Despite the £400 energy bills payment, seven million homes in the UK will experience fuel poverty this winter without a further £14bn package of emergency support, the Warm This Winter campaign has warned. The group is calling for urgent additional assistance for the most vulnerable and says help is needed to avoid “severe health impacts of living in cold, damp homes crippling the NHS and causing excess winter deaths”.
There were 3.2 million fuel-poor households in England in 2020, according to recent government data.
The data also shows that fuel poverty was proportionately more prevalent in rural areas because rural homes are typically less energy efficient and may therefore rely more on expensive heating fuels.
The energy efficiency of a property is measured using the Fuel Poverty Energy Efficiency Rating (FPEER). In 2020, rural households with the poorest FPEER rating of F or G had an average fuel poverty gap of £1,095 compared with an average fuel poverty gap of £971 for urban households of the same energy rating.
But what is fuel poverty and how is it calculated?
What is fuel poverty?
Fuel poverty is the state of being unable to afford to keep one’s home adequately heated because paying those costs would leave little remaining income and push the household below the poverty line.
It is now measured by using the Low Income Low Energy Efficiency (LILEE) indicator rather than the previous Low Income High Costs indicator.
There’s also something called the poverty fuel gap – this is the additional income that would be needed to bring a household to the point of not being fuel-poor.
Overall, the average fuel poverty gap for households that were fuel-poor in 2020 was £223.
Households in urban areas had an average fuel poverty gap of £193 compared with a gap of £388 in rural areas, according to government data. This rises to a fuel poverty gap of £501 for fuel-poor households in rural villages, hamlets, and isolated dwellings.
What are the criteria and threshold for fuel poverty?
Households are considered fuel-poor if they have to spend more than 10 percent of their income (after tax and NI deductions) on maintaining an adequate level of warmth.
Under the new LILEE definition, households are considered fuel-poor if they have a FPEER of band D or below (low energy efficiency), or if they would be left with a residual income below the official poverty line (low income) after their fuel payment.
How to find out your fuel poverty status
There’s a free Excel tool that can be used to a household status that is based on the official method of calculating fuel poverty by the government.
The tool includes a form that can be used to directly calculate fuel poverty status for individual households. A database tab can be easily populated from data entered in the form tab, and there is also a printable questionnaire that can be used to collect data through face-to-face interviews during home visits.
To calculate your status you will need your total household net income (after tax and national insurance contributions), income from benefits, cost of council tax and other housing costs such as rent and mortgage payments, number of adults and children under 14 who live permanently in the household, and annual energy costs (ideally calculated from an energy assessment).
You can also calculate your fuel poverty ratio using this equation:
Fuel Poverty Ratio = Fuel costs (use x price) / income.
If the ratio is above 0.1 then the household is fuel-poor.
What help is available
There is help available for those who are fuel-poor and struggling financially.
If you’re over 65, you might be able to get £250 and £600 towards your heating bill. This is known as a ‘‘Winter Fuel Payment’’.
Or you could get £150 off your electricity bill this winter under the Warm Home Discount Scheme. You must be on low income for this or claim pension credit.
You can also get a payment of £25 for each seven-day period of very cold weather (0C or below) between November 1 and March 31. You have to be on certain benefits to apply for this.
