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The Institute of Public Policy Research (IPPR) is calling for the current energy efficiency strategy to be replaced with a ‘help to heat’ policy to help alleviate the burden of green levies on low-income groups.
The IPPR has released a report saying green levies are falling disproportionately on low-income groups, and warned that unless the costs can be changed in way that protects vulnerable low-income households, support for decarbonisation will be lost from these sections of society.
It is calling for a help to heat strategy “to ensure energy efficiency initiatives are more effectively targeted at fuel-poor households” and for a green levy allowance to be offered to every consumer to reduce the burden on lower-income households and to “incentivise energy efficiency.”
The IPPR says this would save consumers billions in terms of their contribution and “recast levy-funding in a progressive manner.”
The IPPR said: “As the amount of levy-funded spending for this programme increases in the coming decades, this will have a damaging impact on these groups, and attract controversy, which could threaten existing commitments to decarbonisation.”
“Each consumer could be offered levy relief without jeopardising climate targets, and this could be delivered in such a way that it helps to incentivise energy efficiency.”
Trade body Energy UK’s chief executive Lawrence Slade defended the energy companies’ support to low-income households, saying: “Energy companies work hard to both make homes warm and energy efficient and support those facing difficulties paying their bills.”
“They spend hundreds of thousands of pounds each year to help customers in difficulty, through a number of programmes including the Warm Home Discount and trust funds.”
The IPPR is also calling for an end to the Conservative ban on future onshore wind development, to replace the capacity market with a strategic reserve, and to make offshore wind consent easier for developers to procure to lower costs, and to introduce public ownership for new nuclear capacity as other ways of reducing the cost burden on consumers.
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