CAN Training Day4th July 2014

Fuel Poverty Policy Update

Peter SumbyDirector of Development

NATIONAL ENERGY ACTION

Fuel Poverty StatisticsUsing the LIHC definition• 2.28 million fuel poor households in England: 5%

decrease from 2011, • Depth of fuel poverty also showing a slight decrease• DECC projections for 2014 show an upward trend • The poorest continue to live in the worst homes – 35% of households living in the least efficient properties in

fuel poverty – only 2% in the most efficient properties.

DECC’s 2014 annual statistics on fuel poverty (2012 data) can be found at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/319280/Fuel_Poverty_Report_Final.pdf

Fuel poverty sub-regional statistics can be found at https://www.gov.uk/government/collections/fuel-poverty-sub-regional-statistics

Fuel Poverty Statistics

Domestic Renewable Heat Incentive (RHI) Goes Live…. ….. but leaves fuel poor out in the cold

• Launched 9th April 2014• Pays participants of the scheme that generate and use

renewable energy to heat their buildings• Open to homeowners, private landlords, social landlords and

self-builders

NEA campaigning to ring-fence part of the domestic RHI budget to provide upfront capital support and assistance with maintenance costs for low income households

For more info on the domestic RHI visit: https://www.gov.uk/government/policies/increasing-the-use-of-low-carbon-technologies/supporting-pages/renewable-heat-incentive-rhi

NEA’s priority areas for Govt. to address;

• Carbon Emission Reduction Obligation (CERO) target should not be reduced by 33%

• Introduction of ‘mandated’ referrals with guaranteed assistance for specified householders

• Min. energy efficiency standards - a target of EPC band B by 2030 for all low income homes

Proposed Changes to ECO

ECO – Energy Company Obligation• CSCO - Carbon Saving Communities Obligation • CERO - Carbon Emissions Reduction Obligation• HHCRO - Home Heating Cost Reduction Obligation

The Monitor is a report, produced by NEA, which summarises and assesses the activity being undertaken at UK and national level to address fuel poverty.

UK Fuel Poverty Monitor 2013-2014

The report focuses on the different approaches the Westminster and the devolved governments are taking to tackle the root cause of this issue: an energy inefficient housing stock.http://www.nea.org.uk/policy-and-research/publications/2014/monitor-2014

• UK-wide and national-level findings on the scale and causes of fuel poverty

• The report finds that there is a lack of coordination across the nations

• Scotland and Wales are leading other countries on providing government-funded, area-based and whole-house approaches to energy efficiency

• England continues to provide no recurrent funding and lacks a binding duty for local authorities to address environmental and social objectives through housing

• Notes the GB wide impact of the proposed changes to ECO

FindingsUK Fuel Poverty Monitor 2013-2014

1. UK Government should massively expand resources for energy efficiency, but especially for low-income households living in the worst properties and most deprived areas

2. UK Government must recognise the impact that energy policy set in Westminster has on the whole of GB and must quantify the impacts on fuel poverty across the respective nations before making significant policy decisions

3. HM Treasury must not directly benefit from any schemes that effectively increase the cost of energy

4. There is a need for greater and more transparent coordination across the Westminster and devolved governments on all consumer energy issues

RecommendationsUK Fuel Poverty Monitor 2013-2014

NICE ConsultationOn 13th June 2014 the National Institute for Health and Care Excellence (NICE) issued a consultation on their draft guidance on how healthcare professionals must take action on cold homes

Consultation responses by 25 July 2014. For further info visit: http://www.nice.org.uk/nicemedia/live/13899/68006/68006.pdf

NICE recommendations include:• Providing a one-stop local health and housing referral service for people

living in cold homes which offers access to grants for housing insulation and heating.

• Identifying people at risk of ill health from living in a cold home. • Ensuring vulnerable hospital patients are not discharged to a cold home by

turning on the heating before they get home or providing advice on how to use the heating system.

• Training heating engineers, meter installers and those providing building insulation to help vulnerable people at home with sensitivity.

• NEA considers Distribution Network Operators (DNOs) can (and must) play a key role in incentivising permanent electricity demand reductions on their networks

• Will not only help to avoid unnecessary load related network reinforcement but will also have a direct positive social outcome

• NEA recommends DNO support for large scale heating system replacements, lighting improvements and insulation programmes

• NEA underlines that this activity must be central to the new distribution price control (ED1) starting in 2015.

Electricity Demand Reductions

Scale of Fuel Debt

Q2 2013 (April – June) Ofgem Figures

1.6 million domestic electricity accounts (5.8 per cent) and 1.5 million domestic gas accounts (6.5 per cent) were in debt.

Average levels of electricity and gas debt outstanding were £316 and £341 respectively, up four per cent and nine per cent from the end of 2012.

Scale of Fuel DebtOfgem - Domestic suppliers' Social Obligations Report

Total in Debt Q4 - 2012 Q1 - 2013 Q2 - 2013

Electricity 1,358,764 1,477,765 1,555,968

Gas 1,194,853 1,292,776 1,448,577

April - June 2013 Total number of PPM’s installed

To recover debt Requested by customer

Electricity 72,209 57,978 14,231

Gas 75,229 60,839 14,390

Ofgem puts big six energy suppliers under Competition and Markets Authority spotlight• The big six energy suppliers face a probe from

Competition and Markets Authority after referral from the energy watchdog

• The big six suppliers will be under the spotlight for the next 18 months as the CMA looks at whether profiteering has occurred and if they should be broken up.

Ofgem leads radical shake up of energy switching process

• Ofgem approves suppliers’ proposals to cut switching time to three days after statutory two week cooling off period, by the end of 2014

• Ofgem is leading radical reforms to put next day switching in place by end 2018 at latest

• Proposals will also improve the reliability of the switching process

• Faster and more reliable switching set to improve consumer confidence to shop around for a better energy deal

Please contact:peter.sumby@nea.org.uk

www.nea.org.uk