NEA warns of further increases to energy price caps

Following the recent exceptionally cold weather across the UK, with some temperatures reaching minus 14oC, today Ofgem has announced an increase to both the standard tariff cap and prepayment meter cap. Charity, NEA warns further increases to energy price caps will hit millions struggling to heat their homes. 

Adam Scorer, Chief Executive of fuel poverty charity NEA said: “The recent freezing weather, coupled with the likely energy company responses to the higher caps, will have a hugely damaging impact on the most vulnerable in our society. Whilst Ofgem’s caps are required to reflect the underlying costs of supplying energy, higher prices will inevitably pile yet more pressure on the millions who have no choice but to suffer in cold and dangerous homes.

“Last winter, cold homes contributed to record levels of excess winter deaths and chronic ill health. We estimate over 10,000 needless deaths were due to vulnerable people, often struggling with existing ill-health, being unable to heat their homes adequately, if at all. Many others are adopting unsafe coping strategies which create huge pressures and needless increased costs for our stretched health and social care services. In itself, the SVT price cap doesn’t make this situation any worse, but it can’t do much to make it better either. An SVT price cap cannot do the necessary heavy lifting in tackling fuel poverty.

“This year the UK Government will revise its fuel poverty strategy and publish its Comprehensive Spending Review. The fuel poor have slipped down the list of energy priorities. Last winter showed  the cost of that slippage.  This is an opportunity to put the focus of regulation, policy and  investment back on the most vulnerable, who pay the greatest price and need the best protection.”

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Note to editors

  1. NEA works across England, Wales and Northern Ireland to ensure that everyone in the UK can afford to live in a warm, dry home. To achieve this we aim to improve access to energy and debt advice, provide training, support energy efficiency policies, local projects and co-ordinate other related services which can help change lives. NEA also provides the secretariat for the All-Party Parliamentary Fuel Poverty & Energy Efficiency Group (FPEEG) to raise awareness of the problem of fuel poverty and the policies needed to eradicate it. For more information about FPEEG go to www.fpeeg.org.uk. For more information about NEA visit www.nea.org.uk.
  2. NEA’s full briefing document “Reducing energy costs for low income working households” can be found hereWithin this paper we highlighted to policy makers how to make energy bills more affordable for millions of low income working households this winter. In particular, NEA is calling for the £140 rebate under Warm Home Discount scheme to 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. NEA also highlight how an expansion of the scheme can be achieved without increasing energy prices for other consumers and adjusting existing tax-funded support. NEA has also called on Ofgem to 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.
  3. Ahead of the upcoming Comprehensive Spending Review (CSR), NEA is also calling for the introduction of a new ‘clean growth fuel poverty challenge fund’ providing necessary central investment to meet the statutory fuel poverty energy efficiency targets and related milestones.
  4. The fund would operate from late 2019 to 2025. It would aim to co-fund a range of sub-programmes to complement and compensate for current supplier-led assistance (the Energy Company Obligation), by supporting new locally-led ‘safety net’ schemes. The new ‘safety net’ schemes would prioritise hard to heat homes and help low-income households with long-term respiratory or circulatory health conditions receive priority assistance for energy efficiency measures.
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