Fuel poverty - making up for missed opportunities

Jonathan StearnDirector

Sustainability and DisadvantageConsumer Focus

Consumer Focus: who we are

• Consumer champion - persuade businesses and public services to put consumers at the heart of what they do– England, Wales, Scotland, Northern Ireland (post only)

• 2007 Consumers Estate Agents and Redress Act– energywatch, Postwatch and National Consumer

Council– merged in Consumer Focus (CF) in Sept 2008

• 2012: consumer landscape review– 2013: CF Regulated Industries Unit (RIU) Work plan - Consumer vulnerability and fuel poverty– 2014: RIU (working title) transferred to Citizens Advice

Groups of vulnerable consumers?

Consumer Focus must have regard to theinterests of consumers that are one or more of the following — • (a)disabled or chronically sick

individuals; • (b)individuals of pensionable age; • (c)individuals with low incomes; • (d)individuals residing in rural areas.

Section 6 (4)

Consumer vulnerability rather than vulnerable consumers

AS• Vulnerability can be long-term in effect or it can be

a dynamic state – like unemployment, or bereavement

IN REALITY• Society is not simply divided into `vulnerable

groups’ and the rest• Vulnerability can be caused by external factors

such as an organisations’ actions or the nature of certain markets

Consumer vulnerability and the market – what’s the link?

Individual circumstances

The market Consumer vulnerability

Consumer Focus has defined consumers in vulnerable situations as: ‘People who cannot choose or access essential products and

services which are suitable for their needs, or cannot do so without disproportionate effort/cost/time.’ December 2012

Tackling consumer vulnerability – an action plan for empowerment

Consumer vulnerability and fuel poverty –the market’s the link

Individual’s

circumstance

The Market

High energy prices

Low income

Poor energy efficiency

HomeEnergy

Efficiency

Fuel poverty

Fuel poverty prices + energy efficiency = energy suppliers + regulator

The marketHigh energy prices

vsEnergy efficiency

programmes+

Social tariffs/Warm Home Discount

=Energy suppliers

Fuel poverty

Solutions = energy suppliers/the market has major influence

Fuel poverty – is the market alone able to provide the solution in England?

CollectEnergy bills

The Market(Energy suppliers

)

DeliverEnergy

EfficiencyWarm Home

Discount

Fuel poverty

?

Fuel poverty: who is responsible?

• The UK government bears primary responsibility to end fuel poverty

• And energy suppliers? They have rapidly acquired responsibility to collect the money from consumers and deliver the policies to tackle fuel poverty

• But neither are really doing that well. With 6 million UK households in fuel poverty. The UK government is set to fail to meet the target of ending fuel poverty by 2016

• At last count energy companies had, on average, only delivered 46 per cent of the Carbon Emissions Reduction Target (CERT) for the super priority group.

Fuel poverty: local authorities England

• Local authorities can take a key role in all three drivers of fuel poverty – – energy prices - collective switching, oil clubs– Income – living wages and benefit take up – energy efficiency

• Research for Consumer Focus by Joanne Wade found 46 % of responding authorities gave fuel poverty a high priority. But only 20 had targets.

• We found only 24 authorities in England took the lead in energy company programmes (CERT and Community Energy Saving Programme).

Fuel poverty: public health – driving action?

• Despite what Wikipedia says public health is not just about hand washing, breast feeding and the distribution of condoms. It means recognising the link between cold homes and poor health

• Investing in warm and energy efficient homes could provide cost benefits to the NHS. The Chief Medical Officer estimated that the NHS spends £859m each year treating cold related illnesses due to poorly insulated homes

Fuel poverty: glass half full

• The government turned to local authorities to help with Warm Front in 2012/13. £50 million had been left in the Treasury coffers in 2012

• Despite the cuts in the energy efficiency programme the Energy Company Obligation in 2013 will have £350m available plus £190m in the Energy Carbon Savings Community Obligation (CSCo) – it needs local authorities to be involved.

Fuel poverty: civil society

• The voluntary and community sector and the rest of civil society can play a key role.

• Consumer Focus, Age Uk, Citizens Advice and NCB ran two campaigns that doubled Warm Front applications.

• An example:– A grant from Scottish Power Energy People Trust,

allowed Amaze to extend its work to include energy audits. It focused on helping parent/carers of children with special needs to identify how to make their homes more affordable to run and to help pull families out of fuel poverty.

Fuel poverty: Wales

• There are initiatives [Nest, Arbed etc ] that highlight a Welsh approach that includes the involvement of the Welsh Government, local authorities, civil society with the energy suppliers + a recognition of the health impact of cold /damp homes

• But we still need to get more funding to initiate a step change in the way we tackle fuel poverty.

• Where could extra funds come from?

Delivering energy efficiency:Public spend

• Scotland: integrate ECO & public funding

• Wales & NI: also committed to public funding

• But sadly still not enough funding in the UK to tackle the scale of fuel poverty

Where could extra funds come from?- Energy Bill Revolution

Recycle carbon tax:− Over next 15 years UK

government will raise an average of £4 billion every year from Carbon Taxes

− energy efficiency programme focused on fuel poor

− ‘fuel poverty proof’ homes: ‘home built today’ standard

− almost all of fuel poor removed from fuel poverty

www.energybillrevolution.org

Energy bill revolution supporters