Memorandum submitted by the Energy Saving
Trust (FP 32)
This is the submission of the Energy Saving
Trust to the Energy and Climate Change Committee's call for written
evidence on fuel poverty.
The Energy Saving Trust is the UK's leading
organisation working towards reducing emissions from households,
communities and transport. Established since 1992, we are one
of the key delivery agents for the Government's climate change
objectives.
We welcome the opportunity to respond to this
consultation on a subject which is becoming an increasingly important
aspect of our work. Key issues addressed in our submission include:
— The potential for different support services
to be more `joined up' in order to reduce consumer confusion and
improve access to support for vulnerable customers.
— The important role of area based approaches.
— The need for improvements in energy efficiency
in the private rented sector.
— The potential for better use of data
to help target households at risk of fuel poverty.
— The potential for renewables and solid
wall insulation to tackle fuel poverty in off grid properties.
If you have any queries or would like to discuss
these issues in more detail please do not hesitate to get in touch.
1. IMPROVING
INTEGRATION OF
SUPPORT SERVICES
1.1 There are a large number of different
support and advice services focussing on the key determinants
of fuel poverty: energy efficiency, energy tariffs and income
maximisation. These services are provided by a host of organisations
including local authorities, energy suppliers, local and national
charities and government bodies.[86]
This can be confusing and impair access to support, especially
for vulnerable consumers who may need greater assistance in accessing
services.
1.2 Our advice services have a diverse customer
base with users coming come from a wide range of financial and
social circumstances. A high proportion of our telephone advice
customers tend belong to be older age groups. We are conscious
of the significant increase in fuel prices experienced over the
last few years and the likely future trajectory for energy prices.[87]
We are also aware that there are now over 5 million households
in the UK in fuel poverty.[88]
It is therefore unsurprising that our advisors receive a number
of calls from people expressing concern about paying their bills.
We are currently developing our advice services to support those
customers concerned about paying their energy bills and those
at risk of fuel poverty. This involves our advisors providing
basic information on how to save money through changing energy
tariffs, altering payment methods or switching suppliers and how
to maximise incomes, as well as referring callers to sources of
in-depth specialist support and advice. We are also strengthening
and developing our referral systems to Warm Front (and the Home
Energy Efficiency Scheme in Wales) and energy supplier CERT schemes
to ensure customers access available support as quickly as possible
and that they receive the best possible quality of service.
1.3 The current wide range of support services
inevitably relies on the customer having to make multiple follow
on calls. This is likely to lead to high levels of drop-out and
vulnerable customers not accessing the support they require. In
future, it may be possible to improve linkages between support
services and to create a more integrated customer journey.
1.4 The Energy Assistance Package in Scotland
provides a model of how a more integrated approach to energy efficiency
and fuel poverty services could be developed (see annex 1 for
summary of how the scheme works). The scheme utilises the expertise
provided by existing services but provides a single point of access
for the consumer. The "journey" is managed on behalf
of the customer so the service does not rely on them making multiple
follow-up calls. From the initial point of contact their needs
would be identified enabling other advice services to be provided
to them proactively. For example, advice on tariffs or benefit
entitlement is given through a follow up call at the most convenient
time for the customer. Additionally, by integrating services for
non fuel poor customers at the same time, the likelihood of services
becoming stigmatised and this becoming a barrier to vulnerable
households accessing support is reduced. The end of the current
Warm Front scheme in 2011 could offer an opportunity to improve
integration of services. In Wales, the Welsh Assembly Government
is considering the possibility of a similar approach following
the conclusion of the Housing Energy Efficiency Scheme.
1.5 This approach also allows for closer
monitoring of service standards and customer satisfaction rates
and for tough quality assurance processes to be developed. Centrally
managing and monitoring the customer experience also makes it
easier to track consumer needs and identify problems or gaps in
services provision and for improvements to be made.
2. IMPROVING
ACCESS FOR
VULNERABLE CUSTOMERS
2.1 Better integration of energy efficiency
services with specialised fuel poverty services can in itself
help increase access to services. The development of a single
point of contact can also prevent fuel poverty services from becoming
stigmatised and vulnerable consumers being reluctant to use them.
