Energy crisis exposes struggles of UK households
In the aftermath of the pandemic and amidst a cost-of-living crisis, energy advice service providers like the Centre for Sustainable Energy (CSE) are operating in a rapidly changing environment.
To address the pressing needs of struggling households, a key focus has been on emergency support including quick-win fuel vouchers and emergency hardship funds. Key referral partners, such as foodbanks, have become crucial in many areas, bridging the gap for those facing energy-related challenges.
At CSE, we wanted to know more about the lived experiences of people who’d received emergency financial support in winter 2022-23. This included fuel and fuel vouchers, Surviving Winter Grants, and other support, for example with white goods.
No funding for detailed evaluation
In our experience, funders of advice don’t typically provide a budget for detailed evaluation of service delivery. It’s often challenging for us to get rich data on the experience of the people we support. We therefore used some of our own charitable reserves to self-fund this work exploring questions including:
- Are prepayment meter customers struggling more than last year?
- Are people on Economy 7 struggling more than last year?
Overall, we found that things are significantly worse for most people this year. The majority of both prepayment meter and Economy 7 customers agreed their physical or mental health had become worse due to living in a cold home, reported increased anxiety about fuel bills and were more likely to access food banks and other support.
We’re hoping we can do more evaluation work like this to better understand other aspects of the energy market. We are really keen to contact some of our clients using smart meters who currently can’t access prepayment meter vouchers (because they won’t work on smart pre pay). We’ve heard shocking stories about smart meter households being automatically switched to pre pay which has really undermined consumer confidence.
Read the full report here
We cannot afford our energy bills. There is nothing left to cut back on. We only heat one room, with a small log burner which is only lit at dusk for a few hours even at -10°. We use blankets and hot water bottles to try to keep warm.Wendy, Wiltshire, C band property
The survey data provided a comprehensive snapshot of the energy crisis experienced by households during winter 2022-23. Prepayment meter customers, in particular, reported significant struggles. Compared to the previous year, three-quarters of prepayment meter customers strongly agreed that their physical or mental health had deteriorated due to living in a cold home.
Additionally, 88% expressed heightened anxiety about their fuel bills. The impact on prepayment meter customers was significantly higher compared to non-prepayment customers in both aspects.
Furthermore, prepayment meter customers were more likely to rely on foodbanks, with a 22% difference compared to non-prepayment meter customers. They also reported higher monthly fuel bill expenditures in the ranges of £150-199 and £200+, suggesting increased financial strain.
Similar trends were observed among Economy 7 customers, who reported higher monthly costs compared to those on single rate tariffs. These households also exhibited a higher likelihood of accessing food banks and other support services.
We live in an old, thatched cottage, we have single glazing and no central heating. We would like to use a heater but can’t due to costs. Night time is awful to begin with as mum has to use a load of blankets with a warm duvet and a hot water bottle – she is 78!Mark Somerset, no EPC
Lived experiences of households receiving financial support
The qualitative data gathered in the survey shed light on the human impact of the energy crisis. Most respondents strongly agreed that they found it increasingly difficult to keep their homes warm, were forced to ration energy, and experienced heightened anxiety about fuel bills. The physical and mental health of these households suffered as a direct consequence of living in cold homes.
The survey results raise critical questions that warrant further investigation:
- What factors contribute to prepayment meter customers’ significantly higher spend on fuel bills, even when residing in energy-efficient homes? Is it influenced by energy unit and standing charge prices, behavioural patterns, occupancy, technology, or other factors?
- What proportion of households residing in EPC A-C band properties, after meeting the necessary heating costs, have a residual income below the official poverty line? This would indicate ‘hidden’ households which are in poverty due to fuel costs but are not identified as fuel poor under the LILEE definition. These households may have been included as fuel poor under previous definitions: Low Income High Cost and ‘10% income spend’.
We’re keen to do much more evaluation. More information can shape insights into what changes Ofgem could make to support these customers in better and more meaningful ways.
Mould and cold has increased illnesses. If it wasn’t for Warm & Safe Wiltshire [a CSE advice service] I would have died after losing my disability allowance.Ellen, Swindon, no EPC
Who responded to the survey
The survey, sent out to clients who had received financial support from CSE, received a good response rate, with 258 individuals participating. The respondents represented a diverse range of households in terms of demographics, vulnerability, and income levels. A high proportion of clients in receipt of benefits and on low incomes were included in the survey. Furthermore, a significant number of respondents reported multiple vulnerabilities, indicating the complex challenges faced by these households.