Source · Select Committees · Energy Security and Net Zero Committee
Recommendation 4
4
Acknowledged
Paragraph: 24
Implement a social tariff and efficiency measures for vulnerable households, streamlining existing schemes.
Recommendation
We urge the Government and energy suppliers to consider implementing a form of social tariff and other measures to protect vulnerable households from being cut off from their energy supplies. We note the challenges vulnerable households can face in benefiting from the energy savings that more energy efficient homes and appliances can bring. We recommend that such a social tariff should also be accompanied with measures that enable energy efficiency improvements. In the longer term, the Government should streamline the various existing schemes into a more targeted form of support for the most vulnerable, especially over the winter months.
Government Response Summary
The government stated it is exploring options for consumer protection and that there is no consensus on what a social tariff entails. It highlighted existing cost-of-living payments and energy efficiency schemes, and committed to a consultation on the Fuel Poverty Strategy for England in early 2024.
Paragraph Reference:
24
Government Response
Acknowledged
HM Government
Acknowledged
The department engages with a range of stakeholders and is continuing to explore options for the best approach to consumer protection, as part of wider retail market reforms. The Government acted swiftly to provide support to UK households and delivered almost £40 billion of energy bills support through different schemes from October 2022 to March 2023. This experience in delivering household support and the valuable lessons learned are now underpinning Government planning on a range of scenarios for this coming 2022–23 winter and beyond. There is no clear consensus on what a social tariff is, but it is broadly agreed to mean providing financial support to those who struggle to afford their energy bills. The Government is approaching this in three ways. • Firstly, for those struggling with cost of living in general, the Government has provided up to £900 this year through Cost-of-Living Payments. • Secondly, for those who face challenges particularly linked to energy, for example because they live in a poorly insulated home, the Government has provided targeted support such as the Warm Home Discount scheme, which has increased in value and expanded to provide £150 rebates to around 3 million households. The Government is also exploring how we can make the scheme more flexible. Meanwhile, the Winter Fuel Payment provides between £250 - £600 and the Cold Weather Payment provides £25 during very cold weather. • Lastly, for those who are facing high levels of debt or other issues linked to their energy bills, the Government is working closely with Ofgem and suppliers on the best way to support those customers. There are also a range of targeted schemes in place to deliver energy efficiency measures to low income and fuel poor households. Schemes include the Energy Company Obligation (ECO), the Social Housing Decarbonisation Fund (SHDF) and the Home Upgrade Grant (HUG). In total, we have allocated around £20 billion to clean heat and energy efficiency over this Parliament and the next. These forms of energy support play an important role in safeguarding the most vulnerable with their winter energy costs. Government agrees that energy efficiency is also a crucial part in tackling fuel poverty and further supporting vulnerable consumers alongside contributing to reducing energy bills and carbon emissions in line with net zero. The Government is reviewing the Fuel Poverty Strategy for England and intends to publish a consultation in early 2024 and continues to monitor the situation and keep options under review.