Our Work since April 2024

In delivery of our April 2024 to March 2025 workplan, we have met five times in person and nine times online to explore our workplan themes on the fuel poverty funding landscape, rural and remote fuel poverty, heat networks and linkages between fuel poverty and health. We have also worked to advise and influence the Scottish and UK Governments, and Ofgem through direct advice to policy officials, responding to consultations and participating in the Scottish Government’s Social Tariff Working Group and sector conferences.

Themes

In our first formal workplan, covering April 2024 to March 2025, we identified four themes we would explore during the April 2024-March 2025 year. These were:

Understanding funding and how it’s targeted to mitigate fuel poverty.
The systemic impact of rural and remote fuel poverty.
Heat network models and what works for those in fuel poverty.
Opportunities to relieve and prevent fuel poverty through a public health lens.

Our exploration of these themes has served to show, again, how the interlinking nature of the fuel poverty drivers – energy prices, low incomes, energy efficiency of the home and how energy is used in the home – can act to reinforce fuel poverty and the challenge this creates in forming and then delivering policies which work together to make progress in ending current and preventing future fuel poverty.

1. The Fuel Poverty Funding Landscape

Our plan

The fuel poverty funding landscape is complex. Fuel poverty funding comes from different sources, is generated in different ways, and can be targeted at one fuel poverty driver, multiple drivers, or can take the form of crisis funding. The funding can go to individuals directly, to energy companies or to local authorities or third sector organisations who support people in fuel poverty. The evolution of the funding landscape over a number of years, including “in the moment” responses to events/economic conditions, has created a multi-layered system which is hard to navigate. We aimed to map different funding streams, their objectives and where the balance lies between immediate fuel poverty relief and longer-term prevention. In doing this, we planned to explore the following questions:

❖ How much funding has been allocated by governments?

❖ Is the money allocated being spent?

❖ What are key strengths and limitations of funding streams?

❖ Are there gaps in funding?

What we did

Our Analytical Manager carried out a literature review on fuel poverty funding which provides an overview of each fund, spend and budget data where available, along with a summary of different funds’ key strengths and limitations. In addition, a stakeholder roundtable was held on crisis funding. We also had evidence sessions with the Scottish Government’s Area Based Schemes’ Policy Lead, energy suppliers and the third sector at our August 2024 Panel Meeting.

What we concluded

We found that:

The funding landscape is overly complex and can be difficult to access. Eligibility for schemes is not always clear, and application processes can be off putting.
Crisis funding has deep value and is a lifeline to people when they need it most. Crisis funding as it currently exists does not meet demand and more funding is needed. This funding should be part of a holistic support package accompanied by action to tackle the structural issues that cause fuel poverty.
Energy efficiency schemes often operate in isolation. Previously, Area Based Schemes (ABS) and Energy Company Obligation (ECO) funding could be blended. This is no longer the case, and there is a lack of flexibility to combine and share funding across energy efficiency schemes operating in Scotland. This can ultimately lead to schemes competing with each other, and/or the emergence of a disparate funding landscape that undermines value for money and optimal impact.
There is a need for better targeting of fuel poverty funding across crisis funding, energy efficiency funds, and winter support schemes.
Funding windows for organisations are too short. 12-month windows do not allow for sufficient and sustainable services or securing best value for money and may restrict expenditure. From an energy efficiency perspective, the stop start nature of schemes mean that supply chains struggle to invest in people and materials in time to meet fund requirements.
Consumer protections are often linked to customer contributions, meaning that if a customer receives energy efficiency measures through a grant, they may not receive consumer protections. This can leave them vulnerable if interventions fail or are not provided to an adequate standard.
Funds are inconsistently evaluated, with some funds not being evaluated at all and others evaluated but without publication.

The findings from the literature review, crisis funding roundtable and evidence sessions have informed a set of funding principles and recommendations which we have put together and shared with Scottish and UK Ministers – publishing these in the lead up to the draft Scottish budget announcement in December 2024. We also used these findings in our engagement response ahead of the Scottish Government’s preparation of its first Periodic Report. Our funding principles and recommendations cover the need for holistic, better targeted and consolidated fuel poverty funding with improved accessibility informed by those with lived experience and those who support them. We have made specific recommendations to the Scottish Government – at both a tactical and strategic level.

