News - Page 3 of 27 - End Fuel Poverty Coalition

Energy debt soars 57% in 12 months

Households’ combined energy debt has soared again in figures released by Ofgem.

The total energy debt (which is 91 days or more overdue) had risen to £3.3bn by end Q1 2024.

The figure is up from £3.1bn at end Q4 2023 and up 57% (from £2.2bn) at the same point in 2023.

The End Fuel Poverty Coalition previously revealed that one in five (18%) of households in energy debt are turning to illegal money lenders to pay for their bills and everyday essentials.

For many in energy debt, energy firms will suggest moving to a prepayment meter (PPM), which enables customers to pay off their debt every time they top up their meter.

But Warm This Winter research indicates that the suffering of households in debt on prepayment meters is even worse than for those on direct debit. The numbers turning to illegal money lending are also significantly higher for PPM customers (36% PPM / 13% DD).

A spokesperson for the End Fuel Poverty Coalition commented:

“Millions of households have fallen into energy debt due to the record high prices.

“The next Government must now make tackling energy debt a priority. It should do this by introducing a universal, consistent, nationwide, debt matching programme. This could be funded in part by the £1.3bn customers are paying through bills for energy debt costs this year.

“The average household has had to find £2,500 in the last few years just to keep their energy usage where it was. When combined with the ongoing cost of living crisis, this is a figure well beyond people’s means and it is no wonder that people are now getting deeper into debt.

“While the energy industry has pocketed the profits, struggling families have been abandoned with many turning to illegal money lenders.”

Experts have also recommended a ban on energy firms from selling on debt to debt collectors, better regulation of energy debt with energy debt and debt collection agencies used by energy firms to be subject to Financial Conduct Authority rules and more training for energy firms’ staff in recognising illegal money lending.

Steve Vaid, chief executive of the Money Advice Trust, the charity that runs National Debtline said:

“The fall in the Price Cap will alleviate some of the pressure many households are under, but many more will continue to struggle as energy bills remain high.

“As millions of people worry about keeping up with their energy payments, arrears levels have continued to increase and many have been left with unaffordable debts as a result.

“What we need to see from the next Government is urgent action through a Help to Repay scheme to help people trapped in energy debt access a safe route out.

“Anyone struggling with their energy bills, or worried about their finances, should contact National Debtline as soon as possible – our advisers are here to help.”

£1,071.98: The energy price cap households could have had

Energy bills are set to fall by 7% on 1 July as the new Ofgem price cap comes into force, but campaigners have claimed the figure could be £500 lower if measures had been taken to mend Britain’s broken energy system.

Insulating homes, reducing standing charges and removing VAT from energy bills would have significantly reduced household’s costs, according to analysis by the End Fuel Poverty Coalition. [1]

With the Ofgem price cap expected to rise again by around 10% in October 2024, the next Government has been urged to implement proposals to bring down the cost of energy from day one.

Chief among the asks for new ministers are to launch a comprehensive plan to bring down standing charges, provide more support for vulnerable households this winter and create more energy efficient homes (by strengthening minimum energy efficiency standards in the private rental sector and laying the statutory instruments needed for the Future Homes Standard and the Clean Heat Market Mechanism).

A majority (57%) of the public also back a social tariff, designed to offer cheaper energy to vulnerable households.

A social tariff is a discounted energy bill for people in greatest need, such as those people that have low incomes and are elderly, have young children or rely on energy for medical needs. It could be paid for by the £427bn in profits that have been generated by the whole energy industry since the start of the energy bills crisis. [2]

Campaigners have also called for the next Government to introduce a universal, consistent, nationwide, energy debt matching programme funded by the £1.3bn customers are paying through bills for energy debt costs this year.

A spokesperson for the End Fuel Poverty Coalition commented:

“Throughout the energy bills crisis we have seen sluggish progress on insulating and ventilating our homes, bringing down standing charges, moving to cheaper energy sources and bringing in comprehensive support for vulnerable households with their energy bills.

“Had we seen more concerted action on all these fronts, then the Ofgem price cap coming into force on 1 July would be £1,071.98 – £496.62 lower than what the average household is going to be paying.

“Given energy bills will stay high for the foreseeable future we now need the next Government to act quickly after the election to end energy debt, protect households from the volatile global energy market, bring down bills for good, improve housing standards and make Britain a clean energy nation.”

Warm This Winter spokesperson Fiona Waters said:

“Energy bills will go up again in October and years of staggering prices have taken their toll. Customers are already £2,500 out of pocket because of Britain’s broken energy system and now we know they are going to continue to be penalised if we don’t see the reforms we need.

