Energy rationing an increasing coping mechanism for dealing with fuel poverty.
Blog by Kirsten Jenkins, Panel Member and Fran Eatwell-Roberts, Analytical Manager.
The Scottish Fuel Poverty Advisory Panel has co-funded research into energy service rationing in Scotland to understand the factors impacting rationing, the groups more likely to be affected and the cross-sectoral recommendations to help tackle the problems identified.
The recent reduction in the energy price cap has again brought into sharp focus the impact of the energy crisis on households. Citizens Advice has reported that despite the cut in the price cap, thousands will start the winter behind on their bills and a recent Consumer Scotland tracker stated just over six in ten (62%) are reporting rationing of energy due to affordability challenges.
With winter on the horizon, the Scottish Fuel Poverty Advisory Panel is concerned that the high and volatile cost of energy will see the trend of energy rationing worsening with increasing numbers unable to heat their homes due to energy debt and income shortfalls among other challenges.
Energy service rationing (also known as self-rationing or in extreme cases, self-disconnection) is when a household cannot (or does not) heat their home to the temperatures necessary for good health and wellbeing as recommended by the World Health Organisation and/or limits the use of other energy services.
Unfortunately, energy service rationing (hereafter “self-rationing”) is a common and increasing coping mechanism for dealing with fuel poverty. And, with colder temperatures and reduced service use significantly correlated with poorer health and social mobility outcomes1, rationing risks high long-term costs for individuals, families, and wider society.
This year, the Scottish Fuel Poverty Advisory Panel co-funded research into self-rationing behaviours.2 This was undertaken to gain a better understanding of the scale and distribution of self-rationing in Scotland, with two University of Edinburgh Researchers reviewing existing evidence and conducting interviews with key advice agencies, housing associations, and energy companies.
The findings highlight that the groups more likely to undertake self-rationing behaviours, include:
- the elderly
- single occupant households
- families with two or more children
- households with no central heating
- households with average incomes affected by rapid increases in the cost-of-living
- those on low or precarious incomes and not in receipt of benefits.
Self-rationing was perceived as more prevalent amongst rural households, affecting those without mains gas supplies (often reliant on bulk fuel deliveries), but also those on pre-payment meters, which exist in households across the urban-rural divide.
Long-term, consistently high, volatile, or rising energy prices were seen to increase the likelihood of energy service rationing, increasing demands for additional financial support and demand for referrals to energy advice services, with implications for staffing levels.
Self-rationing also carries implications for mental and physical health (and follow on pressures on the National Health Service) and restricted educational access and attainment. Moreover, it was seen to decrease building quality, increase energy debt, lead to poor occupant safety, and increase pressures on supporting services, including but not limited to, Housing Associations and advice agencies.
Researchers identified cross-sectoral recommendations applicable to a range of organisations, including both the UK and Scottish Governments, to help tackle the problems identified, as outlined below:
- Ensure accessible, reliably funded advisory services for households in need of support with their energy payments.
- Make sure available support is (a) well promoted; (b) easy to access; and (c) and prioritises vulnerable populations, inefficient buildings and/or homes without mains gas.
- Adopt a carrot and stick approach whereby the Government provides financial incentives to improve household energy efficiency, whilst simultaneously introducing legislation to ensure a minimum energy efficiency standard in the private housing sector (akin to the standards for social housing).
- Improve the behaviour of the energy sector by working towards stronger consumer protections and developing a social energy tariff as part of a wider package of energy market reforms.
- Commission further research that would monitor the impact of the cost-of-living crisis on energy consumers in Scotland.
Some of these recommendations resonate with the Panel’s recent advice to Scottish Ministers on alleviating the impact of escalating energy prices. We remain focused on providing advice and scrutiny on how policies and programmes are addressing the affordability of energy to ensure the support is there for people in, or those entering, fuel poverty.
1 Scottish Fuel Poverty Definition Review Panel (2017). Available here: A New Definition of Fuel Poverty in Scotland: A Review of Recent Evidence (www.gov.scot)
2 The report is the outcome of joint funding by the Fuel and Transport Poverty in the UK’s Energy Transition (FAIR) grant from the Centre for Research into Energy Demand Solutions (CREDS) and the Scottish Fuel Poverty Advisory Panel (SFPAP). Interviews and desk-based research were conducted by Miss Juliane Müller, former MSc student at the University of Edinburgh, with oversight from Dr Kirsten Jenkins, Senior Lecturer in Energy, Environment and Society at the University of Edinburgh and a member of SFPAP.