2. The Systemic Impact of Rural and Remote Fuel Poverty

Our plan

Rural homes experience the highest levels of fuel poverty in Scotland. The evidence shows that rural homes are often harder to heat, have less (or no) access to the gas-grid, higher levels of electricity consumption, dependence on unregulated fuels and/or old meter types with barriers to replacing them. Rural communities also, on average, have higher levels of energy debt. Island and other coastal communities also face the challenge of exposure to high winds and driving rain with its harmful effect on heating efficiency and the fabric of homes. There are some promising models of how community-focussed renewable energy generation in rural Scotland can help to mitigate fuel poverty, but the experience of most communities is that they play host to renewables while paying more to heat their homes. In our plan, we aimed to explore the following questions:

❖ How does metering work for those living in fuel poverty?

❖ Has anything changed since Changeworks published its seminal report last year offering solutions to rural poverty?

❖ What could change which would immediately have positive impact on those in fuel poverty?

What we did

Our Analytical Manager carried out a literature review on rural and remote fuel poverty which looked at energy usage, metering, debt and the transition to net zero. Although we didn’t manage to visit na h-Eileanan Siar (the Western Isles) to hear in person about rural fuel poverty issues in one of most fuel poor areas of Scotland, Matthew Cole (our Chairing Member) interviewed Kirsty MacLeod, Energy Advice Manager at Tighean Innse Gall.

Unsurprisingly, discussion of metering highlighted extreme concern around the switch off, at the end of this June, of the radio teleswitch service (RTS) with uncertainty over whether RTS meters will continue to work, and if they do, whether they will function normally or not[4]. As the rollout of smart meters, which should normally replace RTS ones, is lagging behind in Scotland and there are connectivity issues in rural areas, which have a preponderance of RTS meters, those in rural areas are most likely to be adversely affected. We have drawn attention to this in the literature review on rural and remote fuel poverty and in our response to Ofgem on their Radio Teleswitch Service (RTS) Electricity Supply Licence changes’ consultation.

What we concluded

We concluded that a bespoke approach to the structural disadvantage suffered by rural and remote areas is needed to tackle the fuel poverty these communities experience – the highest in Scotland. Rural fuel poverty in remote and island communities is uniquely challenging in Scotland and it is vital that the structural disadvantage of this rurality is recognised. We think that:

This will require increased investment, including bringing in non-governmental funding. It will need a clear, focus-solutioned strategy and delivery plan to (at least):
Improve the energy efficiency of homes as well as to build new energy efficient homes whilst recognising the higher infrastructure costs to achieve this.
Core funding for, and expanded, locally delivered energy advice services.
Regulation of alternative fuel sources to manage price volatility.
Scalable models for maximising local energy generation benefits.

3. Heat Network Models and what Works for Those in Fuel Poverty

Our plan

We have a keen interest in heat networks primarily because of the potential they may offer to alleviate and protect from fuel poverty but also because, in our scrutiny capacity, we are a statutory consultee on aspects of heat network regulations relating to guidance in the consenting provisions and the guidance on heat network zoning in the Heat Networks (Scotland) Act 2021. We explored the following questions:

❖ What heat network models work best for those in fuel poverty?

❖ Can community benefits be used to take forward heat networks for the benefit of those in fuel poverty?

❖ What does good practice look like for fuel poverty-alleviating heat networks and what role can local authorities and the Scottish Government play in fostering these?

What we did

We held a roundtable with legislative, regulatory, and local authority stakeholders to explore the opportunities and challenges which heat networks present for those in, or at risk of, fuel poverty.

We also offered some early feedback to Scottish Government Heat Network Policy Leads on the draft fuel poverty statement, which is to be included in the guidance for the consenting regulations.

What we concluded

Following this instructive and useful roundtable, our view is that:

Heat Networks will make an important contribution to decarbonising heat in homes but there is currently little evidence to suggest that decarbonised heat networks will have a positive impact on reducing levels of fuel poverty.
There is potential for heat networks to have a detrimental impact on levels of fuel poverty and those experiencing fuel poverty, unless:
Energy market reforms are expedited to ensure that electricity prices are reduced.
Regulatory regimes give vulnerable heat network energy consumers, at the very least, equivalent protections to those given to vulnerable energy consumers, including price controls.
Delivery models have an appropriate scale and significant public ownership or investment as well as offering the potential for community benefits.
There is some evidence of policy disconnect/dilution – for example, the dissonance between promoting both heat pumps (for individual) households and heat networks (for many households) in an area zoned for heat networks.

We will engage on the Scottish Government’s revised Heat in Buildings Bill when it is introduced later this year focusing particularly on its potentially increased focus on heat networks.

