AgilityEco welcomes strong recommendations from Committee on Fuel Poverty

The Committee on Fuel Poverty has released its annual report on the state of fuel poverty in England and the progress being made to achieve the statutory target of eliminating fuel poverty by 2030. The Committee is an independent advisory body to the Department for Energy Security and Net Zero (DESNZ). Its last report was in 2021 and since then there have been huge increases in energy prices and changes to government policy on energy efficiency.

AgilityEco welcomes the Committee’s report and we summarise the five key recommendations below:

1. Ensure a robust Fuel Poverty Strategy and effective measurement of fuel poverty that leaves no one behind: unsurprisingly, the Committee notes that the energy crisis of the last 18 months has hugely impacted the ability for households to pay their energy bills, and makes it more likely that the 2030 target of all fuel poor homes reaching EPC Band C will be missed. However, as government uses the rather technical Low Income, Low Energy Efficiency (LILEE) definition for fuel poverty in England, the rise in the official number of fuel poor households to 3.26 million is not as high as one might expect. The Committee questions whether a more inclusive definition of fuel poverty is required, which takes into account the ability to afford bills rather than requiring households to live in an energy inefficient poverty AND be below the poverty line.
2. Improve targeting of payments to support bills and better targeted energy efficiency programmes to meet the Government’s target: the Committee is keen that agencies share data and work together to improve targeting. They further propose improved communication of key messages to build confidence so that vulnerable households are more willing to let installers into their homes to make improvements to insulation and heating.
3. Improve affordability of bills through fairer pricing and better regulation to protect the fuel poor: over the last year the government has removed policy costs (aka ‘green levies’) from energy bills and paid for them from the Exchequer. It seems likely that these costs will return to bills shortly and the Committee wishes to avoid additional financial burden being placed on fuel poor households. We believe that the existing supplier-led approach to retrofit has been proven to work well, but we support the idea of fuel poor households receiving some form of discount on their energy bill. To this end the Committee also refers to the potential for ‘social tariffs’ for energy – something that is already in place for water bills. This would help to cap costs for the most vulnerable e.g. those that need to use electricity for vital medical equipment.
4. A shared mission to tackle fuel poverty adopted by Government, local government and the NHS: this is a longstanding ambition of many of us working in the field of fuel poverty – that it is treated as a health issue as much as it is a cost of living or climate issue. The recent ‘Home Advantage’ report by Citizens Advice highlights the potential savings to the NHS and reduction in winter deaths that retrofit will bring. So there’s nothing to argue with here, except that the current burden on the capacity and finances of councils and health authorities is so great that it will require some serious prioritisation to ensure that fuel poverty is given additional time and resources.
5. A fair transition to net zero that does not increase fuel poverty: the Committee sensibly highlights the need to ensure that fuel poor households do not suffer from the switch to new lower-carbon technologies. For example, if a gas boiler is the most affordable heat source for a fuel poor home they should not be prohibited from benefitting from it, especially when an ‘able to pay’ household is allowed to. The Committee asks for the government to create a long-term Energy Affordability Strategy and for the new Energy Efficiency Task Force to properly consider fuel poverty as part of its remit.

Behind many of these recommendations is the longstanding need for additional funding. This is no surprise and all commentators agree with the Committee here – the key question is where will it come from? AgilityEco and Gemserv published data in 2021 showing that £18bn of additional funding would be needed for fuel poor homes in order to meet the 2030 target. Since then the impact of the energy bill crisis and rampant inflation has increased the number of fuel poor households and the cost required to retrofit each one.

It is important that we think beyond the public purse and so the Committee presses the government to make clear its intentions towards minimum energy efficiency standards in privately rented properties. Current proposals to increase these standards have languished at the consultation stage for over 2 years now, giving no clarity to landlords nor support to tenants. Spend by landlords to improve their properties will reduce some of the burden on the taxpayer. 

We'd also welcome thoughts. If you wish to share them please email partnerships@agilityeco.co.uk.