It’s time for progress on fuel poverty

In this guest article, Mark Isherwood MS considers what needs to be done to tackle fuel poverty in Wales

It is hard sometimes to find areas of consensus in politics. 

However, across the political divide, it is accepted, if not demanded,  that every person in Wales should be able to live in a warm, safe and healthy home. This is evident now more than ever.

A perfect storm of high energy prices, low incomes, and inefficient housing has thrown hundreds of thousands of households in Wales into fuel poverty.

The International Energy Agency (IEA) stated that “Energy markets began to tighten in 2021 because of a variety of factors, including the extraordinarily rapid economic rebound following the pandemic. But the situation escalated dramatically into a full-blown global energy crisis following Russia’s invasion of Ukraine in February 2022”. 

In October 2022, they said the world faces its first “truly global energy crisis”. 

In consequence, the number of households living in fuel poverty in Wales has sharply increased. 

In 2018, 12% of all households in Wales were estimated to be living in fuel poverty. This increased to 45% of all households by April 2022 and it is estimated that 98% of all lower-income households in Wales live in fuel poverty. 

These estimates remain worryingly relevant as average energy costs currently remain up to 50% higher than pre-crisis levels and despite moderate recent falls they are expected to rise again in October. Under the current price cap, South Wales and North Wales & Merseyside are also consistently in the top three most expensive regions across Great Britain. Standing charges are also at record highs.  

The Welsh Government’s Tackling Fuel Poverty Plan (2021-2035) was published in March 2021 to address fuel poverty in Wales and to support those “struggling to meet the cost of their domestic energy needs”. 

The plan includes three non-statutory targets, namely that by 2035 as far as reasonably practicable: 

• no households are estimated to be living in severe or persistent fuel poverty;
• not more than 5% of households are estimated to be living in fuel poverty at any one time; and
• the number of all households “at risk” of falling into fuel poverty will be more than halved based on the 2018 estimate.

So, what now needs to be done to tackle fuel poverty in Wales? 

Firstly, the Welsh Government should introduce energy-efficiency-based interim targets into the Tackling Fuel Poverty Plan. After all, how can you identify your problem, and measure and adapt your actions, if you don’t have targets?  

The Welsh Government has statutory obligations to specify such targets. However, despite calls from both politicians and experts in the field, including  National Energy Action Cymru and their partners in the Fuel Poverty Coalition Cymru, there remains a noticeable lack of interim targets in the plan.  

With eleven years until the end target date of 2035, there are serious concerns that the non-statutory targets, with no interim milestones, risk not driving the sustained and necessary action and investment that is required to address fuel poverty in  Wales.  

Targets would enable the Welsh Government to review the effectiveness of its strategy and each of its shorter-term actions, and allow proper scrutiny. 

There is also an urgent need to improve the energy efficiency of fuel-poor homes in Wales, with a robust and realistic retrofit programme to make them much warmer, greener, healthier places to live, with energy bills that are permanently low. 

The tender document published by the Welsh Government as part of the procurement process for the new Warm Homes programme outlines that a supplier would be expected to undertake work on 11,500 properties over 7 years. This is equivalent to just over 1,600 properties a year. Based on these figures, it would take over 130 years to improve the energy efficiency of the homes of all our lower-income households currently estimated to be in fuel poverty. 

If the Welsh Government is to meet its 2035 targets and dramatically reduce fuel poverty, both priority funding and an integrated whole-sector approach will be needed.  

Unprecedented levels of UK Government support to households to help with energy bills were provided after the Pandemic and Putin’s invasion of Ukraine. There is still a need for support from the UK Government, such as the provision of additional financial support for fuel poor households over the coming winter, either through altering the Warm Home Discount or a new scheme.  

Increasing household income is a major factor in preventing fuel poverty. It is therefore more essential than ever that people are fully aware of all the financial entitlements they qualify for and are encouraged to take them up. Both awareness campaigns to ensure greater benefit uptake and establishment by the Welsh Government of a coherent and integrated “Welsh benefits system” for all the means-tested benefits it is responsible for, will be needed. 

So, as we bask (hopefully) in the summer sun, let us not forget what winter will bring for the hundreds of thousands of households in Wales living in fuel poverty if urgent and real action isn’t taken. 

Mark Isherwood is Member of the Senedd for North Wales.