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Ending cold homes

Consumer Futures commissioned ACE Research to model the cost and impact of introducing ambitious new fuel poverty targets. This new report presents the results of the research, as introduced by William Baker, Head of Fuel Poverty Policy at Consumer Futures, below.

Consumer Futures has long advocated an ambitious strategy to address the fuel poverty crisis in England. We consider a national programme to install extensive insulation and efficient heating systems in the homes of low income consumers would make a major contribution towards eliminating fuel poverty, although complementary income and fuel price measures are also required.

The UK Government’s proposal to develop a new Fuel Poverty Strategy for England provides an important opportunity to introduce the programme we advocate. Forthcoming secondary legislation will introduce new fuel poverty targets as a central component of the new Strategy. We consider such targets should be based on minimum energy efficiency standards set initially to eliminate cold homes and in the longer term to provide affordable warmth for all low income households. Consumer Futures considers the following fuel poverty targets would meet our goals:

  1. Improve the homes of low income households in 2015 to a minimum Energy Performance Certificate (EPC) rating of D by 2020. EPC D is currently the average energy efficiency rating of the English housing stock.
  2. Improve the homes of low income households to a minimum EPC rating of C by 2025.
  3. Improve the homes of low income households to a minimum EPC rating of B by 2030. Band B broadly corresponds to current new-build standards and is widely considered sufficiently high to ‘fuel poverty proof’ homes for the vast majority of occupants.

We consider the targets should apply to all low income households, rather than ‘fuel poor’ households alone. This is because many low income households not defined as ‘fuel poor’ could benefit from cost effective improvements to their homes and thus enjoy more affordable fuel bills. Having selected our preferred fuel poverty targets, we wanted to establish their detailed costs and benefits. We therefore commissioned the ACE Research to model the impact of the targets, should the UK Government adopt them. We wanted the research to provide the following information:

  • The impact of meeting the targets on fuel poverty
  • The impact of meeting the targets on occupants’ fuel bills
  • The total cost and average cost per household of meeting the three targets. We consider low income households, unlike better off households, cannot be expected to meet these costs themselves.
  • The characteristics of the housing stock occupied by low income households which would be targeted for help.

Consumer Futures believes the research shows that the Energy Performance Certificate (EPC) D and C targets are realistic and achievable, given sufficient political will. The EPC B target is going to be harder and will require further developments in technology for some types of property. Nevertheless, we consider the Government should aspire to meeting this target, particularly given that it is still nearly 17 years away. We urge the UK Government to examine this report in detail and take on board the evidence presented. We look forward to the Government proposing our targets in its forthcoming consultation on the new Fuel Poverty Strategy.

William Baker, Head of Fuel Poverty Policy, Consumer Futures

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