“As well as the plans to insulate homes, bring down standing charges and provide support through a social tariff, we also need to see new renewables schemes that, according to the House of Commons Library briefings, are able to generate electricity more cheaply than fossil fuels.”

Juliet Phillips, UK energy lead at E3G added:

“It’s been repeatedly shown that investing in long-term, clean solutions to fix our broken energy system will bring bills down permanently.

“The British public backs common-sense proposals to upgrade our homes and ensure that everyone can afford to heat their home. We urge all political leaders to make this a national priority, and take action before energy bills are set to soar again this winter.

“Without action, households are set for another £200 price rise in the Autumn, as the UK remains dependent on expensive foreign gas.”

ENDS

[1] The cost was calculated by taking the following steps:

Take published Ofgem unit rates and standing charges for the average household based on current typical domestic consumption values (average use) of £1,568
Reduce gas consumption levels to reflect impact of improving insulation in home, in line with the ECIU model (brings average bill to £1,348.80)
Reduce unit costs to reflect the lowest available unit cost available on the market (Future Energy Associates database, brings the average bill to £1,292.28)
Reduce standing charges and adjust unit costs in line with Future Energy Associates discussion paper, published on 20 June 2024 (brings bill down to £1,124.95)
Remove VAT at 5% (£1,071.98)

Figures and methodology peer reviewed by Chris Galpin at E3G.

[2] Data as at 6 June 2024. Researchers examined the declared profits of the 20 firms the End Fuel Poverty Coalition is most asked to comment on. This sample of the industry ranges from energy producers (such as Equinor and Shell) through to the firms that control our energy grid (such as National Grid, UK Power Networks and Cadent) as well as suppliers (such as British Gas). It does not include supply chains nor market trading firms.

Energy giants have pocketed just under £427 billion in profits since the energy crisis started according to a new analysis of company reports. Over £34 billion of these profits (the equivalent of over £1,153 per household) are thought to be made by the firms and business units responsible for electricity and gas transmission and distribution. These are the “network costs” consumers pay for maintaining the pipes and wires of the energy system and are usually paid for through standing charges on energy bills. Standing charges have risen 147% in recent years for electricity and 15% for gas.

The last update was on 1 April 2024 which showed industry profits of £420bn with £30bn from networks and transmission.

The data was compiled by freelance business journalist David Craik. David’s experience has included writing business and city news and features for national newspapers and magazines such as The Daily Mirror, Sunday Times, Wall Street Journal, Scotsman and Daily Express. Much of his content focuses on company financial results and reports in the energy sector and on personal finance issues including wealth management, property, investing and managing household budgets and bills. If any firm wishes to correct the records, please email info@endfuelpoverty.org.uk.

Ofgem called on to keep the ban on energy acquisition tariffs

A coalition of consumer organisations and energy firms is urging Ofgem not to lift the ban on acquisition-only energy tariffs, which could lead to existing customers being excluded from the best deals and risk opening the door to loyalty penalties.

Ofgem has said it is minded to remove the ban on acquisition-only tariffs – which would be used by energy suppliers to attract new customers or lure switchers from rival firms – from 1 October 2024. It has consulted on this and is due to reach a final decision imminently.

Existing customers would not have access to these deals and Which? is concerned consumers who want to stay with their current supplier could be left worse off. These customers – and new ones whose initial deal expires – face being hit by so-called “loyalty penalties” as their bills jump in subsequent years.

New Which? research shows the public are opposed to cheap deals that exclude existing customers.

The consumer champion has written to the regulator alongside Eon, Octopus, So Energy, Rebel Energy, End Fuel Poverty Coalition, Citizens Advice and Fair by Design, calling for it to reconsider its proposals to lift the ban on acquisition-only tariffs.

In the letter, the organisations warn of the risk of “a return to a market which discriminates against loyal customers”. They also raise the potential impact on customers in debt, who may not be able to switch but could also find themselves struggling to access a better deal with their current supplier under the plans.

The letter highlights the lessons of recent history, when more than 30 suppliers went bust – many after trying to win customers with unsustainably cheap tariffs.

Which?’s latest survey findings show eight in 10 (81%) people would think it was unfair if their supplier was offering cheaper deals to new customers only. A similar number (78%) said they would think this was unfair even if they would potentially benefit in the short term by signing up to a discounted deal.

Rocio Concha, Which? Director of Policy and Advocacy, said:

“Our research has shown that consumers overwhelmingly believe cheaper energy deals only available to new customers are unfair – even when they might stand to benefit.

“That’s why Which? and a coalition of energy firms and consumer organisations have written to Ofgem warning them not to lift the ban on acquisition-only pricing.

“Allowing deals exclusively for new energy customers could open the door to loyalty penalties and would come at the expense of those who wish to stick with their current supplier on their best deal.”

