- National Energy Action is warning that millions could enter fuel poverty
- It comes amid an energy crisis where wholesale prices continue to rise
- Many families are now worried about how they will pay their bills
- It’s Money Tells Whether Help Is Available
A charity has warned that millions more families could plunge into fuel poverty if energy prices continue to rise.
National Energy Action, which campaigns for everyone to live in a warmer home, has said the energy crisis means ‘it is creating a brutal and foggy winter for millions of people.’
As energy prices have risen dramatically over the past few weeks, many consumers have expressed concern about how they will pay their bills in the coming months, when costs are likely to be even higher.
Millions more families could fall into fuel poverty if energy prices continue to rise
While many people will be protected by the energy price cap, it is expected to rise once again next April, potentially hundreds of pounds, leaving millions of households unable to pay their bills.
If the price range rises to between £400 and £600, the NEA said, the number of UK fuel poverty-stricken households could rise to between 1.2 million and 1.5 million.
This would mean that 5.5 million households could struggle to heat and power their homes.
This Is Money takes a look at how the energy crisis is affecting homes and what experts predict may happen over the next few months.
What is fuel poverty?
According to the government, a family is considered fuel poor if they are living in a property that has a fuel poverty energy efficiency rating of Band D or below, and when they spend the amount needed to heat their home. , then they are left with residual income below the government poverty line.
Factors that contribute to fuel poverty include household income, household energy requirements, and fuel prices.
There are currently around four million UK households in the grip of fuel shortages, unable to heat their homes to the temperatures they need to keep them warm and healthy.
Why are prices rising?
Currently, energy prices are rising as the cost of bulk gas has increased dramatically. This means that suppliers are being charged more, and those price increases are being passed on to consumers.
The crisis is triggered by a number of factors, but is ultimately due to a decrease in natural gas production as well as an increase in demand.
Demand has picked up faster than expected after the global pandemic, but reserves have been slowing this summer as supplies from Russia are lower than predicted.
The longer and colder than usual last winter has not helped the situation.
Renewable sources such as solar power and wind have also produced less, creating a greater reliance on gas.
Experts are calling on the government and the offgame to provide more support to at-risk homes
Will the government take steps to help the fuel poor?
National Energy Action is calling on the government and offgame to protect customers most likely to be affected by rising energy prices.
Adam Schorer, CEO of National Energy Action, said: ‘This crisis is going to come with a vengeance. A hammer blow for those able to ride with the least amount of punches. It is turning into a brutal and foggy winter for millions.
‘The decisions we make now will determine whether this is a crisis through which we support the most vulnerable families, or a disaster in which we allow them to fall.
‘Domestic energy consumers have suffered an increase of over £2 billion per year spent on energy due to the recent price cap increase.
“We want Offgame to ensure that vulnerable consumers are not put at risk when their supplier fails and provide deep protection for low-income consumers.”
‘The central government should provide more direct financial support by extending schemes such as the warm home discount or extending winter fuel payments to other households.
‘Long-term, we cannot lose sight of the need to reduce our exposure to gas prices by investing in household energy efficiency, prioritizing the poorest households over the least efficient.’
What assistance is available for families?
Anyone struggling should talk to their energy supplier to see if they can help, for example by creating a payment plan.
There are also many schemes that families can benefit from.
Eligible households could get £140 off their electricity bill for the winter 2021 to 2022 under the Warm Home Discount scheme, which officially opened on 18 October 2021.
The money is not paid directly to the customers, but a one-time discount on the electricity bill of the household between October and March.
Customers may be able to get a discount on their gas bill if their supplier provides both gas and electricity to them and should contact their provider to find out.
There is also a Cold Weather Payment Scheme, where eligible households receive a £25 payment when the temperature recorded at their local weather station is at or below zero °C for seven consecutive days.
Others may benefit from a winter fuel payment which is an annual lump sum payment to help pay for heating during the winter.
If you were born on or before 26 September 1955 you can usually get Winter Fuel Payments.