Fuel poverty

A household is said to be in fuel poverty when its members cannot afford to keep adequately warm at reasonable cost, given their income. The term is mainly used in the UK, Ireland and New Zealand, although discussions on fuel poverty are increasing across Europe,^[1] and the concept also applies everywhere in the world where poverty may be present.

Definitions

In the UK fuel poverty is defined by the Warm Homes and Energy Conservation Act as: “a person is to be regarded as living “in fuel poverty” if he is a member of a household living on a lower income in a home which cannot be kept warm at reasonable cost”. ^[2] Statistically this used to be defined when a household would need to spend more than 10% of its income to maintain an adequate heating regime (definitions of "income" and "adequate heating regime" vary between UK Government and Devolved Administrations.)^[3] A new more complex definition of fuel poverty is now used in the UK, based on the Hills review. ^[4] This gave the following definition; fuel poverty is now defined as when a household’s required fuel costs are above the median level; and if they were to spend what is required, then the household would be left with a residual income below the official poverty line. Additionally, a Fuel Poverty Indicator has been created, which shows how far into fuel poverty households are, not simply if they are in poverty or not. ^[5]

In Eastern Europe (transition economies) the term energy poverty is sometimes used instead.^[6] However this use of the term (which is about a lack of access to energy services due to economic poverty) can be confused with indicating a lack of any access to energy infrastructure, as has been used by the World Economic Forum when establishing its Energy Poverty Action (EPA) initiative in 2005 to address energy poverty in the developing world by implementing electrification schemes (grid-extension and off-grid).^[7]

Causes of fuel poverty

Fuel poverty is caused by a convergence of four factors:

• low income, which is often linked to absolute poverty
• high fuel prices, including the use of relatively expensive fuel sources (such as electricity in the UK, aggravated by higher tariffs for low-volume energy users)
• poor energy efficiency of a home, e.g. through low levels of insulation and old or inefficient heating systems
• under-occupancy: according to UK government statistics, on average those in the most extreme fuel poverty live in larger than average homes
• old age.

The sharp rise in fuel prices from 2006-8 has led to an estimated doubling of the numbers in fuel poverty in countries where it is a major problem.^{[citation needed]}

A number of illnesses, including cancer can exacerbate the problems associated with fuel poverty.^[8]

United Kingdom

In early 2008 it was estimated by Energywatch that there were around 4.4 million households in fuel poverty in the UK, with just over 3 million in England alone: this was more than double the number in 2003.^[9]

By April 2011 a YouGov survey indicated that the number of households in fuel poverty had risen to 6.3 million households, representing approximately 24% of all households in the UK.^[10]

Research by Confused.com found that 82% of the UK population had expressed a concern at being able to afford their energy bills throughout winter.^[11]

See also

• National Energy Action (NEA)

References