A spokesperson for the End Fuel Poverty Coalition, commented:

“Removing the ban on acquisition tariffs will create price discrimination against loyal customers and also hurt further the millions of households who can’t switch to a new supplier because they are in energy debt.

“Removing the safeguard also means risking a return to the unsustainable form of competition in the energy market that existed before 2021. Suppliers collapsed partly because they had grown too quickly in a market driven by acquisition tariffs.

“Ultimately energy bill payers bore the heavy price of these collapsed firms through the Supplier of Last Resort programme which added billions to households’ standing charges.”

ENDS

The joint letter is available on the Which? website at this link.

Two-thirds of bill payers call for automatic energy credit refunds

Over two thirds of bill payers (68%) are calling for energy suppliers to automatically return any credit in their account after winter following the success of a mass protest which saw 20,000 demand their cash back. [1]

Over 20,000 customers joined the Big Energy Credit Claim Back launched in May, which urged supporters to reclaim unused customer credit. The campaign is set to end on July 1 when households need to start saving again for winter.

The protest was launched after an investigation revealed UK energy suppliers are sitting on over £3 billion worth of customer credit, with nearly a third of UK households (32%) in the black to their energy supplier all year.

Further analysis found that the combined bank interest energy suppliers have made through customer credit balances was at least £159 million in 2023.

Bill payers have claimed back an average of £330 [2] from energy suppliers in the mass protest organised by the Warm This Winter coalition which is now calling on the next Government and Ofgem to introduce an automatic credit return of people’s cash after each winter.

Warm This Winter spokesperson Fiona Waters said:

“People are fed up with energy suppliers keeping hold of their cash, making millions in interest on it and then customers often struggle to get their money back from reluctant suppliers. It’s common sense that after winter, if they have credit on their account it should automatically be returned to them and that’s why so many people joined the Big Energy Credit Claim Back.

“The campaign proves that by a simple measure, bill payers can slash on average over £300 from their annual energy bills which is much needed and there is no real reason why an automatic cash back isn’t implemented.”

Customers who pay their energy bills by direct debit are incentivised with better deals to spread payments over 12 months, building up a pot of credit from July onwards to cover the winter months when they will be using more energy on heating.

In May, if their account is in credit, then experts, including Martin Lewis have pinpointed this as the time to reset their balance and get back credit before they start saving again in July.

But under the current system, this is not automatic and instead the onus is on consumers to claim back their credit which can be complex and in some cases suppliers do not return the excess credit.

New research by Warm This Winter on how easy it is to claim back credit revealed nearly a third of bill payers found it difficult to get credit back.

Over a quarter (26%) felt their direct debit payments had been set too high, with OVO first for high direct debits (31%), followed by British Gas and Eon Next (29%) and EDF taking third place at 28%.

Of those who got their credit back, just over half (56%) were paid quickly, for 17% it was paid after a fortnight or more, with 12% still waiting for their money to be returned at the time of polling and 12% were refused their money even though they were in credit.

And over a quarter (28%) never even attempted to claim back their credit.

A spokesperson for the End Fuel Poverty Coalition commented: “Credit hoarding by energy suppliers must become a thing of the past.

“Over a third of people in permanent credit to their energy firms live in households with low incomes and may have cut back on energy use or other essentials because the direct debits set by energy firms are far too high.

“Let’s hope that once general election fever is over the regulator wakes up and introduces a new licence condition on suppliers that credit balances are refunded after each winter on an opt out basis.”

The Warm This Winter research conducted by Opinium this month which surveyed over 2,000 people across the UK also revealed a third of people (33%) who paid by direct debit found understanding how their direct debits were calculated was difficult and a similar number (32%) of UK adults felt it was also hard to understand how much energy they use.

Groups that also backed the Big Energy Credit Claim Back include 38 Degrees, National Pensioners Convention and Fuel Poverty Action, have also called for Ofgem and the next government to close this loophole.

Matthew McGregor, CEO of 38 Degrees said:

“The fact that so many people have taken matters into their own hands by joining this campaign shows just how broken our energy system is – and how much people are still struggling with the cost of living.

“We are currently in the midst of a cost of living election, and the next Prime Minister must take bold action to support struggling families – such as by establishing a proper social tariff for energy bills.”

Jan Shortt, General Secretary of the National Pensioners’ Convention said: “It is important that energy suppliers play fair with their customers. Holding onto excess credit and collecting interest is not acceptable when everyone is still finding it hard financially.

“Energy suppliers making it difficult for customers to be repaid their credit must be taken to task by the Regulator. Clearly, automatic repayment is the answer as the onus is not on older people to search for ways to get their credit back.”