4. Fuel Poverty through a Public Health Lens

Our plan

We are very interested in exploring a public health approach to fuel poverty and during previous evidence sessions have heard much about the negative physical, mental and wellbeing impacts of living in cold homes and the systemic impact living in fuel poverty has on people’s lives. We therefore committed to engaging with other public bodies, health services and the wider stakeholder community, to begin to explore:

❖ The links between fuel poverty and health – building on our previous conversations.

❖ The public health outcomes of social prescribing initiatives, such as Warm Homes Prescription, modelled by Catapult Energy Systems, and potentially where social prescribing has been used effectively in other policy areas.

❖ How funding might be re-purposed to alleviate fuel poverty while supporting the sustainability of Health services.

What we did

We visited The University of Edinburgh’s Usher Institute to explore some of the health impacts of fuel poverty. We were hosted at the Institute by Linda Bauld, Professor of Public Health at the University of Edinburgh who is also the Scottish Government’s Chief Social Policy Adviser. We heard from:

Public Health Scotland on what’s known about the impact of cold homes on health in Scotland.
A Consultant in Paediatric Infectious Disease on a research study looking at Homes, Heat and Healthy Kids.
Energy Systems Catapult on their new iteration of the Warm Home Prescription Trial which is focusing on different funding models, including the integration of ECO4 into the Warm Home Prescription service.

What we concluded

This session reinforced our view that there are substantive opportunities to relieve and prevent fuel poverty through taking a public health approach in this case ensuring warm homes. The opportunity also exists to shift from funding treatment of health conditions exacerbated, or caused, by cold, damp homes, to preventative spend – stopping poor health associated with cold and damp homes happening in the first place. The wellbeing social value analysis findings on the impact of the Warm Homes Prescription, that there is a £5.10 return on investment to society for every £1 spent, is striking in the wellbeing, health and financial benefits it posits in moving to a preventative healthcare model of this type.

Scrutiny

We have continued to fulfil our scrutiny role of the Scottish Government’s progress in tackling fuel poverty. We have undertaken a high-level assessment of the Scottish Government’s progress in our reflection ahead of the Scottish Government’s publication of its first Periodic Report, by responding to consultations, and through direct engagement with Scottish Government officials, specifically:

We have offered our reflections ahead of the Scottish Government’s publication of its first Tackling fuel poverty: Periodic Report – setting out our key findings in the following areas: the barriers and challenges which those living in fuel poverty experience in heating their homes to a comfortable temperature for health and wellbeing, Scottish Government actions since 2021 which have helped to mitigate fuel poverty effects particularly for vulnerable households and those in rural areas, and mitigate the impact of the fuel poverty drivers, further action needed by the Scottish Government to reduce fuel poverty, and what barriers exist which make this problematic.
We have supported Scottish Government’s work to develop a monitoring and evaluation framework for its Tackling Fuel Poverty: A Strategic Approach, offering advice on the shaping of the logic model which will underpin the evolving framework and participating in a theory of change stakeholder workshop.

Advocacy and Influence

We have continued to advocate for an energy discount mechanism (also known as a “social tariff”) – taking every opportunity to promote our recommendations. We believe that a well-defined and flexible discount mechanism offers a real opportunity to at the least mitigate and at the best eradicate fuel poverty. We participated in Scottish Ministers’ Social Tariff Working Group – advocating for a discount mechanism automatically delivering a unit rate discount for vulnerable consumers at the point of use, and which is flexible enough to take account of changing circumstances. We have also promoted an energy discount mechanism as a strategic solution to reforming the support given to low income and vulnerable households. For example, we have advocated for the introduction of this mechanism in our responses to Ofgem in its consultation on an energy debt relief scheme and call for input on the future of price protection, also promoting it to the UK Government through our response to their consultations on the expansion of the Warm Home Discount and our response to their consultation on its review of England’s Fuel Poverty Strategy.

Advice

Following up on our response last year to the Scottish Government’s consultation on the shape of the devolved winter fuel payment (WFP) – to be called the Pension Age Winter Heating Payment (PAWHP) – we responded to the Cabinet Secretary for Social Justice’s letter setting out that the Scottish Government’s intention to follow the UK Government in restricting WFP entitlement to those in receipt of Pension Credit and other means-tested benefits from winter 2024-25.[5] In our letter, we reiterated our original advice to repurpose the WFP, as a progressive benefit aimed at all households experiencing fuel poverty, or if this is not possible within the existing regulatory framework, for the Scottish Government to consider targeting PAWHP to those on Pension Credit, aligning with the Winter Heating Payment and treating it as taxable income.

