Energy Crisis
The energy crisis is unprecedented and is driving the cost of living crisis. In October 2021, 4.5 million UK households were in fuel poverty. As of 1 October 2023, there are 6.3 million.
Across the UK, cold homes are already damaging the lives of the poorest households.
Fuel poverty statistics explainer
Since the winter period of 2020/21 energy prices have soared from an average of £1,042 to now being £2,100 for a typical household. It’s estimated 6.6 million UK households are now living in fuel poverty.
How you can make a difference
As you are probably aware, we are in the midst of an energy crisis and you can make a difference by getting in contact with your MP.
We estimate that 6.6 million UK households are now in fuel poverty.
Advice on how to save energy
National Energy Action has developed a series of multi-lingual information leaflets to provide advice on how to save energy.
Leaflets include a home energy checklist, advice on electrical appliances and dealing with damp and condensation, among other topics.
Improving the energy efficiency of rented accommodation
We have known for too many years the worst conditions remain in the Private Rented Sector (PRS). Worrying recent evidence suggests any limited progress is now being reversed. This briefing explains the severe consequences of this.
Last updated November 2023
How much is the typical annual energy bill?
As of 1 October, the typical household pays £1,923 a year. National Energy Action estimates there are 6.3 million UK households in fuel poverty.
Energy bills will cost similar to what they did last winter in real terms, due to far less government support for energy bills, compared with last winter.
In Autumn Statement 2023, Chancellor Jeremy Hunt announced no new energy bill support for this winter. Polling by National Energy Action with YouGov revealed that 26% of UK adults – equivalent to 11 million people – say they have struggled to afford to pay their energy bills over the three months prior to the Autumn Statement.
Ofgem announced that the price cap will rise to £1,928 in January 2024 for a ‘typical’ household. At first glance, it might look like prices are only increasing slightly, but this is not accurate. That’s because Ofgem has just changed how it calculates ‘typical use’. Just three months ago this was a 2-3 bedroom household using 2,900kWh of electricity and 12,000kWh of gas a year. Now it’s based on a household using 2700kwh of electricity and 11500kwh of gas. It’s important to note the price cap isn’t a cap on the total bill but on the price per kWh of energy.
What has the UK Government done to support people with energy bills?
Energy bill support
- Cost-of-living payments – these will be spread throughout 2023-24 in several payments totalling £900 for people on means tested benefits, £300 to pensioners, £150 to households with disabilities
- £1 billion funding increase to Household Support Fund for local authorities to support those in need
Uprating benefits
- Households on Universal Credit and other legacy benefits will see an increase in these benefits in line with inflation
Energy efficiency
- Announced a target by 2030 cut demand by 15%, to achieve collective bill savings of £28 billion and £450 off household bills
- £6.6bn for energy efficiency committed in this parliament.
- New funding from 2025 of a further £6 billion. Department of Energy Security and Net Zero (formerly BEIS) Secretary of State Grant Shapps will launch a new energy efficiency taskforce shortly on how to deliver funding from 2025 onwards.
What has the Welsh Government done to support people with their energy bills?
In Wales, the Welsh Government provided an expanded package of targeted support in 2022/23 to help tackle the crisis.
This included an expanded £200 Welsh Fuel Support Scheme payment to help towards energy bills, regardless of how households pay for their energy and whether they use on-grid or off-grid fuels. Eligible households needed to claim this via their local council between 26 September 2022 and 28 February 2023.
A Wales-wide Fuel Voucher Scheme is still available. This is run in partnership with the Fuel Bank Foundation and is designed to help households in crisis who must pay for their energy in advance (on or off-grid fuels). Households may contact Advicelink Cymru on 0800 702 2020 to find out more.
Households in financial hardship can continue to apply for emergency assistance payments under the Welsh Government’s Discretionary Assistance Fund (DAF). This includes help to top-up gas and electricity prepayment meters, or oil and LPG. Visit gov.wales/discretionary-assistance-fund-daf for more details.
Our asks of the UK Government to help with the energy crisis
- Ensure announced support reaches those that need it.
- Despite the significant packages of support to date, National Energy Action believes there is still a need to increase financial support for the poorest households.
- Make the energy market fairer: introduce a social tariff for energy alongside the price cap in April 2024
- Help low-income households to clear utility debts through a new payment matching scheme, where the UK Government matches every pound that a household makes towards their utility debt repayments.
- Improve energy efficiency:
- Committing the remainder of the funding promised to upgrade fuel poor homes in the Conservative Party Manifesto – an increase of £1.4 billion into the Home Upgrade Grant Scheme to be spent before the end of this parliament.
- Setting tighter regulatory minimum energy efficiency standards for rented properties, so that they reach EPC C by 2030 at the latest.
What is the price cap?
The energy price cap puts an upper limit on the unit rate that suppliers can charge customers on default tariffs (also known as standard variable tariffs). It was introduced by the government and is administered and calculated by the energy regulator Ofgem. It applies to default energy tariffs, whether paid by direct debit, standard credit or a prepayment meter. Prepayment meter customers pay more than direct debit customers. That’s because Ofgem says it is more expensive for suppliers to service them.
The price cap limits the rates a supplier can charge for their default tariffs. These include the standing charge and price for each kWh of electricity and gas. It does not cap the total bill, which will change depending on how much energy you use. But Ofgem presents it in terms of an average user’s annual bill, to simplify things for the general public.
Our fuel poverty estimate
Our definition of fuel poverty is that a household is in fuel poverty if it needs to spend 10% or more of its income on energy in order to maintain a satisfactory heating regime. This gives a realistic picture of the scale of fuel poverty in periods of more volatile energy prices. The government’s estimates for England are based on the efficiency of homes, which is not sensitive to changes in energy prices. Our projections are broadly in line with robust analysis by the Resolution Foundation surrounding ‘fuel stress’. This is also based on the 10% fuel poverty metric, but for England only.
How did the energy crisis unfold?
To read about how we got to this point, please click here.
Standing charge
To find out more about the standing charge, please click here.
Where can I get help now?
If you or someone you know can’t afford to heat their home then we’re here to help. We offer a range of advice and support directly to people in need. We also offer help via frontline workers and other intermediaries. For advice and support on what you can do click here. Also, contact your energy supplier. You may also be entitled to access the Local Authority Assistance Fund or Winter Fuel Support Scheme in Wales.
For media enquiries please contact anna.cook@nea.org.uk