Jonathan Bean from Fuel Poverty Action added:

“It’s disgraceful that Ofgem has allowed energy firms to hoard our money during the cost of living crisis. Our money should be refunded automatically, with interest. Energy firms are deliberately overcharging and making it hard to get the refunds we are due. This exploitation must stop.”

ENDS

[1] Opinium research conducted a nationally and politically representative online survey of 2,185 UK adults between 29th and 31st May 2024.

[2] Based on respondents to the Warm This Winter follow up survey of BIg Energy Credit Claim Back supporters, week commencing June 10.

Changes could halve energy standing charges

A new discussion paper that would see energy standing charges reduced has been published by campaigners.

Future Energy Associates have identified how standing charges for every household with electricity and gas connections could plummet from £334.08 a year to £183.02 – a reduction of almost half (£152.06 / 46%).

For electricity the standing charge would reduce from £219.42 to £149.17 per year (32% reduction) and for gas the standing charge would reduce from £114.66 to £33.85 per year (71% drop).

Delivering these changes would require changes to Ofgem regulations and Government funding as well as action taken to protect low income and high usage households, such as those who rely on energy for medical needs.

This could include the introduction of a social tariff, which is backed by well over half the population according to recent polling by Opinium, and could be paid for through contributions from energy industry profits (producers, networks and suppliers).

The analysts identified that up to £5bn a year of costs on energy bills could be moved to general taxation. Policy makers could remove these costs from all bills, which would bring down electricity unit rates as well or (for a lower cost to the Treasury of around £200m a year) remove the costs just from vulnerable low income households with high energy needs.

The options paper commissioned by the Warm This Winter campaign includes moves to:

Transfer five elements of standing charges (the adjustment allowance, headroom allowance, profit allowance, payment uplift and levelling costs) entirely to the unit rates.
Shift some policy costs to general taxation.
Revise the ratio of operating costs paid through standing charges versus unit rates to increase the amount on unit costs, thereby delivering an incentive to the energy market to drive down excess costs such as marketing.
Reduce the standing charge elements of network costs by 10%, funded by excess shareholder profits.
If all these options were taken together (i.e. changes to standing charges and unit costs) these proposals would reduce the total energy bill for the average household by £214.22 a year.

Dylan Johnson, one of the analysts involved in the report, said:

“The comprehensive changes we have suggested would bring down standing charges and could also mitigate negative distributional impacts of standing charge reform previously identified by Ofgem. We would urge new ministers to meet with industry, consumer groups and experts to analyse how we can change standing charges in a way that is fair to all households.”

A spokesperson for the End Fuel Poverty Coalition, commented:

“Standing charges are an unfair flat tax on every energy consumer. Every household pays through the nose just to be connected to the grid, even if they use no energy.

“In the past there has been caution about reform due to the potential impact of change on households with a high dependency on energy for medical needs, we still need further detailed analysis of these options by Ofgem to ensure that this group is not penalised.

“However, this report does indicate that reform of standing charges may actually be possible in a fair way. It will need Ofgem, the next Government, energy industry and consumer groups to work together to make it happen. The prize of cutting standing charges in half before this winter should be one which new Ministers seize upon.”

Jonathan Bean from Fuel Poverty Action added:

“Millions of us are suffering energy starvation due to high standing charges that leave no money for heating, hot water or power. Many on prepayment meters get cut off. This cruel energy system needs urgent reform by the new Government.”

Warm This Winter spokesperson Fiona Waters said:

“The energy crisis has already left bill payers £2,500 out of pocket since it started three years ago and we know energy bills will go up again in October.

“People up and down the country are literally at breaking point, are still paying 50 percent more for energy and at the heart of these unfair bills are the standing charges. The public are crying out for action now.

“The next UK Government will need to act quickly, bring down bills for good, end energy debt, improve housing standards through insulation and ventilation and also make Britain a clean energy superpower so we are not at the mercy of profiteering global oil and gas giants.”

For customers in energy debt, campaigners have also called for a universal, consistent, nationwide, debt matching programme funded by the £1.3bn customers are paying through bills for energy debt costs this year.

ENDS

Standing Charge Reduction Analysis by Future Energy Associates is available to download: https://www.endfuelpoverty.org.uk/wp-content/uploads/Standing_Charges_Final.pdf

Public backs social tariff to cut vulnerable households’ energy bills

The public have given their backing to the next Government radically altering the support available to households with their energy bills.

New polling by Opinium for the Warm This Winter campaign has revealed that 57% of the public back a social tariff, which is designed to offer cheaper energy to vulnerable households.

While 32% were neutral or didn’t know if they backed it or not, just 11% of the public opposed the proposals.

A social tariff is a discounted energy bill for people in greatest need, such as those people that have low incomes and are elderly, have young children or rely on energy for medical needs.

The cross-party House of Commons Energy Security and Net Zero Committee of MPs recommended last year that this be introduced along with other reforms to help vulnerable households stay warm each winter.

Voters of all parties backed the plans with 68% of 2019 Labour voters, 60% of 2019 Lib Dems and 54% of 2019 Conservative voters supporting a social tariff. The policy is most popular in Scotland (61%) and even in London more than half back the proposals (51%).

When it comes to paying for the policy, a quarter of voters believed that it should be fully funded through the energy industry (producers, networks and suppliers). A similar number backed a mix of Government funding and energy industry contributions.

There was less support for other proposals, such as contributions via energy bills or paying solely for the policy through general taxation.

The updated energy industry profits tracker shows that over £427bn in profits have been generated by firms since the start of the energy bills crisis, up £7bn since the last update in April 2024. An estimated £1,100 per household in profit has been generated by network operators and transmission firms alone. [2]

A spokesperson for the End Fuel Poverty Coalition commented:

“Protecting vulnerable consumers from energy prices that remain way above 2021 levels is a popular and easy to implement policy that the next Government must prioritise.

“The public would support this being paid for by the whole energy industry. Producers, transmission firms, network operators, market traders, suppliers and their supply chains could all chip in through their profits to make this happen.”

Warm This Winter spokesperson Fiona Waters said:

“Energy bills will go up again in October and years of staggering prices have taken their toll.

“We now know the true cost of the crisis which will be with us for the foreseeable future. Customers are already £2,500 out of pocket because of Britain’s broken energy system, people are turning to loan sharks to pay their energy bills, millions of people are living in energy debt, in cold damp homes and many are experiencing a mental health crisis driven by high bills.

“This is why we need the next Government to act quickly after the election to end energy debt, protect households from the volatile global energy market, bring down bills for good, improve housing standards and make Britain a clean energy superpower.”

On energy debt, campaigners have also called for a universal, consistent, nationwide, debt matching programme funded by the £1.3bn customers are paying through bills for energy debt costs this year.

Dan Scorer, Head of Policy and Public Affairs at Mencap said:

“People with a learning disability often use more energy for essential mobility, health and sensory needs.

“Too many are being left in fuel poverty: nearly 40% of people who responded to a Mencap survey said they had kept their heating off despite being cold. Over a quarter said they avoided switching lights on to save money.

“Whoever forms the next government must immediately tackle the energy affordability crisis by introducing an energy social tariff so people with a learning disability can live happy and healthy lives.”

Graham Easterlow, CEO of East Durham Trust, said:

“We have seen a 90% rise in household debt involving energy bills. Our debt centre used to write off a majority of unsecured debt made up of credit cards, loans and store cards, now we are seeing household bills of thousands of pounds being written off through debt relief orders.”

More than 41,000 members of the public have also signed a 38 Degrees petition, demanding a social energy tariff for vulnerable people, further demonstrating public support for the measure. Matthew McGregor, CEO at 38 Degrees, said:

“No one should be left in the cold for yet another winter – whether it’s struggling families, people surviving on limited pensions or those with disabilities who may need extra power.

“Voters want to see the burden of enormous energy bills lifted off the shoulders of those struggling the most, with support funded by the huge profits the energy industry is raking in.”

Maria Carvalho, Campaigner at health charity Medact added:

“Homes are the foundation of good health and no one should be left to freeze in their own home. Health workers are working tirelessly but can only plaster over the impacts of cold homes, from respiratory conditions to child development. At the same time the crisis of cold homes costs the NHS more than 2.5 billion a year.

“Despite health workers’ best efforts, the effects of treatment can’t last if patients go straight back to a cold home where they are struggling to cover their sky high bills. The solution to this public health crisis lies in energy reforms like a social tariff which would mean that no one is cut off from their basic right to energy.”

ENDS

[1] Opinium conducted an online survey of 2,185 nationally and politically representative UK adults between 29th and 31st May 2024.

The last update was on 1 April 2024 which showed industry profits of £420bn with £30bn from networks and transmission.

If any firm wishes to inspect or correct the records, please email info@endfuelpoverty.org.uk.

Call to end the punishment of energy debt

Households in energy debt are being punished by a system designed to trap them in years of misery, according to new figures.

The data from the Warm This Winter campaign has revealed that two thirds (67%) of people in energy debt say it has caused them emotional distress and two-fifths (42%) say it has caused them to eat fewer hot meals in order to cut down on energy use. [1]

The figures come a month after the House of Commons Energy Security and Net Zero Committee heard how one in five (18%) of households in energy debt are turning to illegal money lenders to pay for their bills and everyday essentials. Among younger households, a quarter (24%) of under 35s and a third (32%) of customers aged 35-44 are turning to illegal money lending.

