Extent of fuel poverty causing ‘unprecedented capacity challenges’

Organisations supporting vulnerable customers through the energy crisis are facing “unprecedented capacity challenges” due to the volume and complexity of cases, a new report has found.

In its latest Fuel Poverty Monitor National Energy Action (NEA) estimates there are 6.7 million UK households now living in fuel poverty, up from 4 million two years ago.

Based on the revisions to the Energy Price Guarantee from April, which indicate an average household bill of £3,000 a year, the charity expects this figure to increase to 8.4 million.

The report considers the causes and impacts of soaring energy bills and investigates the responses to the crisis across the four nations and the roles that different actors are playing to help support fuel poor households.

Among the report’s findings was the impact of the demand on frontline local and national organisations and it calls for bodies such as energy suppliers, networks and landlords to act to alleviate the pressures facing consumers.

It said: “Regulators, local government, energy companies, landlords and health practitioners cannot affect the price of energy or the direct financial support afforded to households.

“However, they do each have interactions with people that are vulnerable to the impacts of fuel poverty, and should look to give advice, signpost, and use the resources at their disposal to help those that would otherwise be left behind.”

While acknowledging the government’s £40 billion support for households, NEA criticises the fact that vital resources have been poorly targeted, and many households are falling through the gaps of assistance schemes.

The report also notes the impact the crisis is having on households falling into “multiple intersecting categories of vulnerability” which it says are being disproportionately affected.

“While all low-income households are feeling a significant strain during the crisis, impacts go beyond those receiving means-tested benefits, and are felt most acutely by those households that have intersecting categories of vulnerability.

“These households are not caught by traditional identification measures and new ways of finding vulnerable households are required.”

NEA makes recommendations across five key areas including:

• Better identifying of the households that require financial support
• Providing specific support to prepay households so that self-disconnections can be minimised
• Ensuring that those most affected by the crisis are the priority for future support
• Providing support for fuel poor households from organisations beyond the national governments
• Accelerating a fair and affordable transition to net zero to abate this emergency and avoid future crises

Speaking to Utility Week about NEA’s findings Matthew Copeland, the charity’s head of policy and public affairs, said the scale of the impact of the crisis was surprising.

He said: “We were, for once, completely shocked by the depth of the impact that the crisis has had on people. We look at the impact of fuel poverty on households all the time and the energy crisis just makes things a million times worse.

“So the proportion of households that we know are self-disconnecting, the depth of rationing there is out there in terms of the lengths that people are going to in order to reduce their energy bill. For example, people rationing their use of medical devices, which is something that we didn’t expect to see at the scale that we found in the report.”

Copeland said that as well as physical health, the crisis was having severe impacts on people’s mental health which was “particularly shocking”.

He added: “So really it’s the scale of it, the impact that it has on people that, to be honest, it did surprise us.”

A government spokesperson said in response: “We know this is a difficult time for families across the country.

“That is why we have acted quickly to deliver the Energy Price Guarantee which is saving a typical household £900 this winter and our Energy Bills Support Scheme is providing a further £400 off energy bills, in addition to the most vulnerable households receiving up to £1,200.

“We are working with consumer groups and industry to assess the best long-term approach to helping vulnerable households from April next year.”

An Ofgem spokesperson said: “Our top priority is to protect the interests of consumers. National Energy Action recently informed us they would be releasing this report. We will consider the report’s recommendations and respond to NEA in due course.”