Fuel poverty

A fuel poor household is one which cannot afford to keep adequately warm at reasonable cost. The term is mainly used in the UK, Ireland and New Zealand, although the concept also applies in much of Eastern Europe and the USA.

Definitions

In the UK Fuel poverty is said to occur when in order to heat its home to an adequate standard of warmth a household needs to spend more than 10% of its income on total fuel use. The definition of fuel poverty does not take account of the amount that a household actually spends on fuel, nor the amount available for the household to spend on fuel after other costs have been met. This definition is essentially that first established by Dr Brenda Boardman in her book entitled Fuel Poverty, first published in 1988. [B. Boardman, Fuel poverty: from cold homes to affordable warmth, Belhaven Press, London 1991]

Adequate warmth is generally defined to be 21°C in the main living room and 18°C in other occupied rooms during daytime hours, with lower temperatures at night, following the recommendations of the World Health Organization. However, there are a variety of different ways of considering household income when measuring fuel poverty.

Fuel poverty is not just about access to heating as the definition of fuel is taken to include all expenditure on domestic energy, including that used for hot water, cooling, lights and appliances.

In Eastern Europe (transition economies) the term Energy Poverty is sometimes used instead. [Buzar, S. Energy Poverty in Eastern Europe: Hidden Geographies of Deprivation. Aldershot: Ashgate, 2007.] However this use of the term (which is about a lack of access to energy services due to economic poverty) can be confused with indicating a lack of any access to energy infrastructure, as has been used by the World Economic Forum when establishing its Energy Poverty Action (EPA) initiative in 2005 to address energy poverty in the developing world by implementing electrification schemes (grid-extension and off-grid). [cite web
title = Energy Poverty Action "Delivering business expertise and best practices to reducing energy poverty"
url = http://www.weforum.org/en/initiatives/EnergyPovertyAction/index.htm
accessdate = 2008-05-09]

As Fuel Poverty is seen by some people as sounding unduly negative, some specialists in the field prefer to talk about its converse - Affordable Warmth instead.

Causes of Fuel Poverty

Fuel Poverty is caused by a convergence of four factors:
* Low income, which is often linked to absolute poverty
* High fuel prices, including the use of relatively expensive fuel sources (such as electricity in the UK, aggravated by higher tariffs for low-volume energy users)
* Poor energy efficiency of a home, eg. through low levels of insulation and old or inefficient heating systems
* Under-occupancy: according to UK government statistics, on average those in the most extreme fuel poverty live in larger than average homesThe most effective way of combating fuel poverty, if one excludes forcible rehousing, is to target energy efficiency measures on homes typically occupied by those on low incomes. A home with a very low energy requirement to provide adequate warmth can generally be occupied by those on relatively low incomes without leading to fuel poverty. The sharp rise in fuel prices from 2006-8 has led to an estimated doubling of the numbers in fuel poverty in countries where it is a major problem.

United Kingdom

The UK Government’s preferred definition of household income includes income from housing-related benefits in the calculation of household income. Other estimates of the extent of fuel poverty exclude benefits from household income. The National Energy Action organisation regards both these definitions as unacceptable and believes that disposable income (after the deduction of housing costs) should be used in the definition of fuel poverty. In early 2008 it was estimated by Energywatch that there were around 4.4 million households in fuel poverty in the UK, with just over 3 million in England alone. [cite web
author = Tim Webb (The Observer)
title = Fury as fuel poverty soars close to a 10-year record
url = http://www.guardian.co.uk/business/2008/jan/20/utilities.householdbills
accessdate = 2008-05-09 ] This was more than double the number in 2003.

Under the Climate Change and Sustainable Energy Act 2006 the Government is obliged to report annual progress in cutting the number of households in which one or more persons are living in fuel poverty.

The UK has two main programmes that are designed to address fuel poverty by improving energy efficiency. These are the WarmFront programme, offering a package of measures at no cost to private sector residents meeting certain, mainly income-related, requirements, and the Carbon Emissions Reduction Target (CERT, formerly the Energy Efficiency Commitment), which requires licensed energy supplier to meet certain targets in improving domestic energy efficiency, with at least 40% of such savings to come from defined target groups who are more likely to suffer from fuel poverty. The Government imposes certain standards on public sector landlords to help them lift their tenants out of fuel poverty. The Government also claims that the [http://www.thepensionservice.gov.uk/winterfuel/ Winter Fuel Payment] helps to mitigate fuel poverty, but as this is paid to all households with an occupant over 60, this measure is a generally available benefit and not targeted on the fuel poor.

References

External links

* [http://www.dti.gov.uk/energy/consumers/fuel_poverty/chp1.pdf Chapter 1 the causes and effects of fuel poverty, The UK Fuel Poverty Strategy (2001), DTI]
* [http://www.nea.org.uk/Policy_&_Research/Fuel_poverty_facts/Fuel_poverty_and_energy_efficiency National Energy Action: Fuel Poverty and Energy Efficiency]