For many in energy debt, energy firms will suggest moving to a prepayment meter (PPM), which enables customers to pay off their debt every time they top up their meter. But the research indicates that the suffering of households in debt on prepayment meters is even worse than for those on direct debit.

Levels of emotional distress increase among PPM customers in debt (93% on PPM / 58% on direct debit) as do the numbers reducing hot meals (60% on PPM / 38% on DD). And the numbers turning to illegal money lending are also significantly higher for PPM customers (36% PPM / 13% DD).

The respondents to the research shared their harrowing stories anonymously with researchers [2]. A prepayment meter customer wrote:

“My energy debt was the reason [I moved] from credited monthly bills towards prepayment meter. It [has caused the] cutting off electricity so many times. It causes disruption and, in my opinion, barely legal. I think that law should protect people who suffer from financial hardship in the context of electricity bills.”

Another respondent said:

“I think it is disgraceful during a cost of living crisis and having severe health problems that the energy companies have been allowed to put up their standing charges so if I do not use any gas or electricity I will pay £390 a year. The price of the electricity and gas is disgraceful and even though the energy firms say they are there to help they send threatening letters stating they will force entry and install a prepayment meter to peoples households, plus if you are late paying they charge £10 then £35 etc.”

One pensioner commented:

“I sit in the house with the lights out and only have my heating on for an hour. What else can I do? My account should not be in debt for the amount I use. It’s disgusting and they are making millions in profits.”

Meanwhile one participant in the research commented on the toll it is taking:

“I work hard and always have done, facing the situation from the energy crisis has left me with little to no money to be able to afford other essentials like clothing. It is incredibly depressing sometimes and not conducive to good health.”

A spokesperson for the End Fuel Poverty Coalition commented:

“Millions of households have fallen into energy debt due to the record high prices. The average household has had to find £2,500 in the last few years just to keep their energy usage where it was. When combined with the ongoing cost of living crisis, this is a figure well beyond people’s means.

“While the energy industry has pocketed the profits, struggling families have been abandoned.

“Energy debt is forcing households to wake up in the morning scared of the consequences of using electricity or gas. It’s time to end the punishment of energy debt.

Campaigners have called for a universal, consistent, nationwide, debt matching programme funded by the £1.3bn customers are paying through bills for energy debt costs this year.

Warm This Winter spokesperson Fiona Waters said:

“The next Government will need to act quickly after the election to end energy debt, protect households from the energy market, bring down bills for good, improve housing standards and make Britain a clean energy superpower. All we have had so far from politicians are warm words that they understand the crisis. What we need are concrete promises of action.”

Jonathan Bean from Fuel Poverty Action said:

“A cruel combination of energy debt, prepayment meters and high standing charges is making life a misery for millions of us.”

ENDS

[1] Research was conducted among 500 people across the UK living with energy debt (previous nationally representative polling among 2,000 people revealed that 15% are experiencing energy debt). The interviews among those in debt were conducted online by Sapio Research between April and May 2024 using an email invitation and an online survey.

Results of any sample are subject to sampling variation. The magnitude of the variation is measurable and is affected by the number of interviews and the level of the percentages expressing the results. In this particular study, the chances are 95 in 100 that a survey result does not vary, plus or minus, by more than 4.4 percentage points from the result that would be obtained if interviews had been conducted with all persons in the universe represented by the sample. Sample was selected from Online partner panels.

Key statistics national variations (NI samples too small to be representative):

	All UK	Scotland only	Wales only
Use of illegal money lending	18%	13%	17%
Causes emotional distress	67%	67%	78%
Cuts down on hot meals	42%	30%	57%

Debt and disability

– 21% of people with a disability or long term illness and who are in energy debt have turned to illegal money lenders (18% of those in debt more generally)

– 52% of people with a disability or long term illness and who are in energy debt have cut back on hot meals (43% of those in debt more generally)

– 74% of people with a disability or long term illness and who are in energy debt say the debt has caused emotional distress (67% of those in debt more generally)

[2] Respondents to Q9: Line 130, Line 19, Line 50, Line 60, Line 37, Line 189.

General election candidates asked for views on ending fuel poverty

After years of staggering energy bills, candidates in the General Election have been asked to give their views on the steps they will champion to help end fuel poverty.

New Ipsos polling has revealed that the cost of living crisis is the second most important issue to voters heading to the polls.

Now the End Fuel Poverty Coalition has launched a survey which asks candidates three questions about the cost of energy and the cold damp homes scandal.

