1m on previous estimates which took account of the last Ofgem price rise in October 2021.

In addition, a group of civil society organisations have issued a united call for the Government to take further immediate action and a national protest is due to take place in London on Saturday.

Tamara Sandoul, Policy and Campaigns Manager, Chartered Institute of Environmental Health:

This has already been a difficult Winter for many households across the UK, with a cocktail effect of higher inflation and higher energy prices. This huge rise in the cost of energy will push many more people into fuel poverty and could put them at risk of health conditions caused by living in a cold home.

The Government also needs a long-term investment strategy into retrofitting homes to make these much more energy efficient and work to reduce its reliance on fossil fuels going forward.

William Baker from Solutions to Tackle Energy Poverty:

This announcement couldn’t come at a worse time. It coincides with a substantial increase to National Insurance, will inevitably exacerbate the cost of living crisis many low income households are facing and will increase reliance on food banks and fuel vouchers – already at record levels. We need a comprehensive package of Government support to both address high energy prices and improve the energy efficiency standards of our homes.

Connor Schwartz, climate lead at Friends of the Earth:

The skyrocketing price of gas will now push people into precarious financial positions, and spells disaster for those already struggling to meet the rising cost of heating their home. The government must ensure sufficient support for anyone already finding it hard, or who are at imminent risk, from these hikes.

We need to address the root cause and that means ending the cause of the crisis: reliance on gas. No mistake, this will be a year-on-year problem unless the government is radical now. The best time to invest in renewables and roll out a huge home insulation programme was 20 years ago, governments didn’t do it then, the next best time is right now.

 Mike Thornton, chief executive, Energy Saving Trust:

We know the additional increase to the energy price cap, alongside higher living costs, will be extremely worrying for people across Britain. With the number of households who find themselves in fuel poverty expected to rise, Government must expand on emergency measures to support those most in need.

As well as the need for immediate action and short-term support, the current crisis emphasises the importance of improving the energy efficiency of the UK’s housing stock in the long-term. Alongside this, we need to invest significantly in renewable energy – including low carbon heating.  Energy efficiency and more renewables are the best ways to protect everybody against volatile gas prices and rising bills in the long-term.

Tackling the current energy crisis must also go hand in hand with meeting net zero ambitions. Reducing our reliance on fossil fuels will minimise our exposure to the volatility of the global energy market and shape a greener and more affordable energy future. Alongside many other mission-led organisations, we’re asking for committed Government investment and clear action plans to scale up home insulation and renewable energy so we can be less reliant on gas in the future.

Fuel Poverty Action co-director Ruth London:

The energy market as it stands is not fit for purpose – it does not give people the energy they need to keep healthy, or the security to plan for the future in difficult times.

We’re asking that the government to introduce “Energy for All” – a universal, free amount of energy to cover people’s basic costs like heating, cooking, and lighting.

This would give us all the security we need, taking account of people’s actual needs according to their age, health, and housing.

Adam Scorer, Chief Executive of National Energy Action (NEA): 

These energy crisis measures are woefully inadequate and will leave those on the lowest incomes and in the least efficient homes in deep peril. 

Government had an exam question: How to protect the most vulnerable from a devastating rise in the cost of energy? While their plans are not without merit, they fail this test by turning away from targeted measures to help the poorest energy consumers. 

We needed deep, targeted support for the most vulnerable. We have shallow, broad measures for all. That simply does not work.

The depth of support is not proportionate to the increases. A household paying by prepayment will still have a £500 increase when you take into account rises from October 2021 and April 2022. 

The rebates on Bills and Council tax are not sufficiently targeted, too small and too complex.

We expect the government will have no choice but to return to the issue of spiralling fuel poverty and another price rise later this year. By then they’ll be playing catch-up and great harm will already have been done.

Ian Preston, director of household energy at the Centre for Sustainable Energy (CSE):

People are frightened of getting into debt. Someone we support on our advice line contacted us this morning to say they wouldn’t be able to put the heating on anymore. This is going to be the case for millions of people across the country.

We’ve calculated that this energy price increase each month is about the same as a low-income household would spend on groceries in a week. So to pay for the increase is essentially the same as asking them to go without food for a week every month.

We need to literally insulate people from the impact of future energy price increases! If we insulate our homes and buildings well, they’ll become more energy-efficient – there’s a range of measures available for different budgets and we can support people with finding grants.

Members also took to Twitter to express their concerns: