Certainty and efficiency in the face of increasing energy costs

Posted by Jennifer Thompson  on 09 July 2018 | 0 comments

The last nine months has witnessed unusual and severe weather events, with warnings issued in relation to hurricanes, storms, and most recently, hot weather. What has become clear, is that changing weather patterns mean that the winter season is no longer a neat set period.
 
According to the latest Survey on Income and Living Conditions (SILC), 48% of people living in consistent poverty went without heating at some stage in the last 12 months due to cost and 29% were unable to afford to keep their house adequately warm.
 
SVP continue to address the needs of families in energy poverty by providing advice and financial assistance. The Society is an active on-the-ground advocate for affordable energy and energy efficiency initiatives. Recent weather events have served as a stark reminder of the stress many households continue to face over being able to meet their utility costs, a reality that SVP members know all to well.
 
When considering the Public Service Obligation (PSO) levy, standing charge and VAT, the uncontrollable related costs of the average electricity bill accounts for 37% in urban areas. For rural areas, this increases to 39%. The PSO levy alone has increased by more than 231% over the last five years.
 
Increasing energy costs are a particular concern considering a report by the Sustainable Energy Authority of Ireland (SEAI) which found that after a decade of decline, the typical amount of energy used in Irish homes is again on the rise. Between 2005 and 2016, electricity use in households increased by 5%.
 
As weather patterns become more unpredictable, it is important to future proof support and provide assurance for energy poor, vulnerable customers. This will be particularly important in light of increasing wholesale prices, which has resulted in nearly all energy suppliers increasing their costs over the last six months. Energy costs have seen an increase of 7.6% in the 12 months to May 2018, with an average increase in energy costs of 24.2% since 2010.
 
Clearly more needs to be done to improve the energy efficiency of the housing stock. SVP welcomed the announcement made by Minister Naughten in March 2018 that the standard measures available under the Warmer Home Scheme are being expanded, allowing for deeper retrofit measures. Such measures broaden the number of homes eligible to receive works, and will help to deliver greater energy savings. A review of other relevant European subsidy schemes has identified that energy consultants can increase awareness and confidence of government schemes.
 
Many of the households that approach SVP for support are from the private rental sector. This sector has a higher proportion of E, F and G Building Energy Ratings (BERs) than either local authority or owner-occupied homes. With upward pressure on rents in Ireland over a number of years, there is less incentive for landlords to improve the energy efficiency of rental properties. Given the expansion of the private rental sector, Government intervention to support the implementation, and monitoring, of minimum standards for the rental sector will be vital if vulnerable tenants are to be assured of energy efficient homes and protected against health implications and energy poverty.
 
With 1 in 4 households living in energy poverty, SVP present a number of initiatives in the area of energy in its recent Pre-Budget Submission. Additional arrangements are needed for low-income households in need of extra fuel assistance in the event of adverse weather patterns. To avoid the uncertainty experienced by energy poor customers during recent storms, the Government should introduce a new Cold Weather Payment scheme that would provide a guaranteed extra one-week payment in the event of extreme cold weather. The rate of Fuel Allowance should also be increased to bring it back to 2010 levels. Uptake of energy schemes can be maximised by investing in more appropriate and tailored dissemination and outreach initiatives and campaigns towards those households in energy poverty. And considering the growing rental sector, it is crucial that the Government make available the evaluation and consultation paper on energy efficiency standards in the rental sector.
 
The above, if introduced by Government would help realise significant improvements and alleviate the stress faced by thousands of low income, energy poor households.
 
 
 

Blog post written by Jennifer Thompson

Social Policy Development Officer

More by Jennifer Thompson

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