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Tag Archives: Energy Costs
London Arts Theatres start energy collective purchasing deal
20 April 2012: Regular energy for london read, The Stage, has highlighted how the “National Theatre, the Royal Opera House and the Royal Albert Hall have clubbed together to form an energy-buying collective that will enable them to purchase electricity at lower rates. The scheme, called Arts Basket, is being run by energy consultancy Power Efficiency. The group is also inviting other theatres and arts venues to join the initiative.“ Read the full article here. Further information on the Arts Basket – which is an initiative launched by Balfour Beatty company Power Efficiency – can be found here.
Put the over-75s on lowest energy tariff, urge Tower Hamlets councillors
April 2012: From the East London Advertiser “Eight-out-of-10 pensioners in London’s deprived East End are paying too much for their gas and electricity, according to Tower Hamlets councillors. Now Labour members on the council are backing a national campaign for companies to put those over 75 on the cheapest tariff—by law.
“Cllr Rachael Saunders, Labour’s Adult Care spokesperson, said: “It’s no surprise that 80 per cent are paying over the odds with 400 tariffs on offer. “This rip-off must end—the big energy companies must make sure those over 75 are on the cheapest deal.” Nearly 8,000 in Tower Hamlets are paying £200 a year more than they need to, according to estimates. Labour is calling on the Government to legislate for energy companies to put the over-75s on the lowest tariff automatically.”
‘45% of People in London Worry they can’t afford their next fuel bill’
16 January 2012: “45% of people in London are worried they can’t afford their next fuel bill and one in two say energy bills will put a strain on their finances this year, according to new figures released today from Citizens Advice at the start of its Big Energy Week which will help people save money on their fuel bills.
Boris Johnson, the Mayor of London said: ‘We know that many people are deeply concerned about keeping warm this winter and Big Energy Week is a great way to find out how they can cut their fuel bills. In London we have been working with Citizen’s Advice Bureau and other organisations on my fourth ‘Know Your Rights Campaign’ to help thousands of vulnerable Londoners to keep their homes insulated and warm. In addition, 24,000 homes across the capital have had an energy makeover, through my RENEW partnership homes programme, increasing efficiency and helping to drive down fuel bills.
Big Energy Week (16-21 January 2012) will see advisers across the region help people spend less on heating and powering their home – including events in Westfield Shepherds Bush, Richmond and Harrow. The Week is supported by Consumer Focus, Which?, Energy UK, energy companies, charities, accredited switching sites, Ofgem and the Government.”
Read the full news release here. Further details of all London events at www.bigenergyweek.org.uk
Winter Fuel Payments Data for London
September 2011: The latest official statistics on Winter Fuel Payments for 2010/11 have just been released by the Department for Work and Pensions (DWP). The Winter Fuel Payment is “a tax free payment to help older people keep warm during winter” (further information here and here). The data is provided in spreadsheet format on a Parliamentary constituency and local authority basis.
A quick analysis of the key statistics shows for London that:
- 1.14 million people in London (out of 12.71m receiving payments across the UK) received Winter Fuel Payments
- A total of £261 million in WFP was directed to Londoners (out of £2.75 billion across the UK)
- 867,130 households – approximately 27 per cent of London’s households received support (out of 9.2 million eligible housholds across UK).
As part of the Chancellor’s 2011 Budget, the WFP rates are to be reduced this year. Individuals over 60 and aged up to 79 will get now £200, down from £250. And those with someone aged 80 or over get £300, down from £400. Full WFP rates information is here.
Londoners face increased energy bills as EDF raises gas and electricity prices
15 September 2011: The Evening Standard reports on EDF Energy’s increase today in its gas and electricity tariffs: “Hundreds of thousands of London families are facing energy bill increases after the last of the “big six” suppliers said prices will go up by
15.4 per cent in November.” To be totally accurate – standard residential electricity prices are to rise by 0n average of 4.5 per cent (EDF say this “is in line with inflation only and significantly less than rises by other major suppliers” and it is in fact residential gas prices which will rise by 15.4 per cent – again – EDF say “lower than all other major suppliers.”
The exact number of homes in London supplied by EDF Energy is not in the public domain, but as the successor company to London Electricity, the main energy supply business for London post privatisation (and despite a fully competitive energy market) it remains the dominant player in the capital.
EDF states in its own press release that it “continues to be the cheapest dual fuel supplier nationally after limiting its price rises to the lowest level of all major suppliers.” A comparison of tariff rates compared with the other major energy companies is supplied on the press release.
The number of fuel poor households in London
August 2011: A number of announcements have been made recently in relation to the increasing numbers of households suffering from fuel poverty. A summary of this information follows below, along with its relevancy to London.
The Government’s latest fuel poverty estimates for the UK (based on 2009 data) were published last month (DECC press release) and set out the significant increase in the number of households now classed as fuel poor as a result of increasing fuel prices. The Annual report on fuel poverty statistics 2011 stated that “In 2009, the number of fuel poor households in the UK was estimated at around 5.5 million, a rise of around 1 million when compared to 2008, and representing approximately 21 per cent of all UK households.”
Regional analysis of the data in the Annual report (in section 5.9) highlights that the percentage of households in London (under the Government’s definition) that are classed as fuel poor has risen from around 4% in 2004 to around 13% as at 2009 : this equates to around 430,000 households, based on London’s 3.3 million homes.
In response to the Government’s news release fuel poverty charity National Energy Action (NEA) produced a briefing with an estimate for London’s fuel poor based on this 2009 data as 417,000.
This is of course all based on 2009 data as mentioned before. Projections data on a sub-regional basis is not provided in the DECC reports however, in terms of understanding the potential current numbers of Londoners who may be classed as fuel poor, the following should be noted:
- The 2009 data estimates 5.5m UK households are in fuel poverty, of which 4m are in England. In terms of projections, the Annual Report (p75 and76) states that “fuel poverty is projected to remain at around 4.0 million households in England in 2010 and rise slightly to 4.1m in 2011, as the 2011 price changes begin to impact on households.”
