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Understanding Fuel Poverty

Introduction:

Fuel poverty is defined as being in a position where you have to spend more than 10% of your income to keep your home warm and comfortable. Unfortunately, the recession and the ever-increasing cost of energy have impacted on many families in the UK, substantially increasing the number who will struggle to pay fuel bills in the future.

It is estimated that over four million households in England are classified as being in fuel poverty. The Fuel Poverty Advisory Group, which is funded by the Department of Energy, estimates that nine million people could meet that criteria by 2016, and that 300,000 additional homes will be added to that figure this winter alone.

What are the main causes?

It is acknowledged that fuel poverty and poverty are closely linked, but there is a clear distinction. Fuel poverty describes the particular hardship faced by many people on low incomes who live in ‘hard to heat’ housing, or run expensive, inefficient appliances e.g. fridges, cookers, washing machines, lighting, etc.

Energy efficiency

Unfortunately, people on a low income are more likely to pay for a boiler to be repaired when it breaks down, instead of being replaced with an energy efficient appliance. People on low incomes are also unlikely to have their heating appliances serviced on an annual basis. This could lead to the boiler working less efficiently, which will cost more to run.

Poor Insulation

If the home isn’t properly insulated heat will quickly dissipate. A typical home loses around 20% of its heat through draughty doors and windows. Double-glazing will typically reduce heat loss by 50% compared to single-glazing.

The UK has the oldest housing stock in the developed world with 8.5 million properties over 60 years old. The recommended depth for loft insulation has increased is 270mm (around 11 inches), but many properties only have half that amount.

Controls

Having the right heating controls (and using them properly) can make a substantial saving on fuel bills. Whatever the age of the boiler, controls can be set for heating and hot water to come on and off at the specified temperature only when they are needed. If the room thermostat is turned down by one degree a saving of around £55 could be made per year.

Under occupancy

Because of many circumstances, accommodation can become expensive to heat because of under occupancy. For instance, one person living in a two or three-bedroom house may struggle to keep the property adequately warm. Over 50% of fuel poor households consist of a single adult.

Rented accommodation

People living in rented accommodation are at a higher risk of fuel poverty. Landlords may not be interested in insulating their property or providing energy efficient heating. In addition to that, tenants may be forced to use pre-payment meters, which increases the cost.

Who does it mainly affect?

People earning a low wage, or are on benefits have limited income and many have to choose between heating the home and eating properly in the winter. This can be the case for households with a number of children, elderly people or those suffering long-term illness or disability.

Dangers to health:

Hypothermia is a life-threatening condition and develops when the body’s core temperature drops below 35°C (95°F). Normal body temperature is around 37°C (98.6°F). People suffering from cardiovascular illnesses, are more at risk of being seriously ill if they suffer from hypothermia.

Mould/mildew is common to properties that are poorly ventilated and don’t have adequate warmth. It can lead to asthma, bronchitis, common allergic reaction symptoms, nervous system disorders and respiratory illnesses.

Stress/depression can go hand in hand with money worries. Over the last five years energy prices have soared 63%, causing a great deal of distress to many. It is expected that fuel prices will continue to rise.

Tackling fuel poverty:

Winter Fuel Payment

At present, anyone collecting a state pension or on certain benefits can claim a Winter Fuel Payment. It is an annual tax-free payment made to eligible people to help towards their winter heating costs. It is a lump sum and in most cases is paid automatically, but some people will need to claim.

More information from: www.gov.uk

Cold weather payment

In addition to the above, if you are eligible, payments will be made when your local temperature is either recorded as, or forecast to be, an average of zero degrees Celsius or below over seven consecutive days.

More information from: www.gov.uk

Nest Scheme

Nest is the Welsh Government’s fuel poverty scheme. It aims to help reduce the number of households in fuel poverty and make Welsh homes warmer and more fuel-efficient places to live.

More information from: www.nestwales.org.uk

Warm Home Discount

The Warm Home Discount scheme is a four-year scheme that runs from April 2011 to March 2015 to help low-income and vulnerable households with energy costs.

More information from: www.decc.gov.uk

Green Deal

Green Deal has taken over from the Warm Front Scheme, which finished on 19th January 2013. The Green Deal is the UK Government's initiative to increase energy efficiency for households, by offering energy efficient products at no up-front cost. The scheme is essentially split into two parts - Green Deal Grants and Green Deal Finance. More information from: www.gov.uk

Unable to pay?

Contact the energy supplier immediately if there is a problem with paying bills. They will be able to give advice on what to do on managing the use of energy in the home and should offer a tailored payment plan. Always check to find if you are on the cheapest tariff.

A person already on benefits who can’t pay their energy bills could be put on the Fuel Direct scheme. Payments are taken each week directly from benefits, and paid straight to the supplier. It’s best to avoid using prepayment meters as energy is charged at a premium rate.