Government must switch on to help vulnerable energy customers this winter

Energy suppliers and consumer groups are calling on the Government to look now at bill support for customers this winter – including options such as a social tariff for next year and beyond.

Energy UK – along with Citizens Advice, Fair By Design, MoneySavingExpert and National Energy Action – are calling for the Government to publish its planned consultation on a possible social tariff and other options for customer support. As Parliament goes into recess until September, it will now be very challenging for the Government to deliver on its pledge to introduce better targeted support by April 2024.

The organisations are also warning that, despite a recent price fall, millions of customers will still face a struggle to afford their energy bills this winter (see below) which are projected to be at least £600 higher than they were at the start of last year. The accumulated effect from an extended period of high energy bills and other cost-of-living challenges means that many customers risk falling further into debt, even as prices stabilise. They are calling for any support package to be targeted, funded fairly and to work with existing measures such as the Warm Home Discount.

In addition, it is being stressed that targeted help – as opposed to the universal support provided last winter by the Energy Bill Support Scheme and the Energy Price Guarantee – will require more time to introduce and for the Government to address this issue now, rather than waiting until the autumn.

Dhara Vyas, Energy UK’s deputy chief executive said:

“Energy suppliers, consumer groups and charities are all concerned that millions of households  are still going to need help to pay for the energy they will need to use  this winter. The Government stepped up last year  with support that was a lifeline for many customers but introducing it at very short notice necessitated a blanket approach. This would be hugely expensive to repeat. Planning targeted support for those who need it the most cannot wait until winter is nearly upon us. A more permanent, long-term solution to ensure all customers can afford their bills is also required – and if that means putting in place a social tariff by next April, then time is already running very short.”

Citizens Advice reports that the average spend on gas and electricity for the people they help with debt advice has gone up by 73% since 2019 — from £112 per month to £194 – the equivalent of 13% of their income.

Citizens Advice calculates that providing targeted energy bill support for the average debt client could help them end each month with £13.18 to spare, instead of £23.40 out of pocket – a difference of £438.96 over 12 months. For those who are struggling more, the gain from targeted support would be even higher.

Dame Clare Moriarty, chief executive of Citizens Advice, said:

“Energy affordability is a long-term problem that needs a long-term solution. A social tariff would protect millions of people from spending excessive amounts on their bills.

“High energy costs have left too many people choosing between heating and eating. Uncertainty over future high prices only adds to the stress and worry felt in households across the country.

“This policy helps make energy bills more affordable in the years ahead and supports the shift to warmer, safer homes that are ready for the net zero transition.”

National Energy Action warned last month that the removal of the Government’s previous support had left 6.6 million households in fuel poverty and earlier this year was one of 95 charities and non-profit organisations calling for the introduction of a social tariff.

Adam Scorer, chief executive of National Energy Action (NEA) said:

“Last winter was bleak but this winter is set to be even worse. Our figures show 6.6 million UK households are in fuel poverty – an increase of over 2.5 million since the energy crisis began. That’s millions more people going without hot food, warm showers and rationing their heating or turning it off altogether. A social tariff for the most vulnerable is vital to help those who cannot stay warm, safe and healthy at home.”

Maria Booker, head of policy at Fair By Design, said:

“Energy is an essential service that needs to be affordable to all. With energy prices predicted to remain high into the next decade, the Government urgently needs to put in place long term and targeted support so that everyone can afford to keep warm and safe.

“A social tariff would benefit those most in need and stop the poorest from paying more. We urge Government not to delay the consultation any further and lay out its plans to help the poorest households afford the energy they need.”

Katie Watts, head of campaigns at MoneySavingExpert, said:

“Even with the recent drop in the Energy Price Cap, the stark fact remains that people are still paying double or more what they did before the energy crisis hit in October 2021. We’ve heard from many MSE users who are desperate and trying to cut back on costs as much as they can – and yet they’re still facing unaffordable bills.

“It’s vital that the Government delivers on its commitment to come up with more targeted support for both this winter and for the future.”