- The fact that figures for 2009 and 2010 remain static may seem odd at first, but when looking at gas and electricity price changes over the past few years (DECC’s Quarterly Energy Prices June 2011 provides the latest data – Chart 2.1.2.) it can be seen that the most significant prices increases were between 2007 and 2009, hence that period would have seen the most dramatic increase in fuel poor households. In contrast the Quarterly Energy Statistics report that “Annual average domestic electricity prices, including VAT, fell by 5.2 per cent in real terms between 2009 and 2010. Domestic gas prices, including VAT, fell by 8.6 per cent in real terms during the same period.“
- However things have changed again. All six main energy suppliers increased tariffs earlier this year, and there are expectations of yet further price increases in the near future. Other contributing factors that need to be considered include the reduction in funding by Government to programmes such as Warm Front and Decent Homes.
- As a consequence of these various pressures, the Chairman of the Government’s Fuel Poverty Advisory Group (FPAG) was interviewed on Channel 4 last week and said that DECC’s projections were significant underestimates and that “ in relation to 2011 “We’re looking at 6.6m households in the UK in fuel poverty by the end of this year…”. Of these, FPAG estimate that England will have 5.1m fuel poor compared to the 4.1m estimate in the Annual report.
- On a simplistic linear relationship between the regional estimates for 2009 data (using the NEA number for London), this could mean that there could be 500,400 fuel poor in London by the end of the year.
- All of these numbers are based on the Government’s definition of fuel poverty which is defined as the number of households needing to spend more than 10% of their income on fuel to maintain reasonable warmth . However, London has long made the case that because of the disproportionately high costs of housing in the capital, this 10% proportion should be applied on income AFTER housing costs are taken into account (see GLA Fuel Poverty in London Report for further information). This, along with other factors considered in the GLA study, mean that under conventional estimates, the number of fuel poor households in London are currently grossly underestimated.
Additional information published alongside the Annual Report includes:
Fuel poverty 2009: detailed tables
Fuel poverty monitoring indicators 2011 – provides only scant detail in relation to any specific issues related to London.
Trends in fuel poverty England: 2003 to 2009 – London data in Table 37
EDF 4 year deal to supply electricity to Whitehall departments
August 2011: “French nuclear energy giant EDF has beaten off rivals here to win Britain’s biggest electricity supply contract, worth £6.8 billion, to supply the Government for the next four years. The deal, negotiated by the Cabinet Office in just three months, involves supplying all Whitehall departments with cheap electricity from April 2012. It also provides for supplying thousands of public buildings across England and Wales, including hospitals, police stations, defence sites, London Underground and the British Museum.” From thisismoney.co.uk – click on link to read full article.
In their press release EDF Energy highlight that “As well as electricity supply, EDF Energy will provide strategic and practical sustainability advice to help Government departments use energy more efficiently and reduce emissions.”
LU is one of the largest electricity users in the UK (annual consumption of around 1TWh of electricity). London Assembly Member Mike Tuffrey recently wrote on using the purchasing power of the London Underground electricity contract to support the greater use of renewable energy.
London Energy Prices
4 July 2011: DECC have just published their latest data sets on UK energy prices(PDF report and tables also available in spreadsheet format), which includes a regional breakdown of gas and electricity prices for domestic and non-domestic consumers. London’s statistics reveal that:
- London ranks second lowest in terms of paying electricity bills by direct debit, hence missing out savings offered by suppliers, as direct debit payment typically attracts suppliers cheapest tariffs (Table 2.4.2)
- The average annual London electricity bill is £435 (which is also by coincedence the average for the UK). Bills are calculated assuming an annual consumption of 3,300 kWh (see Ofgem’s Typical Domestic Energy Consumption Figures factsheet for further information). The question does arise whether such a consumption figure is suitable for London with its higher levels of flatted accommodation…If the consumption figure were lower, it is possible that electricity bills were actually higher for Londoners than reported by DECC
- The average annual London gas bill is £687 (slightly above the UK average of £681). This based on an annual consumption of 18,000 kWh.
Explaining Energy Costs
June 2011: Industry trade association, Energy UK, two-page factsheet providing a brief explanation of the elements that go up to make up electricity and gas unit prices.
Institute of Fiscal Studies Winter Fuel Payments Research
8 June 2011: Two papers published today (link to press release) by the Institute for Fiscal Studies show that:
- Households receiving the winter fuel payment are almost 14 times as likely to spend the money on fuel than would have been the case had their incomes been increased in other ways;
- But in very cold weather it remains the case that the poorest pensioners cut back on spending on food to finance the additional cost of heating their homes.
IFS reports Cash by any other name? Evidence on labelling from the UK Winter Fuel Payment and Is there a “heat or eat” trade-off in the UK?
Is there a “heat or eat” trade-off in the UK?
8 June 2011: Institute for Fiscal Studies (IFS) research presents detailed household level expenditure data from older households merged with historical local weather information. The report looks to test “whether there is a a heat or eat trade off: do households cut back on food spending to finance the additional cost of keeping warm during cold shocks? We find evidence that the poorest of older households are unable to smooth spending over the worst temperature shocks.”
Missing the Mark – consumers, energy bill, annual statements and behaviour change
7 June 2011: A new report from the Consumer Focus entitled ‘Missing the Mark – consumers, energy bill, annual statements and behaviour change’ (see bottom of page for link). This looks at the role of information on consumers’ bills and annual statements and the potential this has to help consumers. The research identifies a number of limitations in the effectiveness of this information in nudging behavioural change in consumers.