Campaigners have claimed that the next Government will need to act quickly after the election to end energy debt, protect households from the energy market, bring down bills for good, improve housing standards and make Britain a clean energy superpower.

Voters can also use the survey when MP hopefuls arrive at their door, so they can find out who is most likely to get to grips with fuel poverty and so they don’t have to face another winter choosing between eating and heating.

The poll asks candidates if they think the cost of energy bills is an issue for people living in their constituency and then asks them to rank a set of four solutions in priority order.

The solutions include targeted financial support for energy bills, help to upgrade homes, access to cheaper energy and a long term plan to get off oil and gas.

The final question asks candidates what they will do to help end fuel poverty if they get elected.

A spokesperson for the End Fuel Poverty Coalition, commented:

“Anyone standing for Parliament needs to be left in no doubt that the public is angry about vulnerable people living in cold, damp homes, whilst prices rise and the energy industry profits.

“Candidates will need to go into their new role as an MP ready to take responsibility and demand urgent action on behalf of those they represent. Nothing less will do.”

Research from winter 2023/24 has highlighted that 8.3m million people live in cold, damp homes with the NHS warning that they are more likely to have respiratory problems, respiratory infections, allergies or asthma.

Over a third (38%) of people from households where someone is under 5, pregnant, over 65 or with preexisting health conditions thought they might not be able to afford to put the heating on at all this winter.

Nearly four in 10 UK households (39%) say they cannot afford to insulate their homes.

Scottish public call on Ministers to fix nation’s damp homes

An overwhelming majority of the public have called on the Scottish Government to do more to end the cold damp homes crisis.

New figures published in the Daily Record found that 94% of the public wanted action designed to offset the challenges caused by record energy prices. [1]

The data commissioned by the Warm This Winter campaign found that the public was divided among the solutions they wanted to see, but there was clear support for more financial help for households as well as action on the long term solutions to the energy crisis, such as energy efficiency and insulation support.

51% of the public want more government financial support to help households with high energy bills
50% demand funding and support to install solar panels on homes
38% support more funding to help with insulation in homes
30% say there should be help for businesses to install solar panels or other small-scale renewable projects
29% back better protection for tenants living in rented accommodation
26% think there should be better energy efficiency advice and guidance
25% want more funding to help install heat pumps
3% would like more measures to tackle high energy bills, but don’t know what solutions they would like to see
6% don’t support any of these solutions to tackle high energy bills (respondents could select more than one option)

Recently members of the Scottish Parliament were urged to put political differences aside to unite in support measures that will help end fuel poverty.

In a letter sent to all MSPs and to Scottish Government ministers, politicians were asked to ensure the new First Minister does not abandon government policies which could help end the cold damp homes crisis.

The letter, signed by leading civil society organisations and coordinated by the End Fuel Poverty Coalition and Energy Action Scotland, warned that among the most vulnerable, the crisis is even worse. It came after figures from research among Social Workers Union members found that 69% of Scottish social workers have seen the people they support living in cold damp homes and 400,000 Scots live in uninhabitable conditions.

The campaigners have demanded that MSPs from across all parties to unite in support of:

A Heat in Buildings Bill which is ambitious in its vision for improving the energy efficiency and insulation of the nation’s homes and contains a clear fuel poverty duty enshrined in the legislation.
The current Housing Bill that will enhance tenants’ rights and provide financial protections for tenants during the ongoing cost of living crisis.
Additional Government support in future budgets and legislation to help households cope with the cost of living crisis.
Reintroducing the Fuel Insecurity Fund to help at least those most at risk of harm and struggling in energy debt.
The new Pension Age Winter Heating Payment being fundamentally better targeted than the Winter Fuel Payment that it replaces.
A strengthened framework of support for the renewables and offshore wind sectors and the fastest possible “just transition” for the oil and gas sector, as described in the Draft Energy Strategy and Just Transition Plan.

National organisations that supported these asks ranged from the Poverty Alliance and the Disability Poverty Campaign Group to Fathers Network Scotland, the National Pensioners Convention and Parents for Future Scotland.

Local groups, such as Aberdeen Heat & Power, East Kilbride Housing Association, East Lothian Foodbank, Stirling District Citizens Advice and Tighean Innse Gall also backed the call.

A spokesperson for the End Fuel Poverty Coalition, commented:

“These figures show that while different households back different types of support to combat the cold homes crisis, everyone is united in demanding action from the new First Minister.

“Part of the long term solution to record energy prices is to improve insulation, ventilation and energy efficiency of homes to reduce our consumption of energy overall. Abandoning a Heat in Buildings Bill now would fail people struggling in cold damp homes.”

