Good news at last! Ofgem has announced this morning that the energy price cap will drop by 12.3% in April. This is a significant enough reduction to have a meaningful impact on household energy costs – potentially £300 for the average household over a year. We also know that domestic energy consumption has fallen since the energy crisis began. I would love to say this is due to the installation and retrofit of energy efficiency measures but the truth is it’s largely down to people desperately trying to save money.
So fuel bill stress will ease a little for now but – and there is always a ‘but’ – prices are still 50% higher than they were two years ago and likely to stay that way for years to come. And energy prices push other costs up too – food, transport and other basic needs all need power so living costs are still rising.
Two years into the crisis there is a significant minority who have been at the cliff edge for a long time.
What we know now, two years into the crisis, is that many people have absorbed these extra costs for the time being. But while missing a holiday or buying cheaper Christmas gifts to balance the books doesn’t sound too much of a sacrifice, we know there is a significant minority who don’t have any fat to trim. They have been at the cliff edge for a long time and the impact of fuel poverty for these people is real and immediate: children doing their homework in a cold kitchen, an older person only able to heat one room or even forced to stay in bed all day. Callers to Severn Wye’s adviceline tell us they don’t invite friends and family over or go out to socialise. They tell us their health deteriorates when it is cold – sometimes in life-threatening ways. Citizens Advice says fuel debt has risen to a staggering £3bn – up nearly £3/4bn this winter alone.
To make matters worse, this winter sees the end of much of the financial support the government put in place, including the Household Support Fund. We have given out over £0.5m of payments to fuel-poor households to keep the heating on over the last six months. Next year much of this money will not be available.
So the headline is that things are getting a little better and this news is most welcome, but too many people will continue to struggle through the winter in cold and leaky homes. Energy prices are volatile too so there is no guarantee things won’t change for the worse again. The reality is, the cliff edge is far too close for too many.
