Fuel Poverty Awareness - Millions Suffering in Cold Homes
Just over two years ago, we entered an energy crisis that resulted in months of mounting financial pressure, with the typical bill soaring by an additional £800. On November 22nd 2023, the Chancellor’s Autumn Statement announced that next January, energy bills are set to be £1,928 for households on prepayment meters and £2,058 for households who pay by direct debit. This means that the typical household bill will increase by an average of £94 or 5%, hitting just after Christmas and when temperatures are due to drop.
Estimated bills are based on Ofgem’s Energy Price Cap, which is calculated from the maximum cost that suppliers can charge for each unit of energy, as well as the ‘typical usage’ of each household.
This cost represents what Ofgem deem as the average annual energy bill. However, how much you pay depends on how much energy you use.
Broken down, the price cap consists of:
Price per unit of gas: 7p per kilowatt hour (kWh)
Price per unit of electricity: 29p per kWh
Standing charges (the cost covering the supply of energy) have not changed – 53p a day for electricity, 30p a day for gas
Evidently, the increase in the price cap does not always mirror what your household will pay. The BBC’s energy price calculator allows you to input data about your home and energy use and calculates a more accurate reading.
In May 2023, Ofgem lowered the Typical Domestic Consumption Values (TDCVs) to reflect the falling trend in the consumption of electricity and gas. We could hope that this would be due to improved energy efficiency. However, the reality is that households have been enduring colder living conditions because the insurmountable cost of energy is such an issue. The decline in the typical usage illustrates the challenges that many households are facing, it also paints a picture of this as the new normal, with households cutting corners and using less gas and electricity because it has become too expensive to justify.
If treating gas and electricity as a luxury is the new normal, then what about vulnerable households who may struggle to afford the ‘typical’ bill?
The expectation to pay more to heat your home less sets a dangerous precedent for vulnerable individuals who cannot acclimatise to damp and cold homes. Heating is not a luxury, it is an essential, especially for those who are elderly, may live with health conditions, and are reliant on medical equipment. In fact, these households require warmth to stay healthy and safe, spend more time at home and often use more electricity to power medical equipment.
More than just hope has been building for a reduction in the price cap this winter, it would have been a lifeline for those struggling to pay.
Last winter, prices soared even higher, capped by the Energy Price Guarantee at a staggering £2,500. Additionally, each household received at least £400 of support between October 2022 and March 2023 as part of a ‘Cost of Living’ package. The discount was automatically processed through energy suppliers and helped make a small dent in the increased costs. This year there is no equivalent scheme, Chancellor Jeremy Hunt announced that pension increases, tax reductions and changes to benefits will help pay towards bills. However, for those buckling under the previous year’s financial pressures, this is not enough and disregards a need to provide direct support to households.
“By January 2023, over half of households in the UK (15 million) will be in fuel poverty – spending over 10 per cent of net income on fuel.” - Child Poverty Action Group
NEP are supporting Fuel Poverty Awareness Day (organised by National Energy Action) on Thursday 30 November 2023 because the ongoing energy crisis has been crippling millions of homes across the UK for two years now. It is our mission to tackle fuel poverty every day, as this is an ongoing problem in need of long term actions, for everybody to have a warm, safe and comfortable home.
“The reality for many of our clients is that they cannot afford to keep their homes warm. The price hike will have detrimental impacts on the millions of people struggling to pay their bills. At Nottingham Energy Partnership we have been working to combat fuel poverty for over 20 years. We offer a range of services intended to maximise disposable income as much as possible, as well as reducing the cost of energy. This includes providing essential winter items as fast-acting support for those facing difficulties with heating and eating. We understand the difficulties people are facing and encourage anyone who needs help or advice to contact us.”
People are being forced to seek warm spaces because their homes are too cold, energy debt has spiked, and mental and physical health conditions are worsening. As we approach the coldest points of winter, the news is bleak, but it is vital that people know about the support available.
To find out more about the support available, visit our Cost of Living support page here. Alternatively, contact us here or call 0115 985 9057.