New official Welsh Government fuel poverty estimates indicate that up to 45% of households in Wales are now likely to be in fuel poverty, National Energy Action (NEA) said on 13 April 2022. The charity said 115,000 households, or 8%, are living in severe fuel poverty, meaning they must spend more than 20% of their income to keep warm1.
Under the Welsh Government's Tackling Fuel Poverty Plan 2021 to 2035, a household is measured as being in fuel poverty if it needs to pay more than 10% of its full household income to maintain a satisfactory heating regime, and in severe fuel poverty at more than 20%1. For comparison, in 2018 an estimated 155,000 households, or 12%, were in fuel poverty in Wales, of which 32,000 were in severe fuel poverty, or 2% of all households1. NEA said there are now almost as many households in severe fuel poverty in Wales as there were in fuel poverty in 20181.
Ben Saltmarsh, NEA's Head of Wales, said the figures were worse than feared and that the energy crisis was having a catastrophic impact. He said over 217,000 households were living on the lowest incomes and struggling to keep warm and safe at home, and that those in severe fuel poverty could do very little to improve their own situation1.
"These statistics are worse than feared. The energy crisis is having a catastrophic impact on households across Wales, with almost half of all households estimated to be in fuel poverty."
NEA said it and advice organisations across the country would do all they could for those in greatest need but were at the limit of the support they could provide, and that further targeted support from the Welsh and UK governments would be needed1. It called on the Welsh Government to ensure its Cold Weather Resilience Plan results in co-ordinated efforts across government, health, housing and third sectors to prepare for winter, to ramp up its benefits take-up campaign, and to ensure the Warm Homes Programme is sufficiently equipped to lift households most in need out of fuel poverty1. It also called on the UK Government and Ofgem to exempt vulnerable households, particularly prepayment energy users, from the £40 a year levy planned to repay the £200 energy bill rebate, to provide additional support for low-income households ahead of next winter, to develop a social tariff, and to start a payment matching scheme to help clear utility debts1.
On health, NEA said hundreds of people die in Wales every year as a result of living in a cold home, and that the impact of poor-quality housing on health services is estimated to cost the NHS in Wales approximately £95m every year. It cited Public Health Wales estimates that every £1 spent on improving warmth in vulnerable households results in £4 of health benefits1.
Why it matters for households
The estimates put the share of Welsh households in fuel poverty at up to 45%, against 12% in 2018, and the share in severe fuel poverty at 8%, against 2% in 20181. For a household, the practical effect is that a much larger number of homes are now spending a tenth or more of full household income on maintaining a satisfactory heating regime, and a smaller but growing group is spending more than a fifth1. NEA describes those in severe fuel poverty as being on the lowest incomes, living in the least efficient homes, and having little or no ability to improve their own situation1. That bears directly on a home's energy independence: where a household cannot afford to heat to a satisfactory level, the ability to keep the home warm and safe depends on support rather than on the home's own running costs. The Warm Homes Programme is the Welsh Government's key delivery mechanism for tackling fuel poverty, and NEA said it has been widely acknowledged, including by the Welsh Government, that its investment and scale have not been sufficient to meet need or targets1.
What happens next
NEA said action will include another Winter Fuel Support Scheme payment later this year, widened to reach more low-income households in need, including pensioners eligible for Pension Credit, and that it is key this is paid to as many eligible households as possible ahead of October1. Under the Tackling Fuel Poverty Plan 2021 to 2035, the Welsh Government has set three targets for 2035: no households estimated to be living in severe or persistent fuel poverty as far as reasonably practicable; not more than 5% of households estimated to be in fuel poverty at any one time as far as reasonably practicable; and the number of households at risk of falling into fuel poverty more than halved based on the 2018 estimate1. The Welsh Government's new fuel poverty estimates are published as modelled estimates for Wales, with the figures in the release given for April 2022 and further statistics available in the statistics report for October 20211.