One-third households in Britain may be unable to afford heating

As fuel-poor households confront a “countdown to cold,” energy supplier Utilita has issued a list of demands to the government.

A new study found that one in three households in England and Wales are on a 120-day countdown to cold, knowing they cannot afford the fuel they need this winter. According to a new report on fuel poverty, unless the government intervenes with direct energy support for affected households, nine million households are at risk of going without adequate heat during the upcoming winter.

In groundbreaking research, experts analysed the energy habits of 51,205 financially vulnerable households over the past two winters to determine the actual size of the fuel poverty gap.

Based on an anticipated price cap of £1,850 on the 1st of October, it was determined that the lowest-income households would require an additional £593 to afford the heat they need to remain warm and healthy this winter.

In a worst-case scenario, the price would rise to £797 if the price limit was raised to £2,500.

Despite reports of 6.6 million households being in fuel poverty, the new report reveals that approximately nine million households will struggle to power and heat their homes this winter, based on the government’s “10 per cent of income spent on heat” fuel poverty metric and ONS household income data.

Smart Pay-As-You-Go energy provider Utilita, which created the report with fuel poverty experts from the University of Oxford, urges the government to disclose direct financial assistance for fuel-poor households before the weather changes.

Bill Bullen, chief executive officer and proprietor of the energy provider, stated, “The government must not permit one in three households to worry about the upcoming winter with no assurance of financial assistance.”

“Low-income households are less resilient than ever, and they are already self-rationing energy and food out of dread for the future.”

“About six out of ten fuel-poor households pay by direct debit, and half of these will not be smart-enabled, meaning they will self-ration and go without – all without the knowledge of those who can assist them.” “However, with Smart PAYG, we can observe our customers’ behaviours and intervene as needed.”

According to the data, last winter’s £400 Energy Bill Support reimbursements for Smart PAYG households cut self-disconnections in half.

And for every £1 spent on reducing fuel poverty, the NHS saves 42p; therefore, for every £593 in direct energy credits provided to alleviate fuel poverty, the NHS would save £250 annually.

The findings also disclosed that the 24th of October is the official “heating switch-on day” for most households in England and Wales, whereas this can occur as early as mid-August in Scotland, where 12.5 degrees Celsius is the outside temperature threshold for home heating.

Bill Bullen added, “Because 92% of Utilita’s households are smart-enabled, we can closely watch vulnerable people and assist them when they are in need.”

“Since the autumn of 2021, we have assisted our customers in affording more than £100 million worth of energy when they struggled to make ends meet.”

UTILITA’S SEVEN DEMANDS TO ALLEVIATE FUEL POVERTY THIS WINTER:

• Immediate prohibition on the installation of legacy metres and a mandate for suppliers to prioritise smart metre installations for low-income households. This prevents households with legacy metres from enduring in silence.
• Suppliers must inform eligible customers about the ECO4 scheme as a licence condition. Suppliers could target fuel-poor households in thermally inefficient homes without worrying about marketing permission.
• In a new, specialised marketing campaign, redouble your efforts to inform households about the assistance and support available through smart meters. This would prevent families from suffering in seclusion.
• Rework ECO4’s “all measures” approach so that low-income households can benefit. This allows suppliers to confidently install ECO4 measures and increase the thermal efficiency of more fuel-poor households instead of only those suitable for heat pumps.
• Accept Great British Insulation Scheme policies. This would enable suppliers to begin insulating their customers’ homes confidently.
• Announce between £593 and £797 in direct winter energy assistance for households with the lowest incomes. This would prevent dangerous self-rationing and self-disconnection.
• Consider the weather and energy performance certificate data when revising energy support policies. This would provide adequate winter support for households.