Policy measures designed to tackle fuel poverty, such as ECO, need redesigning, scaling up and better targeting, finds Brian Wilson.
Think tank ResPublica has produced a report on fuel poverty, which questions whether the current policy framework is fit for purpose.
Entitled Out of the Cold: An Agenda for Warm Homes, it argues that ways must be found to address key underlying problems.
The facts are pretty stark.
One in every ten households in England – or 2.3 million of them – is living in fuel poverty. The situation is most acute within the private rented sector, where one in every five households is classified as fuel poor.
There are many who report having damp, condensation, mould and draughts. In some ways this is not surprising, since 60% of our housing stock is more than half a century old. We start with one of the oldest and least efficient housing stocks in Europe.
One outcome is households falling into fuel debt. Between July and September 2014 – not the coldest of months – nearly 20,000 people contacted Citizens Advice to seek help about paying their heating bills. Living in poorly insulated homes can mean paying over the odds on fuel bills or not heating the home adequately.
According to the Committee on Climate Change there are still 4.5 million homes with cavity walls which need to be insulated, another 7 million solid wall homes and 10 million home lofts that would benefit significantly from having better insulation.
Although not the specific focus of this report, Rural Services Network members will recognise a rural dimension to all of this. The network's Rural Services Manifesto noted that the fuel poverty gap (or the extra income needed to move out of fuel poverty) is far greater in rural areas than elsewhere. Moreover, over half of homes in small rural settlements lie off the mains gas network and so must depend on more costly heating fuels.
ResPublica state that there is a positive angle, since the energy efficiency of our housing stock has improved markedly. The number of properties measured as inefficient has halved over the fifteen years from 1998 to 2013. Furthermore, investment is increasing, with energy providers soon expected to offer nearly £1 billion per year for lower income households under the Energy Company Obligation (ECO) and the government's Green Deal putting in another £0.6 billion per year to assist able-to-pay households.
According to ResPublica, however, there are three reasons why ECO is not up to the job. First is its "inadequate reach", due to there being no incentive for energy providers to target the neediest households. One result has been the neglect of off grid rural households. Second is its "inadequate scale", with the ECO programme only likely to tackle 1% of solid wall homes and 16% of uninsulated cavity wall homes. Then third is its "inadequate stability", with no contracts for works being let under many of the ECO auctions.
One of the report's recommendations is to improve the enforcement of energy efficiency standards in the private rented sector. The authors' view the discretionary licensing powers held by local authorities as resource intensive and expensive to implement. They suggest that tenants and others, such as health visitors and social workers, be given powers to report landlords whose properties appear to breach standards.
Alongside this stick they propose a carrot (or tax incentive), with the Landlords Energy Saving Allowance being extended and up-rated to a level that more closely matches the levels of investment that are required.
The report also recommends that trusted intermediaries are used to help identify and approach low income households that would benefit from energy efficiency schemes. Their motives are less likely to be questioned on the doorstep than those of energy suppliers. This could include bodies such as rural community councils.
It is suggested that a new devolved delivery model for ECO is trialled, one which could be run by local authorities and housing providers, working with community organisations. This would be an alternative to the current industry-delivered model. It would enable better tailoring, drawing on local match funding opportunities and engaging partners like clinical commissioning groups. ResPublica also propose a separate ring-fenced budget for rural areas, given their under-representation within current ECO programmes.
This is a timely report and many would concur about the scope to improve ECO. Its failure to hit a rural target or to help sufficiently with solid wall homes is now well documented. Ditto the Green Deal's inability to help many of those living off the mains gas network. Some serious re-designing of initiatives would be welcome indeed.