A coalition of over 130 charities, organisations and MPs sent an open letter to the Prime Minister on 29 September 2023 calling for an energy social tariff, according to a Commons Library debate pack published on 20 October 20231. The letter was led by National Energy Action, Money Saving Expert, Citizens Advice, Fair by Design, Age UK, Scope and Energy Action Scotland2. National Energy Action said the letter had been signed by over 140 charities, organisations and MPs2, while the Commons Library put the figure at over 1301.
The letter argues that a social tariff would offer a long-term solution to fuel poverty and could have economic and health co-benefits1. A social tariff is often understood to be a levy or subsidy-funded reduction in the cost of basic utilities for targeted groups of customers, typically those least able to pay1. The signatories also said it is unlikely that a social tariff could be implemented in time to provide the immediate support required this winter, and urged targeted short-term support instead2.
"The government must deliver on its commitment to introduce better targeted support by April 2024"
The government committed in the Autumn Statement 2022 to a "new approach to consumer protection from April 2024", saying it would "work with consumer groups and industry to consider the best approach, including options such as social tariffs, as part of wider retail market reforms"1. That consultation has not been published1. The Energy Price Guarantee is set to end in 2024, and the Energy Bill Support Scheme ended in March 20231.
| Measure | Detail | Status |
|---|---|---|
| Energy Price Guarantee | £2,500 a year for typical consumption, rising to £3,000 from July 2023 to March 2024 | Set to end in 20241 |
| Energy Bill Support Scheme | £400 discount for every household with a domestic energy connection in GB, winter 2022 to 2023 | Ended March 20231 |
| Alternative Fuel Payment | One-off £200 credit for households using heating oil, LPG or coal | Paid from February 20231 |
| Warm Home Discount | £150 discount each winter for those on certain benefits, suppliers with over 50,000 customers | Ongoing obligation1 |
Ofgem's default tariff cap fell to £1,923 on 1 October 2023, but annual bills for typical consumption remain almost £800, or 69%, above summer 2021 levels1. National Energy Action said typical bills would be over 50% higher than pre-crisis levels, and 13% higher than the previous winter2. Its figures show 6.3 million households in fuel poverty from 1 October, an increase of over 2 million since October 20212. Total household energy debt stands at £2.25 billion, more than 70% up on three years earlier2. YouGov polling for the charity found 34% of British adults expect to struggle to afford heating this winter without government support2.
Why it matters for households
The debate concerns who pays for the gap between wholesale prices and what low-income homes can afford. Under the current price cap, support is broad and temporary: the £400 Energy Bill Support Scheme has ended and the Energy Price Guarantee is due to finish in 20241. A social tariff would instead target a reduction at named groups, typically those least able to pay1. For a household, the practical difference is whether help arrives automatically through the tariff or depends on eligibility for means-tested schemes such as the Warm Home Discount, which pays £150 a winter1. The fuel poverty figures cited in the letter show the scale: 6.3 million households from 1 October2. The letter's signatories say high prices are unlikely to return to pre-2021 levels this decade, so the design of any replacement matters beyond this winter2.
What happens next
A Westminster Hall debate on energy social tariffs was scheduled for 23 November 2023, chosen by the Backbench Business Committee and opened by Marion Fellows MP1. The government has not published its consultation on consumer protection from April 20241.
Sources2 cited
- CDP-2023-0202.pdf, researchbriefings.files.parliament.uk
- Coalition of over 140 organisations and MPs call for consultation on a social tariff for energy - National Energy Action (NEA), nea.org.uk