The latest definition of fuel poverty, published in the Sustainable Warmth strategy in February 2021, outlined that it is now measured using the Low-Income Low Energy Efficiency (LILEE) indicator. A household is said to be fuel poor if it is living in a property with an energy efficiency rating of band D, E, F or G and has a disposable income deemed to be below the poverty line.
What does it really mean to be in fuel poverty?
Many of those in fuel poverty struggle to heat their homes adequately. There have been studies to suggest that the fuel poor are more likely to be living in cold and damp homes, which is a contributing factor in health issues such as respiratory diseases, heart diseases, circulatory diseases, and mental health problems.
It is a sad fact, that in 2021, some of the most vulnerable in our communities are struggling to afford a warm, comfortable home in the 21st century.
Together, we have a challenge to overcome. A challenge of eradicating fuel poverty so that people’s health within our communities is not impacted by a lack of warmth, cold and leaky homes.
Households are impacted by ever rising gas and electricity bills which need adequate insulation and heating measures.
But what is the Government doing about it?
Government fuel poverty targets
The Government has set out targets to improve the energy efficiency of homes that households in fuel poverty live in.
The Government’s statutory fuel poverty target for England is to ensure that as many fuel poor households as reasonably practicable achieve a minimum energy efficiency rating of band C by 2030, with interim targets of band E by 2020, and band D by 2025.
Current projections according to BEIS
Figures from the Department for Business, Energy, and Industrial Strategy (BEIS) suggest the proportion of households in fuel poverty will fall from 13.4% or 3.18 million homes in 2019, to 12.5% or 3 million homes in 2021.
Key drivers of fuel poverty
There are three main areas that impact fuel poor households: energy efficiency, energy prices and incomes.
The government are looking to tackle fuel poverty through energy efficiency initiatives.
The current Energy Company Obligation scheme, otherwise known as ECO3, is designed to help save money on householder’s energy bills, reduce carbon emissions, and help the environment.
ECO3, is an obligation placed by the government on to the energy companies, to provide funding to qualifying households, for a range of energy efficiency measures such as insulation and boiler replacements. The introduction of Local Authority Flex, has meant a greater number of households can benefit from the scheme, depending on the local needs of the community they live in.
Installers, like Dyson Energy Services, have access to the funding through their bilateral agreements with the energy companies.
The next tranche of ECO (ECO4) is expected to start in March 2022. There have been other energy efficiency initiatives, some more successful than others.
The Green Homes Grant Voucher scheme, which was announced in the Summer Budget of July 2020, closed to applications shortly after its launch, on March 31st of this year. Those in receipt of certain benefits were eligible for a voucher covering 100% of the cost of the improvements, at a maximum of £10,000.
According to Ofgem, all the ‘big six’ energy suppliers announced price rises this year. For those customers on standard variable and default tariffs, they will see an annual increase on average of £96. These price rises came into effect from 1 April 2021.
Ofgem have urged consumers to save money on their energy bills by switching, to find the most suitable and competitive tariff for them.
The coronavirus pandemic has undoubtedly increased financial hardship for many people across the UK.
According to the Office for National Statistics, ‘following a period of employment growth and low unemployment, since the start of the pandemic, employment has generally been decreasing and unemployment increasing. However, there are signs of economic recovery’.
This combined with the announcement in April that energy bills are set to rise, will potentially mean thousands more people will possibly join those, already classed as living in fuel poverty.
Taking a holistic approach to tackling fuel poverty must be the solution. A joint up approach to the support available to fuel poor households is what is needed. Looking at energy efficiency initiatives to reach those most in need, addressing ever increasing energy bills and educating people on energy switching whilst working to address low incomes and unemployment.