Meeting fuel poverty targets

Deploying emission reduction measures to benefit the fuel poor

12 December 2014

The Government is committed to reducing carbon emissions, with four legally binding carbon budgets in place. Each cover a five year period from 2008 to 2027, and are set at levels recommended by the Committee on Climate Change (CCC). Meeting these targets will require a substantial shift towards a low carbon economy, which has implications for fuel poverty levels in the UK. Therefore, the CCC commissioned CSE to undertake some modelling and analysis to explore the potential impact on fuel poor households of meeting the fourth carbon budget.

CSE was ideally positioned to carry out this work having recently developed a tool (the National Household Model) for the Department of Energy and Climate Change (DECC), designed to simulate policy scenarios and investigate the possible impacts on household energy demand (and associated fuel bills and emissions) over time.

Head of Research and Analysis, Joshua Thumim said “The project represented an exciting and challenging opportunity to utilise a new modelling tool to undertake some crucial modelling and analysis of the potential impacts of carbon budgets on fuel poverty. The results have important implications for UK climate change, energy and fuel poverty policy.”

The research used the NHM to simulate the deployment of measures across the UK housing stock, identified by the CCC as necessary to deliver the emissions reductions targets to 2030. The results are encouraging, suggesting that if the CCC’s projected mix of measures are deployed to ensure fuel poor households benefit, they could achieve both reductions in carbon emissions and fuel poverty levels. However, meeting the carbon budgets and shifting to a low carbon economy in a way doesn’t exacerbate fuel poverty, is dependent on there being policies and programmes that ensure the fuel poor benefit from measures and are protected from paying for the policies through energy bills.

This research was particularly timely, coinciding with the publication of the Government’s consultation document on its new Fuel Poverty Strategy: “Cutting the cost of keeping warm”. Recognising the opportunity to build on the existing work, the CCC commissioned CSE to undertake some additional modelling to explore the potential mix of measures needed to meet the proposed targets; this mix was then compared with the measures in its current projections for meeting the carbon budgets. Again, the results show the potential dual benefit of deploying energy efficiency and low carbon measures across the housing stock, but highlight several issues: ineffective targeting of support at fuel poor households, the inadequacies of current funding commitments and the need to move beyond low cost measures.

The Government’s proposed fuel poverty targets include achieving a minimum energy efficiency rating in fuel poor homes by 2030, with interim targets for 2020 and 2025. Whilst both the CCC and CSE welcome the minimum rating approach, the results of the modelling suggest the interim targets lead to inefficient, repeat targeting and should be dropped. Instead, it is recommended that measures are installed to achieve the higher energy efficiency rating in the first instance; this is a more economically, socially and environmentally sound approach.

Full project reports are available as downloads from the CCC website:

Image: Taku, flickr

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