Government committee push for more use of EPCs
The Committee on Fuel Poverty (CFP), an advisory Non-Departmental Public Body sponsored by the Department for Business, Energy & Industrial Strategy (BEIS), monitors Government’s progress on their 2015 fuel poverty strategy for England and provide independent, expert advice to ensure that the milestones and targets are met. Their 2018 annual report reports progress and sets out recommendations for Government action, most of which stems around the better use of EPCs.
The Government’s fuel poverty strategy includes a statutory fuel poverty target for ‘as many fuel poor households as reasonably practicable to achieve a minimum energy efficiency rating of a Band C by 2030.’ It also has two interim milestones of Band E by 2020 and Band D by 2025. This phased approach follows the principle of prioritising assistance to those in the deepest levels of fuel poverty - ‘worst first’.
The report shows that overall progress is stalling whilst the aggregate Fuel Poverty Gap (ie the reduction in required spending which would take a household out of fuel poverty) is down by 7% and the average gap has reduced to £326/ year. The total number of households in fuel poverty is up by 210,000 to 2.55 million and progress on upgrading the energy efficiency levels of fuel poor homes is 2% to 6% lower than previously forecast. As a result the committee is estimating that the funding needed to complete the strategy has therefore grown from £15.4 billion in the 2017 Annual Report to £17.1 billion.
To reverse this trend the committee has made 19 recommendations, 9 of which relate directly or indirectly to EPCs:
1: Treasury should allocate £1 billion funding to a new ‘Clean Growth Challenge Fund’ for 2019-2021.
2: Maximum use of the 25% Flex scheme in ECO3 should be made to reach fuel poor households living in Band F and G properties and the fuel poor who are not claiming means tested benefits. Flex performance in these areas should be carefully monitored and, where necessary, new guidance should be issued to ensure improved targeting, especially of households who are not in receipt of benefits.
3: Enforcement of health, wellbeing, energy efficiency and safety-related regulations in the privately rented sector should be significantly enhanced and private landlords should be incentivised to invest in the necessary measures.
4: The Landlord’s Energy Savings Allowance – a former tax allowance on energy saving expenditure by landlords – is re-introduced.
5: The HHSRS guideline scores for the health and safety impact of cold homes on children and pensioners are reviewed (and updated if necessary) in light of the latest studies on health effects from cold homes. Recommendations to help deliver the 2025 milestone and 2030 target
6: The Winter Fuel Payment programme is focused on helping those households in all age groups who are most in need to pay their energy bills and that the resultant surplus funds are used in new programmes to install energy efficiency measures in fuel poor homes
7: The Clean Growth Strategy proposal for continuing a home energy efficiency programme is focused on fuel poor households and that Government considers the most appropriate mechanism for maximising progress towards the 2025 Milestone and 2030 target
8: The PRS regulations are extended to include achieving Band D in 2025 and Band C in 2030 and that the cap on landlords’ expenditure is reviewed and increased to achieve the target.
9: Government acts on the National Infrastructure Commission’s recommendation to improve Social Housing energy efficiency to Band C by 2030 through introducing new targets and incentives for social landlords to make improvements as part of their business plans.
10: To deliver the 2025 Band D milestone, Treasury should allocate £1.8 billion funding to continue the new ‘Clean Growth Challenge Fund’ for 2022-2025
11: Government should continue to identify innovative ways to achieve Band C at lower costs. Committee on Fuel Poverty Annual Report 2018 37 Assisting fuel poor households to pay energy bills
12: Until the WFP programme is significantly better targeted at assisting all households in fuel poverty, BEIS should work with other stake holders to take the necessary steps to ensure that households in fuel poverty receive at least the equivalent levels of assistance to pay their fuel bills as pensioners.
13: We continue to recommend that Government improves WHD so that it better targets fuel poor households, and:
- the participation threshold for energy suppliers be lowered to those with more than 50,000 customer accounts
- park home residents should be made aware of support available through the industry initiatives part of WHD Developing tools to improve the targeting accuracy and efficiency of assistance to fuel poor households
14: We strongly recommend that BEIS identifies how the Data Sharing legislation and proxies can be used to better target assistance to fuel poor households who are not in receipt of benefits. We accept however that due to incomplete data sets, it will not be possible to use Government data to identify all fuel poor households.
15: We recommend that local community groups and charities are supported in their efforts to provide detailed, personal and relevant energy advice on behaviour changes, potential energy efficiency improvements and access to support from energy companies or their agents.
16: We recommended that benefits advice and support is included in future fuel poverty programmes.
17: High priority is given to the BEIS work to model the reduction in health and social costs that could result from enhancing the energy efficiency of fuel poor homes. Once agreement to a model is obtained across Government departments, the NHS, Public Health England and DHSC, the financial value of health benefits should be taken into account for programmes that assist householders to pay their energy bills or that enhance the energy efficiency of their homes.
18: We recommend that BEIS carries out detailed analysis on the issue of churn in and out of fuel poverty, to validate their contention that the best way to address churn is to open ECO3 eligibility to all low income and vulnerable households, rather than those most in need.
19: Ofgem and BEIS should gather quantitative data on how market interventions and new technology will financially benefit or disadvantage households in fuel poverty so that the resultant impact on fuel poverty can be calculated.