Support package is welcome but lacks efficiency measures

The £15 billion support package unveiled by the chancellor has been broadly welcomed by the energy industry, but concerns have been raised about the lack of energy efficiency measures included.

In a statement to the House of Commons on Thursday (26 May), chancellor Rishi Sunak outlined the assistance the government will provide to help tackle soaring energy bills, including targeted support for low-income households.

The announcement came following a projection from Ofgem earlier this week that the price cap will rise to around £2,800 in October.

Speaking to Utility Week, Energy UK deputy director Dhara Vyas said the trade body is “really pleased” the government has responded to calls from the sector and from consumer groups, but said there are some areas where ministers could have gone further.

She said: “It’s important to give the Treasury and the Chancellor credit for this, for listening and putting in place the support. That’s not to say it will be easy this winter but I think increasing the support – and targeting it – should help millions of households. It’s great that they are taking action now instead of waiting for the winter price cap.

“There’s a couple of areas where I think they could have gone further. I still don’t think that there’s enough support in place for non-domestic customers, the business customers who are really struggling right now because of high prices.

“Also, there’s a lack of consistency in the absence of proper, comprehensive support to improve energy efficiency for households. The cheapest energy is the energy you don’t use and improving energy efficiency is so important because it will help to reduce bills permanently for the long term.”

Simon Virley, vice chair and head of energy and natural resources at KPMG, also pointed to the lack of action on energy efficiency, the promotion of which is a key plank of Utility Week‘s Energy Reset campaign.

He said: “Alongside providing immediate help to households, the government should also be making a major push on energy efficiency, just as other European countries are.

“That remains the most cost-effective way to get bills down permanently, reduce our dependence on imported gas and lower our carbon emissions.”

Matthew Copeland, head of policy and public affairs at the charity National Energy Action, said it was a “very promising” package and one that will help millions of people through the winter.

He said the measures will provide “deep targeted support” for those most impacted by price rises and offset the whole of the expected October cap increase for the poorest households.

“Overall this is a really good package of measures, well targeted and deep,” he said.

However, he added: “That’s not the end of the story unfortunately. There are some people who won’t be helped in the way that they need to by this. Many fuel poor households are not in receipt of means tested benefits and won’t be able to access the winter fuel payment and are not disabled. So there are some households who won’t see the full benefit from this.

“Also there are lots of households who are already really struggling and whilst this will mitigate the October increases, prices as they are will be difficult for them. But at this point this is a very promising package and one that will help millions of people through the winter.”