CSE report reveals ’under-consumption’ of energy

UK households spend less on energy than policy-makers think

28 October 2011

British households consume on average only around 70% of the energy that the 2007 English House Condition Survey – one of the cornerstones of energy policy making – says that they “need”.

This surprising finding is one of the headline results presented in a new report 'Understanding fuel expenditure', written by Ian Preston and Vicki White of CSE, and Donald Hirsch of Loughborough University, and commissioned by Consumer Focus.

And the 'under-consumption' is found in both rich and poor homes alike, with at least 80% of households in all income groups consuming “too little” electricity, gas or oil.

This is important because it suggests a disconnection between the model used by policy-makers to predict energy use, and what households actually do. It is particularly significant for our understanding of fuel poverty.

"What we don't know is why so many people are consuming less energy than expected," said Ian Preston. "It may be because they're happy to heat their homes less than the 'recommended' amount. It may be that they don't occupy all the rooms in their house, or they're away from home a lot. And of course it may be because they can't afford it.

"Yet a full understanding of fuel poverty requires information about actual spending on fuel."

To heat, or not to heat

The report was commissioned by Consumer Focus as part of their engagement with the Hills Fuel Poverty Review – the ongoing government process designed to take a fresh look at the fuel poverty target and definition'.

"We have long recognised that low-income consumers tend to either cut back on fuel expenditure, and as a result suffer cold homes, or try to maintain fuel expenditure and then either go into fuel debt or forego expenditure on other essential goods and services," said William Baker of Consumer Focus.

"We therefore commissioned this piece of work to investigate these issues further, particularly with respect to the relationship between consumers’ actual fuel expenditure and so-called ‘required fuel expenditure’."

Click here to download the report.

The analysis presented in this report utilises a new data resource that combines data from different surveys into a single, unified dataset to enable comparisons of fuel usage, fuel need and income – the first time these variables have been examined together in this detail.

This has been refined by CSE, working with the Universities of Bristol and Oxford, and with funding from the Joseph Rowntree Foundation, and reflects a growing interest in using fuel consumption estimates to improve our understanding of fuel poverty. In another example of this, the government is developing a data framework that makes direct use of actual household energy consumption figures provided by fuel suppliers.

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