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Fuel Poverty Overview

For many people across Scotland, winter is a time when they worry most about being able to pay their fuel bills to keep warm at home. But even with a change of season, the problem doesn’t go away. Fuel poverty is an everyday reality for many low income and vulnerable households.

Older people, those with disabilities or long term illnesses which keep them at home, low income families with young children, and others on a low income are all especially at risk of fuel poverty. The consequences are misery, discomfort, ill health and debt.
 
Around 900,000 households in Scotland – more than 1 in 3 – are estimated to be in fuel poverty, which means they are unable to afford adequate warmth in the home. In turn, it is now estimated that there are some 7 million fuel poor households in the UK. The usual definition of fuel poverty is the need to spend 10% or more of income to pay for fuel bills. The causes are a combination of poor energy efficiency of the dwelling, low disposable household income and the high price of domestic fuel. The Progress Update on the Fuel Poverty Statement (25 November 2010) states that for every 5% increase in energy prices as many as 46,000 households (2% of households in Scotland) are pushed into fuel poverty.
 
Living in a cold, damp environment can also exacerbate health problems such as asthma and heart conditions. Often people struggling to pay their bills ration their use of energy, perhaps just heating one room or making the choice between cooking a hot meal and turning on a heater. Using appliances such as washing machines and heating water for baths or showers can be a worry too.
 
Fuel poverty is recognised by government and a number of measures are in place to address it. For example, the Housing (Scotland) Act 2001 requires the Scottish Government to eradicate fuel poverty in Scotland, as far as is practicable, by 2016. Local authorities also contribute to meeting this statutory duty.
 
However, it is important to note that of the three main causes of fuel poverty, low disposable household income and the high price of domestic fuel are matters reserved to Westminster, while poor energy efficiency of the home is a matter devolved to Holyrood. The EU also has a role in issuing directives that affect, for example, energy performance and consumer regulation.
 
As a consequence, there is a range of legislation, policy and schemes in operation at European, UK, Scottish and local levels.