Energy prices and fuel poverty set to soar

Ofgem has confirmed a staggering 80% rise on the energy price cap from 1 October 2022, meaning that in just one year, average household energy bills have lurched from £1277 in October 2021, to an excruciating £3,549. It’s now estimated that half of all households in England, Scotland and Wales will fall into fuel poverty after the October energy price hikes.

The energy price cap was introduced in 2019 to set the top figure that those on dual-fuel rates could be charged for typical yearly usage of gas and electricity. The increase comes in the wake of record gas energy market prices, caused by the global supply crisis and the war in Ukraine. Back in May, the Government stepped in with a £15bn package of measures, including a £400 grant for all households, and additional help for the most vulnerable. However, these measures were introduced when the October price cap was estimated to rise to £2800. The real costs are far in excess, with average households facing an additional £1578 to pay. The promised measures are just a drop in the ocean when it comes to the wider cost of living crisis. Frustratingly, news of additional help from the Government is on hold until a new Prime Minister is in place.

Kevin Wellman, CEO of the Chartered Institute of Plumbing and Heating Engineering (CIPHE) said, “We are entering into an energy disaster. With the impact felt by households, businesses and organisations across the UK. The government help committed to date is not going far enough to protect the most vulnerable, who will have to choose between heating and eating this winter. Last October it would have been unfathomable that half of UK households would be facing fuel poverty this autumn. From middle-income families to pensioners, there’s a real fear of what lies ahead.”

Currently, more people die each year from cold homes than from alcohol, Parkinson’s Disease or traffic accidents. Figures show ill health due to fuel poverty costs the NHS £3.6 million every day. With both figures set to rise, Kevin is understandably concerned. “There is no doubt that fuel poverty has a detrimental effect on people’s physical health. Living in a cold home increases the risk of serious illness and even death, particularly among the vulnerable. Sadly, the impact on mental health and wellbeing is less understood.

“The CIPHE also holds grave concerns around the health and safety implications of poorly maintained gas appliances. Households unable to pay bills are unlikely to afford yearly servicing and gas safety checks. In the case of a breakdown, consumers may be tempted to go for a low quote from an unregistered installer, or try to fix boilers themselves. With the recent spate of fatal domestic gas explosions, we need to ensure the gas safety message rings clear, even in the harshest of financial circumstances.

“As outlined in our manifesto, the government has to take serious steps to make homes, heating and hot water systems as efficient as possible to help pull people out of fuel poverty. Additionally, it’s clear people need a short-term sticking plaster to get through this winter. It is imperative further financial aid is given to all those struggling with their bills. We also must not forget that business, industry and public services such as schools will be hit hard with the cost of fuel and inflation too. From households to healthcare, there will be difficult decisions made regarding the cost of heat, light and appliances this winter.

“The CIPHE cannot emphasise more the vital role installers play in helping their customers get the best efficiencies out of their heating and plumbing systems. From ensuring boiler settings aid efficient use, to upgrading controls, or fixing dripping taps, saving water and energy is all in a day’s work. Remember that education costs nothing, and a five minute chat about saving energy and water efficiency, could help save hundreds on bills.”

You can find energy and water saving tips for your clients on the CIPHE website at www.ciphe.org.uk/utility-bills