Nearly five million households are at risk of financial difficulty if fuel prices rise

31st March 2015

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Nearly five million households are highly vulnerable to energy price rises because they spend more than 10% of their income on fuel, a new study has found.

The research revealed that there are 4.8 million fuel vulnerable households who  spend 10% or more of their income on energy, including almost 900,000 homes who spend over 15%.

The study by uSwitch.com, the comparison website, found both old and young consumers are affected by the issue of energy affordability: over a third of over-75s and around a sixth of under-30s are classed as fuel vulnerable.

Of the poorest households, fuel vulnerability affects 1.3 million families, 673,000 homes with disabled residents and 565,000 pensioner households.

uSwitch is calling on the Government to urgently extend the Warm Home Discount to all energy suppliers to help reduce the number of fuel vulnerable consumers. It provides a £140 per year discount to eligible customers.

Despite recent proposals for standardised eligibility criteria, suppliers still have varying rules about who qualifies for the discount. In addition, many small energy providers, who frequently undercut the big six suppliers on price, are not currently included in the scheme.

Regionally, the highest proportion of those who are fuel vulnerable are in Wales (24%), followed by the West Midlands (23%) and the East Midlands (22%) – despite the fact that these areas do not all have the lowest average incomes.

Ann Robinson, director of consumer policy at uSwitch.com says: “Energy is a basic human need and it is shocking in this day and age that so many consumers, both young and old, are struggling to pay for it. The figures underline the fact that energy affordability affects a large cross section of society, including working families and disabled people. As a result, many could be suffering ill health by rationing their energy use to cope with sky-high bills.”

Robinson adds: “Urgent action is needed to help the millions of fuel vulnerable households across Britain. The Government should extend the Warm Home Discount to more consumers who are struggling with energy costs, especially as so many of them don’t currently qualify. The scheme should also be extended to all energy suppliers – not just those with over 250,000 customers. The cheapest tariffs are often from newer, smaller providers, and so are out of the reach of those who need them most.

“Energy companies must also continue to do all they can to help fuel vulnerable customers to reduce their bills and offer support for home efficiency improvements.”

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