We offered our advice to policy leads on the Warmer Homes Scotland (WHS) eligibility criteria, setting out that:
As we have identified more investment is needed to aid progress in meeting Scotland’s fuel poverty targets, containing the WHS funding demand through narrowing eligibility does not seem like the right approach. Even if the demand then outstrips the funding available: evidence of demand can only add weight to the business case for more budget to be allocated next year – setting a benchmark for future budget allocations.
There seems to be a lack of alignment between the criteria and the (then) Heat in in Building Bill (HiBB) proposals around linking energy efficiency standards to a series of measures to the EPC rating in the criteria, and HiBB seems to be moving away from the “fabric first” principle while WHS seems to be remaining aligned to “fabric first”.
We offered the Poverty and Inequality Commission some fuel poverty research insights for their annual scrutiny report on the Scottish Government’s progress on the implementation of the Tackling Child Poverty Delivery Plan.

Collaboration and Engagement

In delivering our April 2024-March 2025 workplan, we have sought to engage with and listen to those with lived experience of fuel poverty, with central and local government, parliamentary committees, third sector organisations, the regulator, and players in the energy sector, and also other public bodies where there is a connected interest in fuel poverty and its effects. Our work set out above and below demonstrates the breadth of our engagement and commitment across the fuel poverty stakeholder landscape.

We have made a particular effort to strengthen our engagement with Ofgem by responding to their consultations and inviting them to our Heat Networks’ Roundtable.

We place a huge value on the contribution of the third sector in mitigating and protecting those in fuel poverty. We attended supported Energy Action Scotland’s 2024 Conference and our Chairing Member participated in the Scottish Federation of Housing Associations’ Energy and Net Zero Conference in November 2024, where he talked to the drivers of fuel poverty and the actions needed to ensure that all Scottish households are able to access affordable warmth.

Research

Research is a central and ongoing focus for us. In the first and second quarters of 2024/25 we focused on the fuel poverty funding landscape, with our Analytical Manager producing a review of available funding and chairing a roundtable on crisis funding. Both of these pieces of analysis informed and were published alongside the Panel’s principles and recommendations on the fuel poverty funding landscape in November 2024.

Rural and remote fuel poverty has also been a central research focus for the Panel this year. The Analytical Manager undertook a literature review focused on summarising recommendations from key reports; energy usage in rural and remote Scotland; metering; debt, and the transition to net zero. In line with our commitment to ensure that their work is informed by those with lived experience of fuel poverty, we commissioned Scarf, ALIenergy and Tighean Innse Gall to undertake focus groups on topics relevant to rural and remote fuel poverty. The findings from this research was published in June 2025.

We continue to foster connections with academic institutions. This year, Panel members provided external supervisory oversight on two MSc student dissertations on fuel poverty related topics, as well as engaging in interviews and requests for support from postgraduate and an undergraduate student.

Governance

We published our first annual report (January 2022 to March 2024) covering the first two years of our operation in June 2024.
We have continued to develop our risk management approach.
We have worked with the Scottish Government to produce a succession plan informed by our strategic goals and skills’ matrix in order to support Scottish Ministers in their next appointment round for the Panel.

Monitoring the Success of our Strategic Plan

In our Strategic Plan 2024-2027, we set out how we would produce annual workplans, rooted in the areas for action set out in our strategic plan and assess in our annual reports how effectively we are delivering on our strategic goals. Alongside our Strategic Plan, we produced and published a logic model – a visual representation of how we expect our strategic goals (inputs) to be achieved (outcomes) through our work (outputs), to accompany our Strategic Plan. Indicators continue to be developed to evaluate the effectiveness of our Strategic Plan and delivery by assessing the effectiveness of our workplans. In the absence of a complete set of indicators, selected data is provided below to give a snapshot of Panel progress in the last full workplan year April 2024 to March 25:

In terms of the Panel’s website, there were 12,000 active users, an increase of 168% on 2023/24. There were 5,900 engaged sessions, an increase of 73.1% on 2023/24.
The Panel had 10 media interactions and mentions, including from BBC Scotland and LBC Radio.
The Panel were invited to participate in 11 key groups, roundtables, and evidence sessions across the public sector, third sector organisations, and wider energy sector and regulator groups.
The Panel and Secretariat met with 6 stakeholders to discuss their Annual Report and Workplan.