More than 3m households in fuel poverty BEFORE the pandemic, official data shows: With the energy price cap set to rise, experts call for more help
- 13% of homes in England were living in fuel poverty as of 2019, data shows
- Many will be struggling financially now due to the impact of the pandemic
- Experts have said more needs to be done to help people with their energy bills
More than three million households – equivalent to 13 per cent – were living in fuel poverty even before the pandemic struck, new official data has revealed.
The average fuel poverty gap for England in 2019 – the reduction in fuel costs needed for a household to not be in fuel poverty – was estimated at £216, according to research from the Department for Business, Energy and Industrial Strategy.
This marked a decrease of 4 per cent – down from £225 – since 2018.
However, experts have warned the Government is not tackling the problem quickly enough as thousands more families face financial difficulties during the pandemic.
Millions of homes are still living in fuel poverty at the same time the energy price cap is rising
Households are considered to be living in fuel poverty if the home has a fuel poverty energy efficiency rating of band D or below or if, when they spend the required amount to heat their home, they are left with a residual income below the official poverty line.
The official poverty line is when households’ income is 60 per cent below the median household income after housing costs for that year.
BEIS said a household’s fuel poverty status depends on the interaction of three things including energy efficiency, incomes and energy prices.
It added the main reason for the reduction in fuel poor households from 2018 to 2019 was energy efficiency with 47.8 per cent of low income homes achieving an energy efficiency rating of band C or higher – up from 41.4 per cent in 2018 and just 14.6 per cent in 2010.
However, some 25.7 per cent of households were classed as having a low income with 57.4 per cent of homes classed as low energy efficiency.
Of those households with low incomes, 52.2 per cent were classed as fuel poor based on having an energy efficiency rating of band D or below.
This shows a direct link between poorer households and being in fuel poverty.
Help: Homes with lower incomes are more likely to be in fuel poverty, according to statistics
Households on default tariffs will also be seeing a significant hike in their bills too after the energy watchdog increased the price cap.
Ofgem announced the cap will rise to pre-pandemic levels, increasing by £96 to £1,138 for 11million default tariff customers.
Bills will also increase by £87 to £1,156 for 4million pre-payment meter customers.
The hike will come in on 1 April for six months with the changes blamed on a rise in wholesale energy prices.
Peter Earl, head of energy at Compare the Market, said: ‘With more than three million households in Britain living in fuel poverty, tackling this issue is not happening quickly enough to help families struggling with energy debt.
‘Paying for energy bills is a particular concern for families with children at home, whose energy usage tends to be higher anyway, but a winter spent in lockdown will significantly push up their energy costs.
‘Our research shows that if annual energy costs were to rise by only £85, it could tip more households into financial difficulty.
‘The fact that Ofgem has allowed energy suppliers to increase their default tariffs by an average £96 from April – a rise that is simply not affordable for some families – shows how much more work needs to be done to help those who are financially struggling.
‘There are steps people can take to help manage these rising costs such as shopping around for a cheaper tariff, or for those in debt on their energy bills, speak to your supplier and ask for help and advice or see if they offer a better tariff you can move to.’
Households who think they are paying too much for their energy bills are encouraged to use price comparison sites to see if they could save money by switching tariff or to a fixed deal.
Although, this can be harder for those on pre-payment meters – a situation which many more poor households are likely to be in.
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