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Government unveils new strategy to protect vulnerable consumers and reduce energy bills, what does this mean for energy suppliers?

Richard Simmonds • Feb 16, 2021

 A new strategy to protect the most vulnerable, tackle fuel poverty and cut the energy bills for hundreds of thousands of consumers across England has been announced by the government. 

What is the new strategy?

The new strategy will see support for vulnerable energy customers rise in order to assist them with paying for rising energy bills and to aid them with making green upgrades to their properties. 

According to the government, the plans would see families on lower incomes save as much as £500 per year on energy costs.

Dubbed the Fuel Poverty Strategy for England, the plans include a government commitment to invest an extra £60 million to retrofit social housing and an extra £150 million for the Home Upgrade Grant.

The Warm Home Discount (WHD) scheme will also be extended and will see energy suppliers continue to have to provide a £140 rebate on the energy bills of the most vulnerable pensioners and low income households. The WHD will also be offered to an extra 750,000 homes to bring the grand total of those being supported up to 2.7 million.  

What does this mean for energy suppliers?

Energy suppliers will now have to step up their support for consumers under the Energy Company Obligation scheme which requires larger energy suppliers to install insulation, heating or energy efficient measures into low income or vulnerable households.


The ECO will be extended until 2026 with its funding boosted from the current £640 million to £1 billion a year.


Under ECO3 low income households have reportedly saved up to £300 and the planned ECO4 is expected to provide even more financial support and assist customers to save more.

Energy suppliers need to keep their records up to date as well as ensure the correct customers are added to the relevant schemes. To do this the most vulnerable customers should be added to the Priority Services Register.


According to government statistics there are currently 1.2 million low income households living in the low energy efficient homes. The newly announced Minimum Energy Efficiency Standards are also predicted to save private renters up to £220 on their energy bills.

 

Also read: Add your Customers to the Priority Service Register with Dyball’s CRM


What is the Priority Service Register (PSR)?

The PSR is a free service provided by energy suppliers and network operators to customers in vulnerable situations. A customer can sign up to the register if they are:

  • ·Of pensionable age (currently 65 or over)
  • ·Are disabled or suffer from a chronic illness
  • ·Have a long-term medical condition
  • ·Have a hearing or visual impairment or additional communication needs
  • ·Are in a vulnerable situation including customers with certain mental health issues that may impact their understanding of their energy bills
  • ·Customers who are unable to top-up a prepayment meter due to an injury
  • ·Temporary circumstances where they may need extra support
  • ·Families with children 5 years old or younger


Customers on the PSR are eligible for several free services such as receiving advance notice of any planned power cuts, priority support in the event of an emergency and an identification scheme to reassure customers that callers and meter readers from their suppliers are genuine.


Also read: Add your Customers to the Priority Service Register with Dyball’s CRM

Offering more assistance as Covid-19 crisis continues

Many consumers are struggling due to the lockdowns introduced because of the Covid-19 pandemic. Several support schemes have been announced over the course of the crisis with organisations such as Energy UK launching the Vulnerability commitment.


“This strategy sets out our plan to ensure everyone can afford the energy required to keep their lights and heating on, especially during the winter. Coronavirus has resulted in many consumers seeing reduced income and therefore an increased number of households may now be struggling with their energy bills, especially as it gets colder.


“This strategy reflects our commitment to helping the most vulnerable, and how action already taken is helping to make a real difference to fuel poverty. We already have schemes to increase the energy efficiency of homes, reducing the cost of bills whilst also contributing to net zero targets. The expanded Energy Company Obligation is one example of such a programme, resulting in warmer and greener homes for those most vulnerable. We are also protecting tenants against cold homes and high energy bill costs through increased energy efficiency standards,” said Business and Energy Secretary Kwasi Kwarteng. 


Further Reading

Renewable Energy broke records in 2020 as Industry warns Household energy bills could be hiked to fund more green energy projects


How to convince consumers to switch to a smaller energy supplier


Government slashes Green Homes Grant Voucher Funding due to low uptake


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