Tag Archives: energy

Price cap rise will be ‘heavy blow’ to household finances already hit by Covid

From 1 April 2021, Ofgem will introduce a new increase in the energy price cap, which will see it increase by £96 for default tariff customers, and by £87 for pre-payment meter customers.

According to Ofgem, default tariffs and pre-payment meters are already some of the more expensive energy options, and research shows that pre-payment meter customers are more likely to be living in fuel poverty.

However, Nicky Willshere, Chief Executive of Citizens Advice Ipswich, adds that this rise not only comes during a “tough jobs market and essential bills rising”, but also the rise will come “at the same time as the £20 a week increase to the benefit is set to end”. The £20-a-week increase to Universal Credit and Working Tax Credit is set to end on April 5.

To visualise the twinned effect of the price rise and the cut to the Universal Credit boost, the £20 uplift would cover nearly a whole week (six days) energy costs for a below average income household.

Indeed, in December, Citizens Advice research showed that 2.1 million households were behind on their energy bills, 600,000 more than in February 2020. That was with the reduced energy price cap and the £20 uplift. This could affect many of our clients, because since 1 March 2020, Citizens Advice has supported more than 350,000 people with Universal Credit.

As such, Nicky Wilshire argues that “now is not the time for the government to cut this vital lifeline”.

Private renters in poor quality homes face £1,000 higher costs to heat their homes

Three quarters of a million private renters are stuck in the coldest and draughtiest homes, new Citizens Advice analysis reveals.

To heat their homes to a comfortable standard, these tenants face spending £1,000 more than the national average on their energy bills – but are reliant on landlords to make cost-saving improvements.

Citizens Advice analysis reveals landlords could be raking in almost a quarter of a billion (£242 million) per month for letting out homes that will be freezing cold in the winter.

Some 750,000 private tenants are thought to be living in over 300,000 properties in England with the worst energy efficiency ratings of F and G. These renters face more problems with damp, lack of central heating and poor insulation.

Renters living in band F and G homes:

  • Are twice as likely to suffer from damp than any other properties
  • Half a million have no access to central heating or storage heaters
  • Nearly two thirds have no wall insulation
  • Less than half have modern condensing boilers, which have been mandatory for any new or replacement installations since 2005

The average private rent for F and G band properties in England is £174 per week. In addition to this, energy bills are often very expensive in these homes.

Those currently living in the lowest, G rated, properties face spending £2,600 a year to keep warm – more than twice as high as the national average (£1,210), according to research from the Association for the Conservation of Energy.

The Energy Act 2011 introduced a legal requirement for all rented properties to have an energy efficient rating of at least Band E by 2020. All new tenancies must meet Band E standards by 2018.

However, regulations introduced last year means landlords don’t have to take any action that costs them an upfront fee.

Citizens Advice says the government should make landlords carry out improvements costing less than £5,000 that will take homes up to the minimum Band E standard. It also says a new fund – paid for by the stamp duty levy – could be set up to help landlords pay for more expensive improvements.

Gillian Guy, Chief Executive of Citizens Advice, said:

“Thousands of private tenants face a bleak winter in cold and draughty homes.”

“Not only do they suffer more problems with damp and poor heating, these private renters also pay way over the odds on energy bills to keep warm. But with private tenants footing the cost of heating, landlords have little incentive to make upgrades.”

“Our research reveals that many landlords still have a long way to go to bring the worst energy wasting homes up to scratch – so it’s vital the government takes action to insist that all landlords who can afford to – raise standards in the homes they let.”

“If people are happy to take on the role of a landlord – they need to be responsible enough to make sure the property is safe, comfortable and fairly priced.”

Citizens Advice also proposes setting up a new energy improvement fund to help landlords with improvements costing more than £5,000. This fund would be paid for by increasing the stamp duty levy on buy-to-let homes to 4%. This would raise over £200 million to be used for efficiency improvements. The fund could also incentivise landlords to make further improvements that would take their property rating up to Band C.

Nicky Willshere, Chief Officer at Ipswich Citizens Advice added:

“Next week Citizens Advice Ipswich will be taking part in Big Energy Savings Week to encourage people to check fuel usage and take action where necessary. Private renters are often at a disadvantage as to tariffs or the quality of heating systems. Citizens Advice can help them work out what steps they can take to avoid or minimise fuel poverty.”