2.2 Any effective fuel poverty support service
must work closely with local authorities and social housing providers
to ensure that it is well integrated with local services and initiatives,
and to ensure that vulnerable consumers are referred into the
scheme.
2.3 For support services to be accessed
by the most vulnerable it is essential that they work closely
with trusted community and voluntary sector organisations.[89]
This should include community groups, tenant organisations, social
care services, health centres and others. The Scottish Power Energy
People Trust[90]
is often singled out as an example of best practice in supporting
local voluntary and community initiatives working with supporting
fuel poor households. Similarly, this is a key part of the new
Energy Assistance Package in Scotland where community liaison
officers are tasked with developing partnerships and working closely
with community groups, local charities and health centres. Partnerships
with national membership organisations and charities, such as
Age Concern and Help the Aged, are also key to spreading awareness
and supporting "hard to reach" vulnerable consumers.
Such activity is time intensive and must be adequately resourced.
3. AREA BASED
APPROACHES AND
LOCAL PROGRAMMES
3.1 Area based initiatives with intensive,
well delivered door to door promotion of services, can help increase
local consumer awareness and demand for energy efficiency measures
and ensure that the most vulnerable households within an area
receive support. Focussing such activity in areas of deprivation,
as has been done with Warm Zones and is now being delivered through
CESP, can maximise the benefits for vulnerable households.
3.2 It is inevitable that individual households
outside of these target areas need support. As we begin to move
focus towards more expensive and disruptive energy efficiency
and microgeneration measures, the use of various natural "trigger
points" will be key to minimising costs and disruption. This
suggests it will be important to maintain national level provision
of support services to support households when most appropriate,
for example when undertaking decorations or renovations.
3.3 It will be important for the national
support schemes and the more local area-based initiatives to be
well integrated. We believe it is important that the increase
in area-based approaches does not lead to greater fragmentation,
duplication of services and customer confusion. Area-based initiatives
run by local authorities and other organisations should take advantage
of the national services available and refer consumers to these
services where appropriate. Equally, any national service should
be aware of what local schemes are in place so it can refer consumers
in to these schemes if appropriate. Ideally, both national and
local schemes should mutually support and reinforce each other
by channelling consumers towards the most appropriate support
services for their circumstances.
3.4 Local authorities have a key role to
play in the coordination and delivery of energy efficiency and
renewable energy programmes. However, to date performance in this
field has been patchy. While there are a small group of local
authorities moving ahead quickly, many are lagging behind and
do not have the level of experience and expertise required to
take on such new roles. It is therefore vital that local authorities
are appropriately incentivised to act and furthermore are given
the support they need to develop their capabilities.
3.5 The Energy Saving Trust currently provides
in-depth strategic support to over 110 local authorities through
our one-to-one support programme, while our free Practical Help
support line is used by over 90% of local authorities.[91]
4. THE PRIVATE
RENTED SECTOR
4.1 There are a much higher proportion of
highly inefficient homes in the private rented sector than in
other tenures: the stock is much older on average and "G-rated"
homes are nearly twice as prevalent in this sector as in other
tenures. As a result tenants in the private rented sector are
disproportionately likely to be living in cold homes.
4.2 Private landlords must be incentivised
to undertake energy efficiency improvements. This could be achieved
through an increase in scale and scope of the Landlords' Energy
Saving Allowance (LESA). This allowance also needs to be properly
promoted by government—action to tell landlords and their
agents about LESA has been minimal. We also need to maximise the
impact of Energy Performance Certificates (EPCs) in this sector.
Tenants should be encouraged to use EPCs when they look for a
home: some evidence suggests that tenants (perhaps more than home
buyers) are interested in and responsive to EPC information about
energy bill costs. We need to make sure that landlords are providing
EPCs. Anecdotal evidence suggests there may be weaknesses in enforcement
of EPC requirements. Additionally, there are no obligations to
provide EPC information in web-based marketing of properties.
4.3 While we can take action to stimulate
voluntary action on energy efficiency in the PRS, due to the problem
of the split incentive (whereby the landlord pays for energy saving
improvements, but the tenant benefits from lower fuel bills) legislation
may be required in this sector. Over time, minimum standards for
rented homes should be outlined which give a clear signal to landlords
of what standards will be expected along with an adequate lead-in
time and sign-posting to sources of support such as CERT and LESA.
