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Fuel poverty in England remains a persistent issue, with little to no reduction in the number of affected households over the past five years, according to a sobering new report from the Committee on Fuel Poverty. Despite various policy initiatives, the situation has not improved "to any meaningful extent," highlighting an urgent need for a comprehensive "reset, a refresh, and a renewed focus" on energy efficiency nationwide.
In its 2024 Annual Report, the Committee reveals that 13 per cent of households in England—approximately 3.17 million homes—were living in fuel poverty in 2023. This figure shows a negligible decrease from the previous year's estimate of 3.18 million, indicating a stagnation in progress.
The Committee advises the government on policy and points out that the battle against fuel poverty has largely stalled since 2019, despite nearly a decade of significant advancements that saw a 40 per cent reduction in fuel poverty rates between 2010 and 2019. This stagnation signals a critical juncture where renewed efforts and strategies are needed to resume progress and address the energy needs of millions of vulnerable households.
"Fuel poverty has flatlined," said Committee chair and former Labour MP Caroline Flint. "I don't think any government anticipated this. Perhaps the stable energy prices for most of the 2010s created an optimism that fuel poverty would continue to fall for years to come. That optimism was misplaced.
"Last year, the Committee hoped that with the pandemic behind us, energy efficiency programmes would step up and progress would continue – even if the government's milestones were at risk of being missed. Now, it seems the pandemic – when so much stopped - obscured the lack of progress being made."
The UK's housing stock ranks among the least energy-efficient in Europe, with millions of homes and buildings needing critical green upgrades—such as improved insulation and low-carbon heating—if the nation is to meet its net-zero emissions targets. This challenge is further compounded by the ongoing cost of living crisis, which has seen energy bills skyrocket due to the aftermath of the COVID-19 pandemic and geopolitical tensions, including Russia's invasion of Ukraine. These factors have increased inflation, making it increasingly difficult for households and businesses to manage their energy costs.
Energy bills will unlikely return to pre-crisis levels until at least the end of the decade. Ofgem's recent announcement of a 10 per cent increase in the energy bill price cap this winter has intensified calls for targeted support for vulnerable households and a faster rollout of green home retrofits nationwide.
Despite the grim statistics, the report's outlook remains hopeful, with Committee Chair Flint emphasizing that this is not a "defeatist" stance. She argues that fuel poverty can be eradicated with a renewed strategy that includes targeted financial support, such as social tariffs designed for vulnerable and low-income households over the coming years.
The report urges the government to craft a new, comprehensive fuel poverty strategy for England that guarantees "affordable energy for all." This strategy should include a thorough review of the metrics used to assess fuel poverty, ensuring they accurately reflect the current challenges.
This strategy is central to reinstating a "fabric first" approach to energy efficiency. The Committee argues that the recent shift away from improving homes' thermal performance has been less effective at keeping households warm. They advocate for prioritizing measures such as insulation in all fuel-poor and vulnerable households before integrating low-carbon heating systems, like heat pumps, into these properties.
Furthermore, the report warns that failing to improve energy efficiency in the private rented sector swiftly could severely compromise the government's overall strategy to end fuel poverty. It also emphasizes the importance of continued research and data sharing to ensure that support is accurately targeted where it is most needed.
The Committee also highlighted the disproportionate impact of fuel poverty on ethnic minority households and those using prepayment meters, noting that these groups are among the most at risk of being unable to afford their energy bills, resulting in cold and uncomfortable home environments. Additionally, with over 900,000 households in England with children currently in fuel poverty, the report insists that any strategy to combat this issue must be closely aligned with broader efforts to eliminate child poverty.
"Our report exposes hidden aspects of fuel poverty: like very high concentrations of ethnic minority households in fuel poverty in some of our large towns and cities; like the lack of progress in the low-cost private rented sector, where too many people are still living in cold homes," added Flint.
"This report argues that the Fuel Poverty Strategy requires a reset, a refresh and a new focus to continue to bear down on a problem which too many low-income households endure year on year. The Committee hopes to see a renewed drive to improve the fabric of our coldest homes – a fabric-first approach."
"Energy prices remain about £700 above pre-pandemic levels – and are rising this winter – this poses a serious challenge," she added. "But the cheapest energy of all is the energy never used because a house retains its heat and stays warm in winter."
The new Labour government has come under fire for its recent decision to reduce winter fuel payments for some pensioners, a move aimed at addressing a significant "£22bn black hole" in public finances. However, reports indicate that Chancellor Rachel Reeves is contemplating an extension of the existing Household Support Fund beyond September 30th to assist vulnerable citizens with the rising costs of food and energy.
In tandem with these measures, Labour has committed £6.6 billion over the current Parliament—doubling the previous government's funding—to upgrade and insulate five million homes. This initiative is part of a broader effort that includes the rollout of a new Warm Homes Plan, which will provide grants and low-interest loans to support households in investing in insulation, solar panels, battery storage, and low-carbon heating solutions.
The government has set ambitious targets to ensure that as many fuel-poor homes as possible reach at least a C rating for energy efficiency by 2030. Additionally, an interim goal is to bring as many fuel-poor homes as "reasonably practicable" up to a D rating by 2025.
In response to the Committee on Fuel Poverty's report, Minister for Energy Consumers Miatta Fahnbulleh acknowledged the ongoing review of the current Fuel Poverty Strategy, affirming that Labour's new Warm Homes Plan will play a crucial role in upgrading millions of homes, making them both warmer and more cost-effective to run. This initiative is critical to the government's broader strategy to combat fuel poverty and enhance energy efficiency across the UK.
"We are reversing a legacy of fuel poverty that has left some of the most vulnerable households living with the consequences of cold homes and soaring energy bills," she said. "And we will do everything we can to make sure that struggling families are protected whilst we make the transition to homegrown clean energy that will lower bills for good."
Jess Ralston, head of energy at the Energy and Climate Intelligence Unit, echoed the Committee's calls for a "reset" of the fuel poverty strategy.
"Anyone who has paid a gas bill over the last few years knows the real-world impacts of relying on gas for home heating and electricity generation - with people in fuel poverty suffering most from the extortionate and volatile prices of the fuel," she said. "Energy efficiency schemes are not performing at the target level at the moment but could be the light at the end of the tunnel as insulation lowers bills and decreases gas demand in households, which will increasingly come from abroad as the North Sea continues its inevitable decline.
"In the long term, the solutions of upgrading our leaky housing stock, transitioning away from gas boilers, and building renewables will help to shield fuel-poor households from future gas crises, with no time to waste."
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