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Government responds to uSwitch energy debt report

Advice from energy minister as millions of households fall into debt to their energy supplier

man shocked at energy billThe government has responded to uSwitch’s recent report on the energy debt of UK consumers, which revealed that around five million UK households are currently debt to their energy supplier.

Over the past year, the amount owed to energy providers has increased by £159 million to reach £637 million, which has led to calls for the coalition to do more to help people in fuel poverty whose situations are only going to deteriorate in the months ahead.

In response, Greg Barker, the Minister for Energy and Climate Change, has issued advice to consumers that can help them keep on top of payments, reduce energy wastage and even benefit from subsidies toward their energy bills.

“We know many consumers are really feeling the pinch due to rising energy prices and the very cold winter. Anyone worried about paying their bills or staying warm can call the Home Heat Helpline on 0800 336699,” he recommended.

The Home Heat Helpline is a freephone service that advises and assists those worried about paying their energy bills and keeping warm during the winter and also offers assistance to low-income households in urgent need of heating help and advice.

Help is at hand

The organisation issued its own response to uSwitch’s energy debt report, explaining that the free, impartial and independent service is designed to ensure people get all the help they need with energy bills.

“Energy companies offer discounts, rebates and help with insulation and other energy efficiency measures to those customers who need it most. Call today to check you’re claiming all you’re entitled to,” the helpline noted.

According to Mr Barker, consumers should explore all options open to them, as well as follow practical steps such as taking regular meter readings and checking that they are getting the best possible tariff from their energy supplier.

In addition, the introduction of initiatives such as the Energy Company Obligation will also help to protect consumers by creating a legal obligation on energy suppliers to improve the energy efficiency of households.

This is implemented through three distinct targets, including the Carbon Emissions Reduction Obligation, which focuses on hard to treat homes and measures that cannot be fully funded through the Green Deal.

Meanwhile, the the Carbon Saving Community Obligation centres on the provision of insulation measures and connections to district heating systems to domestic energy users that live within an area of low income.

Perhaps the most helpful target for vulnerable consumers is the Home Heating Cost Reduction Obligation, which requires energy suppliers to provide measures which improve the ability of low income and vulnerable households to affordably heat their homes.

A range of initiatives

Other government initiatives can also shield people from the cold and the threat of rising bills that cannot be paid, according to the energy and climate change minister.

Mr Barker explained: “The government has put in place help for households struggling with energy bills. Two million households will get help under the Warm Home Discount Scheme this year, including more than one million low income pensioners who will receive £130 off their bill.

“Winter Fuel Payments and Cold Weather Payments are also available to vulnerable households and the Green Deal is up and running to help more people install energy efficiency measures.”

Winter Fuel Payments offer between £100 and £300 tax-free to help people born on or before July 5th 1951 to pay their heating bills, with payments made automatically between November and December.

Most people should receive a Winter Fuel Payment automatically if they get the State Pension or another social security benefit but those who don’t qualify can make a claim here.

Under the Cold Weather Payment initiative, people on certain benefits receive a payment of £25 for each seven-day period of very cold weather between November 1st and March 31st.

 The grass may be greener

The Green Deal, meanwhile, has received the support of many campaigners and industry analysts, with Ann Robinson, Director of Consumer Policy at uSwitch, saying it can help to keep a lid on energy costs.

“There are two simple ways to limit costs – use less energy by making our homes more energy efficient, perhaps by taking advantage of the Green Deal, and paying less for the energy we do use by switching to the most competitive tariff for our needs.”

Paying bills via direct debit can also help to reduce costs as some energy providers offer discounts for doing this, she concluded: “It spreads the cost of energy use evenly throughout the year, so that households can avoid the burden of heavy winter bills.”

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