More immediately, local authorities could make much greater use
of environmental health regulation, which should be used to tackle
homes which are too expensive to heat. The Housing Health and
Safety Rating System—the assessment tool used by environmental
health officers—should clearly identify dangerously cold
homes as those with a SAP rating of 39 or less (EPC rating F and
G). There are approximately 700,000 F and G rated privately rented
properties in England.
5. FOCUSSING
ON THE
LEAST EFFICIENT
HOMES
5.1 There is a strong relationship between
instances and the severity of fuel poverty and poor energy efficiency.
The Fuel Poverty Advisory Group estimates that in 2006 45% of
households in fuel poverty occupied properties with SAP ratings
between 0 and 40. However, 18% of recipients of Warm Front support
already had a SAP rating of 65.[92]
Better targeting of support towards the most inefficient properties
could help improve the level of impact. This could be achieved
by prioritising support to those properties below a certain SAP
level.
5.2 There are approximately 5 million properties
with a SAP of 39 or less (F and G rated) in England. Recent analysis
we have undertaken shows that significant improvements could be
made to these properties at relatively low cost. 81% of F and
G rated properties could be moved to a band E level for a cost
of less than £3,000 and 37% at a cost of less than £1000.
Moving all these properties up to an E rating would save approximately
9.4MtCO2 per year.
6. BETTER USE
OF DATA
6.1 The Energy Saving Trust's Homes Energy
Efficiency Database[93]
(HEED) is the main national resource on the energy efficiency
of the housing stock. It brings together information from CERT
(and its predecessors), fuel poverty schemes and other programmes,
and provides information on almost half of the housing stock.
We have developed a means of identifying areas with high concentrations
of CERT priority group and unfilled cavities by integrating aggregated
benefits and age data from the Department for Work and Pensions.
Through the inclusion of additional benefit data at a finer geographical
resolution this approach could be developed to improve targeting
and to monitor the effectiveness of energy efficiency and fuel
poverty support schemes. Additionally, we are running a pilot
project integrating meter point gas and electricity consumption
data which could be used to monitor and evaluate schemes.
6.2 Inclusion of EPC data within HEED would
help to further strengthen the tool by increasing its coverage
and, crucially, providing a more robust sample of properties within
a given area. Over time, as EPCs begin to filter across the housing
stock, their inclusion in HEED could allow very effective targeting
policies and programmes towards areas with the most inefficient
housing stock. These areas are also likely to have the highest
levels of fuel poverty, particularly where they correspond with
areas of low incomes. The Energy Saving Trust does not currently
have access to EPC data for England and Wales for HEED. This is
in contrast to the situation in Scotland where the Energy Saving
Trust administers EPCs on behalf of the Scottish Government and
has full access to the data for the purposes of research and home
energy efficiency programmes.
7. OFF GRID
PROPERTIES
7.1 Renewable technologies such as heat
pumps can offer effective solutions to those at risk of fuel poverty
off the gas grid and can offer significant advantages in terms
of running costs and carbon emissions, over LPG or oil boilers.
This was demonstrated by the recent two year Scottish Renewables
Heating Pilot.[94]
The experience of the trial underlines the importance of robust
assessments of what technologies may be most appropriate for different
circumstances and the need for advice on how to use the technology
accompanying the installation. The trials of renewables underway
as part of Warm Front should also provide important insights.
7.2 Consumer preferences and acceptance
of technology options are important considerations. However, a
balance is required to ensure that lack of consumer familiarity
with new technologies does not block the use of the most appropriate
technologies for their circumstances and lead to sub-optimal solutions
being installed. In future, fuel poverty support programmes need
to carefully assess the way in which choices over technologies
are presented to off grid consumers and the overall level of choice
given to households.
7.3 Support to off grid properties should
follow the principles of the energy "hierarchy" by first
always reducing consumption requirements through energy efficiency
measures.
7.4 Providing solid wall insulation to households
at risk of fuel poverty, has the potential to support many consumers
who do not benefit from current schemes, including many off grid
properties. Around 7 million properties in the UK have solid walls.[95]
Evaluation of CESP projects should offer important lessons in
the implementation of solid wall insulation in vulnerable households.
