Image source, Getty Images
By Tom Espiner
Business reporter, BBC News
Vulnerable households face an “inevitable new winter crisis” without more help on energy bills, a group of MPs has said.
They called on the government, regulator Ofgem, and energy suppliers to take urgent action.
People are being squeezed by cost of living pressures and debt, the MPs on the Commons select committee added.
Industry group Energy UK said suppliers had been increasing support at “a very difficult time for its customers”.
In a report, the MPs on the Energy Security and Net Zero Committee said that the government had provided “unprecedented levels of support” last year when it stepped in to help with soaring energy bills.
But they are now concerned that no new help has been announced for this winter.
In addition, last year £440m of support intended for vulnerable families went unallocated, and was returned to the Treasury. Households who missed out on the Energy Bills Support Scheme should get their payment, the MPs said.
Suppliers and Ofgem should make sure customers get more “time, attention and support”, they added.
Angus MacNeil, the chair of the committee, said: “The nights are now drawing in and many of our most vulnerable people will be haunted by harrowing memories of the relentless sacrifices they were forced into last year, just to keep their heads above water in the face of exorbitant energy costs.”
He said a quarter of those people still carry energy debts, and an announcement of more help from the government was “long overdue”.
The committee said the government should extend the Warm Home Discount scheme, which gives a £150 one-off discount on energy bills, and it called on Ofgem to make sure suppliers give vulnerable customers “more time, attention and support”.
Mr MacNeil said that energy firms needed to make “a drastic improvement in customer service and empathy” for people facing tough times.
He added that “unfair and regressive standing charges” should go. “After all you don’t pay a standing charge to buy petrol, you just pay for what you use,” he said.
Nearly all consumer energy bills include a standing charge, which is a fixed daily payment covering the costs of supply and other levies.
Ofgem said its first priority was to protect customers, adding there are rules in place requiring suppliers to be “proactive in identifying those who might be struggling and providing appropriate advice and support”.
Suppliers should treat customers with compassion, an Ofgem spokesperson said, adding that it was keeping standing charges under review.
Energy UK said suppliers had increased support “during a very difficult time for its customers over the last 18 months”.
This includes “emergency credit, offers of payment holidays and altered repayment arrangements”.
Customers may also be able to get direct financial assistance through suppliers’ funds, “which are often run in partnership with charities and consumer groups who can also offer specialist support and advice”, a spokesperson said.
“An extended period of record bills has seen an unprecedented number of customers seeking support with call volumes quadrupling and an accompanying increase in the time taken to resolve challenging and complex cases,” the spokesperson added.
So energy firms have expanded customer service teams and set up specialist teams “to deal with the most challenging cases”.
“Suppliers will continue to do all they can to support customers struggling with bills but in the middle of a wider cost-of-living and affordability crisis, they alone cannot provide all the help people need,” the spokesperson said.
Mark Garnier, who is also on the MP committee, said that while the government “did step up to the plate last year” it now “needs to give some assurances on support to vulnerable households”.
Image source, monkeybusinessimages
Energy prices at present are limited for a typical household to £1,923 a year – that is the latest Ofgem price cap.
The cap is on the price per unit of energy, so bills for individual households can still go above that, depending on how much energy is used.
The energy price cap is lower than last year, but government support has also been scaled back.
Last winter, household energy bills were limited to £2,500 under the government’s Energy Price Guarantee Scheme.
In addition, all homes got a £400 payment to help with energy bills.
The Energy Price Guarantee is in place until the end of March, but will only come into effect if energy prices go above £3,000 a year.
In response to the Committee’s report, a Department for Energy Security and Net Zero spokesperson said:
“The Energy Price Guarantee will remain in place to protect people until April next year – part of nearly £40bn of support to cover around half a typical household bill.”
People most in need can get support through the Warm Home Discount, and the government’s £1bn Great British Insulation Scheme, the spokesperson said.
In addition, “landlords must respond swiftly when dealing with damp and mould to ensure renters can live in safe and decent housing”, the spokesperson said.
The government is to introduce a law to set time limits on social landlords to make repairs, after the death of two-year-old Awaab Ishak from a respiratory condition caused by mould.