Frazer Scott, Chief Executive Officer at Energy Action Scotland, said:

“With one in three households in Scotland in fuel poverty and household energy debt rising, it is clear that the public are demanding that more needs to be done to help with the costs of essential energy.

“Almost half of people in Scotland live in an inefficient, expensive to heat and power home. People need to see action from leaders and decision makers that will improve homes, reduce costs and support people to live a decent quality of life.

“The cost of failing to help people will be measured in the misery of far too many of our households, declines in health & wellbeing and ultimately the unnecessary loss of life from living in a cold damp home.” [2]

Fi Waters, spokesperson for the Warm This Winter campaign, added:

“The First Minister has pledged to tackle child poverty and a good place to start is in the home. All children deserve a warm, dry home, in fact it should be a basic human right for all Scots, which is why policies such as the Heat in Buildings Bill needs to be a central pillar of his parliament.

“Our polling found over half of Scottish people want more government help for people struggling to pay high energy bills, half want to see more funding for solar panels and four in ten more money for insulation.

“The Scottish people have spoken and want a government that will fix the broken energy system by investing in a proper programme of home insulation and homegrown renewable energy to get them off expensive oil and gas and bring bills down permanently. Swinney should listen.”

ENDS

[1] ScotPulse interviewed 2,660 Scottish adults aged over 16 between 7-10 May 2024. Results were weighted by gender and age to Scottish adult population estimates 2021.

[2] Scottish Government published the Scottish House Condition Survey for the year 2022 on 29th February which confirmed that at least 31% of households in Scotland were in fuel poverty and that this was a likely underestimate. It estimated that 37% of households were likely to be in fuel poverty at end March 2023. The 2022 survey identifies that 48% of properties did not reach an Energy Performance Certificate rating of ‘C’, which the Scottish Government determines to be efficient.

Rip Off Britain energy special highlights energy debt dramas

After almost four years of sky high energy bills and repeated Ofgem rulings criticising energy firms’ customer service, BBC’s flagship Rip Off Britain programme has broadcast an energy special.

Billing errors, smart meter malfunctions and soaring levels of energy debt were discussed over the course of the 45-minute long programme, fronted by Angela Rippon, Gloria Hunniford and Julia Somerville.

Warm This Winter data has found that 4.4m households (15% of the public) are in energy debt. This figure is far higher than the 2.5m estimated by Ofgem, which only counts a household being in debt if the debt is more than 90 days old. [1]

Joining the programme was the coordinator of the End Fuel Poverty Coalition, Simon Francis, who said:

“Millions of people are in energy debt and with the prices of energy still 50% above 2021 levels, the strain households are being put under is intolerable.

“Indeed, a fifth of people in energy debt are also turning to illegal money lenders due to the strain on their finances. The ongoing energy bills crisis is causing horrendous implications for households and wider society.

“Warm This Winter campaign research found that £1.3bn of consumers’ money is being given to energy firms to administer bad debt this year. But not all of it will be used to actually write off the debt caused by soaring energy prices and record energy industry profits.

In the programme, the energy industry was called on to back a Help To Repay scheme for energy debt which would see the £1.3bn – or money raised by the Windfall Tax on energy profits – used to match consumer repayments of energy bills.

The programme also offered advice to viewers including one who was struggling to get their energy firm to set a reasonable direct debit. In response, the show highlighted recent Warm This Winter Tariff Watch reports which found that customers who are experiencing bad customer service may be prevented from switching by exit fees which have increased 345% in recent years.

Recently more than 14,000 consumers have signed up to take action to reclaim credit from energy bills built up as their direct debits were set too high. The organisers behind the “Big Energy Credit Claimback” revealed that over a third of households in permanent energy credit are also on low incomes. [2]

Warm This Winter campaign spokesperson Fiona Waters commented:

“Everyone is fed up with being ripped off and used as cash machines by energy suppliers. Even with Friday’s price cap reduction, people are still paying 50 percent more than they were three years ago.

“That’s why thousands have joined our Big Energy Credit Claim Back protest because energy suppliers have been consistently overcharging them and are sitting on £3 billion of credit that is owed to bill payers and those companies have made millions in interest.

“We urge everyone to join us and send a wake up call that we demand change to our broken energy system, You can find out all about that on our Warm This Winter website.”

The programme can now be watched on catch up, iPlayer or online at bbc.co.uk/ripoffbritain.

ENDS

[1] Public opinion polling from Opinium who interviewed 2,000 people between 15 and 19 March 2024. Results were weighted to be representative of the UK population.

[2] Figure is a combination of sign ups to 38 Degrees and Warm This Winter online actions and was correct as of 1700 on Friday 24 May 2024.