Improving the energy efficiency of existing homes will play a critical role in delivering the UK’s greenhouse gas emission reduction targets, including net zero by 2050 as well as lifting households out of fuel poverty.
Let me be clear, no-one should be struggling to afford to keep their home at a reasonable temperature in a modern society, and although we have seen progress toward this goal, there is still so much my colleagues and I can do to make this a reality.
One of the principal ways in which we can tackle fuel poverty in the long-run is to improve the energy efficiency of homes. In the Clean Growth Strategy, the Government set out its aspiration for as many homes as possible to be Energy Performance Certificate Band C by 2035 where cost effective, affordable and practical, and to reach this standard by 2030 for fuel poor homes. I am glad that the Government has set interim milestones for England to improve as many fuel poor homes as is reasonably practicable to a minimum energy efficiency rating of band E by 2020, band D by 2025, and band C by 2030, in line with the UK's 2030 fuel poverty target for England.
Work is already underway to make as many homes as possible reach Energy Performance Certificate (EPC) Band C by 2035 where practical, cost-effective, and affordable.
Households struggling with their bills are eligible for insulation measures, including solid wall insulation, through the Energy Company Obligation (ECO) scheme. Homeowners and those in privately rented homes who are on specific benefits may also be eligible for support towards heating improvements, including oil-fired boiler replacements, through ECO Affordable Warmth.
The Warm Home Discount is a key policy in the Government’s programme to tackle fuel poverty and the effects of rising energy prices on low-income households. Launched in April 2011, it has helped over 2.2 million low-income and vulnerable households, including individuals with a disability, each year with their energy costs. The Government is continuing with plans to increase the Warm Homes Discount and extend eligibility by one-third to 3 million vulnerable households worth £150. I am glad that the Energy White Paper committed to extending the scheme to at least 2025/26 and the Government is committed to expanding the spending envelope from the current £351 million to £475 million (in 2020 prices) per year, to reach over 750,000 more households in, or at risk of, fuel poverty. Furthermore, later this year the Government will consult on reforms to the scheme from 2022 to better target fuel poverty.
Following Ofgem’s – the independent regulator who sets the price Energy Price Cap - confirmation that the energy price cap will rise by £700 from April, the Government has announced a three-part plan to help with household fuel bills immediately and protect people against half of this increase – worth £350 per household, in a total package of support worth £8.6 billion:
• A £200 ‘smoothing’ rebate on energy bills for all households, to be paid back over the next five years at £40 per year – starting from April 2023;
• A non-repayable £150 cash rebate for homes in Council Tax bands A-D – equivalent to 80 per cent of all households, helping both lower and middle-income families;
• £144 million of discretionary funding for local authorities to support households not eligible for the council tax rebate.
The Government is also continuing with plans to increase the Warm Homes Discount and extend eligibility by one-third to 3 million vulnerable households which is worth £150.
In addition, the Government is boosting funding for the Social Housing Decarbonisation Fund (investing a further £800 million over 2022/23 to 2024/25) and Home Upgrade Grant (investing a further £950 million over 2022/23 to 2024/25), which aim to improve the energy performance of low income households’ homes, support low-carbon heat installations, help to reduce fuel poverty and build the green retrofitting sector to benefit all homeowners.