ParliamentRead on for a brief on fuel poverty and cold homes ahead of a Westminster Hall Debate initiated by the Liberal Democrat MP Roger Williams.

BACKGROUND BRIEF ON FUEL POVERTY AND COLD HOMES

WESTMINSTER HALL DEBATE, TUESDAY 11 FEBRUARY

ROGER WILLIAMS MP

  •  The Countryside Alliance welcomes this debate on fuel poverty and cold homes.
  • The DECC definition of fuel poverty is: “Households in fuel poverty are those that are at risk of being unable to afford to heat their homes to an adequate standard. A household is said to be in fuel poverty if it needs to spend more than 10% of its income on fuel to maintain an adequate level of warmth.”
  • More households in rural areas are in fuel poverty than the national average. In 2010 around 18% of households in rural areas were in fuel poverty compared with 16% of those in urban areas.
  • Households in rural areas are more likely to be off the gas grid and reliant on more expensive fuels such as oil and LPG than those in urban areas – 36% in rural areas compared to 8% of urban households – both of which have both risen in price significantly over the course of the last few years.
  • In ‘rural sparse’ areas 60% of households were off the gas grid in 2009.
  • We are particularly concerned about the impact of high fuel prices to off-gas grid households which are forcing more rural households into fuel poverty.
  • Rural households often have to make tough decisions between heating their home and paying for other essential household expenses.

There are three main causes of fuel poverty:

  1. Poor energy efficiency performance of housing
  2. Low income levels
  3. High energy costs

1. Poor Energy Efficiency Performance of Housing

  • Hard to treat homes (generally defined as being off mains gas and having solid walls) are mainly in rural areas and account for over 50%of the UK’s total carbon emissions from housing.[1]
  • Installing energy efficiency measures in rural areas costs more due to greater distances between households and a greater number of hard to treat properties (solid walls and off mains gas).
  • Hard to treat homes need more expensive internal and external solid wall insulation and in the past have not been included in government grant schemes such as Warm Front and the Green Deal. 34% of homes in rural areas are classed as hard to treat.[2]
  • There are a high number of ‘off mains’ gas properties in rural areas and difficulties with fitting alternative renewable energy heating systems, which are not always suitable for rural properties, are expensive to install and sometimes require an upgrade to rural power lines.

 2. Low Income Levels

  • Householders, eligible for grants are often unable to afford ‘Top-Up Costs’ (the difference between the total costs of the works and the available grants). The grant scheme, Warm Front, said cancellations of energy efficiency measures due to inability of consumers to pay top-up costs were high. Prior to the increase in grant rates, cancellations of work in urban areas due to top-up costs were 26.4%, whilst in rural areas they were 73.6%.[3]
  • The lack of up to date data to identify fuel poor households makes targeting energy efficiency measures difficult.
  • There is a lack of awareness among low income householders and those eligible for certain welfare benefits as to which grants are available for home energy efficiency and what the best energy deals are to suit individual households.

 3. High Energy Costs

  •  Many rural households pay much more for their energy supply than households connected to both the gas and electricity network. It costs £2175 per year to heat a three bedroom house using liquid petroleum gas (LPG), £1,575 using domestic fuel oil and £975 by mains gas[4].
  • Homes using oil and LPG as their main heating fuel are much more likely to use secondary heating than homes using other fuels. 89% of heating oil consumers in England, 82% in Scotland and 85% in Wales use other fuels for secondary heating, most often solid fuel. By contrast, only 23% of consumers (in England, Scotland and Wales) with mains gas heating use other fuels for secondary heating.[5]
  • The cost of a tank of heating fuel has fluctuated during the past year but in December 2013 prices were running at 14% higher than the previous December – and 20 % more than in the summer.
  • Private Sector Landlords have no incentive to improve the efficiency of their housing stock as the tenants not the landlords pay the energy bill.
  • For many, the consequences of fuel poverty are discomfort, ill-health and debt. Cardiovascular and respiratory illnesses, such as Asthma, are exacerbated when people are living in cold, damp and poorly ventilated homes. In 2006 hospital admissions for pneumonia for people between the ages of 60-80 cost the NHS almost a quarter of a million pounds (£243,439). Not all of those admissions were the direct result of poorly heated, damp homes, but the NHS recognises that in many cases these are contributory factors, especially for older people.
  • The previous government’s discussion paper, published in July 2009, “Working together for older people in rural areas” acknowledges that “a higher proportion of older people in the most rural areas live in poor housing and experience fuel poverty than in other areas” and the report also confirms that approximately 300,000 older people are living in rural fuel poverty.

 COUNTRYSIDE ALLIANCE RECOMMENDATIONS

  • Government grant programmes aimed at alleviating fuel poverty and improving household energy efficiency should have specific funds, targets and suitable measures for hard to treat and off mains gas homes.
  • Winter Fuel Allowance payment is made earlier to off-gas grid households, so they can take advantage of more favourable rates offered earlier in the year.
  • Increase consumer protection to the off-gas grid sector by ensuring it is covered by the same regulator as the on-grid sectors.
  • Local Government, Housing Associations, the Energy Saving Trust etc should investigate sharing information on procurement programmes and prices for renewable energy installations such as ground source heat pumps and look into consortium agreements with a view to negotiating lower installation and unit costs.
  • Local Authorities should work closely with energy installers to look at ways of reducing costs to service remote rural areas such as developing clusters.
  • As part of the process of addressing rural fuel poverty there also needs to be recognition and support for the role British farmers and land managers can play in exploiting the huge potential offered by agriculture in providing renewable energy sources. The Countryside Alliance has long called for, as stated in its Rural Manifesto, “the potential of farming and its by-products as a significant and often existing source of renewable energy to be harnessed not only as a way of mitigating climate change but also of increasing our energy mix and therefore our energy security.”
  • The Government’s interest in using the by-products of, and waste generated from, agricultural and primary industry to provide energy in the form of bio-gas could increase economic activity and jobs in rural areas and is to be welcomed.  There is, however, a need for swift and decisive action in this area.  When it comes to anaerobic digestion, for example, Germany had over 2,500 anaerobic digestion plants in May 2008, compared to only 23 in the UK.[6]
  • Approximately 90 million tonnes of agricultural material such as manure and slurry are produced in the UK annually. Initial estimates suggest that this waste, in combination with other waste types, could produce around 10-20 TWh (Tetra Watt hour) of heat and power by 2020[7].

[1] Understanding the Real Depth and Impact of Fuel Poverty in Rural England, Rural Services Network, September 2010

[2] Centre for Sustainable Energy Report to Eaga Partnership Charitable Trust from July 2008

[3] Understanding the Real Depth and Impact of Fuel Poverty in Rural England, Rural Services Network, September 2010

[4]Off Gas Consumers: Information on Households without Mains Gas Heating, Consumer Focus, October 2011

[5] Off Gas Consumers: Information on Households without Mains Gas Heating, Consumer Focus, October 2011

[6] Policy Exchange, A Wasted Opportunity, July 2009

[7] Defra. Anaerobic Digestion – Shared Goals, February 2008