Fuel Poverty is when someone needs to spend over 10% of their income after tax to keep warm. The point at which they have to start deciding whether to eat or keep warm. Clearly the Winter Fuel and Cold Weather payments help and will remain.
In the last five years the proportion of homes in Fuel Poverty rose from 2.8million households in 2007 to 4.6million households in 2009. This is largely from energy price rises but also where home insulation has taken place its not sufficiently reached the most vulnerable.
A few weeks ago the Green Deal was announced which energy companies will support via Energy Company Obligations aimed at poorer customers. This will initially target poorer homes and undertake the hard as well as easy insulation e.g. solid wall insulation. This will take time to implement on all UK homes. While the Green Deal takes effect, and from April 2011, by law energy companies will have to give rebates to more of their most vulnerable customers – the Warm Home Discount. This discount is expected to help 2million households a year to the tune of £1.1billion a year.
That clearly leaves a gap so the speed of the Green Deal implementation will be crucial to end Fuel Poverty by 2016.
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I did hear that they are going to introduce a new scheme which means energy companies have to give discounts to the vulnerable and additional money will be given to help with heating costs. But with 4.6 million people affected by fuel poverty in 2009 it is a serious problem which needs to be abolished.