Charity calls for cuts in energy bills to compensate for lack of investment in energy efficiency within the Budget

For immediate release

Charity National Energy Action (NEA) has today called for four immediate actions that can be taken by the UK Government and the regulator this winter to reduce energy bills for low-income working households. They say that despite the lack of any help in the Budget, their proposals will help ease the pressures on poorest domestic consumers until adequate investment in energy efficiency is introduced in the upcoming Comprehensive Spending Review (CSR). Peter Smith, Director of Policy and Research at National Energy Action, says:

Living in cold, damp and unhealthy homes continues to cause shocking levels of unnecessary hardship and premature mortality. Improving energy efficiency in homes is the most cost-effective and enduring solution to reduce needless energy costs, eliminate fuel poverty, boost economic growth and safeguard the environment. The potential to unlock these huge benefits was not seized in the Budget and so NEA are recommending four immediate actions that can be taken by BEIS and Ofgem to help make energy bills more affordable for millions of low-income working households this winter.

NEA launched its calls the day after the legislation that underpins the only remaining energy efficiency programme, the Energy Company Obligation, was passed in the House of Lords. The charity says that they hope this means energy suppliers and contractors can now start to deliver on the obligation this winter but the policy alone will not be enough to meet statutory targets.

Smith continues:

Although NEA doesn’t agree with the loose targeting or level of funding within the new ECO scheme, it’s crucial that the legislation has cleared Parliament and there is now no further delay to helping some of the most vulnerable people to heat their homes. But we know ECO by itself will not be enough to meet the Government’s own fuel poverty objectives.  The budget has clearly not changed or delivered on this challenge but we will continue to push for such a scheme within the Comprehensive Spending Review. In the meantime, we are hoping our four immediate actions can be taken by BEIS and Ofgem to help make energy bills more affordable for millions of low-income working households this winter.”

ENDS

Note to the editors

  1. For more information about NEA visit nea.org.uk.
  2. NEA’s full response to the ECO 3 consultation can be found HERE. The 10,580 fuel poor households expected to be helped by 2020 includes those that are privately renting. In England, this could leave an estimated 240,000 fuel poor households in F & G rated homes long after 2020. The calculation is based on the information within table 7: Estimated Progress Against Fuel Poverty Milestones within the BEIS ECO 3 Consultation Stage Impact Assessment, page 18.
  3. NEAs full briefing document “Reducing energy costs for low income working households” can be found HERE. NEA is calling for:
  • The GB-wide vulnerable customer Safeguard Tariff should continue alongside the Default Tariff cap and be extended to all households eligible for the Warm Homes Discount scheme. This support should endure after the Default Cap is removed.
  • The £140 rebate under Warm Home Discount scheme must continue for existing low-income pensioner recipients and be provided automatically to more low income working families, using powers under the Digital Economy Act to ensure better targeting.
  • Ofgem should investigate the setting of and recovery of costs within Fuel Direct repayments and standing charges to ensure low income consumers that may only top up their pre-payment meters rarely, don’t lose credit before they can access any energy.
  • If the Government choose to extend the current smart meter deadline, it must also work with the Competition Markets Authority (CMA) to investigate an extension to the Pre-Payment Meter price cap (regardless of how many SMETS 2 PPM meters are deployed before 2020).
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