Beyond that, there is a need for new policies to rapidly increase
the rate of installation of solid wall insulation. This will be
essential to achieving our carbon targets and cutting the level
and severity of fuel poverty.
February 2010
Annex 1
SUMMARY OF SCOTTISH ENERGY ASSISTANCE PACKAGE
OVERVIEW
The Energy Assistance Package is a holistic
package to help maximise incomes, reduce fuel bills and improve
the energy efficiency of homes. It replaced the Central Heating
and Warm Deal programmes from April 2009.
The new package provides a more holistic and
integrated approach to tackling fuel poverty by bringing together
the hard measures and the advice, reaching more people and providing
a wider range of support. The package was a recommendation of
the independently chaired Scottish Fuel Poverty Forum as necessary
in order to eradicate fuel poverty.
The package has four stages:
Stage 1: offers free expert energy
advice to anyone who phones the Energy Savings Scotland Advice
Centre (ESSAC) network on 0800 512 012.
Stage 2: benefit/tax credit checks
& advice on social tariffs to those at risk of fuel poverty.
Stage 3: provides a package of standard
insulation measures (cavity wall and loft insulation) to older
households and those on one of a range of benefits through the
energy companies' CERT schemes.
Stage 4: bespoke energy efficiency
measures (including but not limited to central heating systems,
new boilers, draught proofing, air source heat pumps and solid
wall insulation) for eligible groups who live in homes in the
private sector with poor energy efficiency (SAP < 54).
Full eligibility criteria can be found at: http://www.scotland.gov.uk/Topics/Built-Environment/Housing/access/FP/eap
DELIVERY
The Energy Saving Trust is responsible for developing,
marketing and administering the scheme. Delivery will be through
the existing network of Energy Saving Scotland advice centres
(ESSacs) which the Trust manages on behalf of the Scottish Government.
Five centres exist across Scotland: Highlands and Islands; South
West; South East; North East; and Strathclyde and Central.
The EST role will be to manage the customer
journey; various third parties will deliver some of the different
EAP measures following referrals from the EST. These are as follows:
Stage 1: Energy advice is delivered
via the ESSacs.
Stage 2: Social tariff advice is delivered
via the ESSacs working with the energy companies. Benefit and
tax credit checks are delivered by the Pensions Agency (over 60s)
and CAB Direct (under 60s).
Stage 3: CERT measures are delivered
by suppliers.
Stage 4: Installations will be carried
out by Scottish Gas as managing agent for 2009-10.
86 http://www.eeph.org.uk/uploads/documents/partnership/EEPH%20Briefing%20Paper%20revised%2025-02-2009.pdf Back
87
http://www.ofgem.gov.uk/markets/whlmkts/discovery/documents1/discovery_scenarios_condoc_final.pdf Back
88
UK Fuel Poverty Strategy: 7th annual progress report http://www.decc.gov.uk/en/content/cms/what_we_do/consumers/fuel_poverty/strategy/strategy.aspx Back
89
For example see: CSE (2006) Integrating Welfare Rights and Fuel
Poverty Services, for the Energy Efficiency Partnership for Homes,
http://www.cse.org.uk/pdf/pub1058.pdf Back
90
http://www.energypeopletrust.co.uk/ Back
91
The Energy Saving Trust has recently begun developing specialist
local authority advice services specifically on area-based approaches,
see http://www.energysavingtrust.org.uk/business/Business/Local-Authorities/Area-Based-Approaches-Best-Practice-Guide Back
92
National Audit Office (2009) http://www.nao.org.uk/publications/0809/the_warm_front_scheme.aspx Back
93
http://www.energysavingtrust.org.uk/uploads/documents/housingbuildings/heed_bn%20April08.pdf Back
94
See http://www.scotland.gov.uk/Publications/2008/11/17115604/0
and http://www.energysavingtrust.org.uk/corporate/Corporate-and-media-site/Media-centre/Hot-topics/The-role-of-renewable-heating-in-tackling-fuel-poverty-in-Scotland Back
95
For more information please see Energy Saving Trust (2008) Energy
Efficiency in Hard to Treat Homes http://www.energysavingtrust.org.uk/uploads/documents/housingbuildings/14_htth_s.pdf Back
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