Fuel poor could miss out on energy bill discount because of funding limits

Low income households may miss out on a £120 discount off their energy bills this winter because of limits to funding.

More than half a million low income pensioner households will get the Warm Home Discount automatically this winter, as part of a government scheme to help fuel poverty.

But other households eligible for the scheme may miss out on the rebate because of caps imposed by energy firms.

Speaking on the BBC Breakfast programme today, Energy Minister Greg Barker called for all energy firms to provide the discount to eligible customers. 

The BBC reported over the weekend that some suppliers, including nPower and Scottish & Southern Energy, were unable to guarantee that all eligible customers would get the rebate.

Who is eligible?

Older people who pay their own bills and receive the Pension Credit Guarantee will automatically get the £120 annual discount off their bills.

If your household qualifies you will receive a confirmation letter from the Government this winter.

The Warm Home Discount also replaces current social tariffs provided by energy firms to help those households on lower incomes – but those customers must qualify for the discount under different criteria.

These are typically households on means tested benefits, including income support and jobseeker’s allowance, who also have a young child under five or a disabled person in the family.

Some firms are not able to guarantee all of these customers a discount.

Why is there a limit?

Energy firms are able to decide how many customers they will offer the discount to.

The big six suppliers, as well as other firms involved in the scheme, set out their own levels of criteria and decide how to contact customers.  (For a full list of firms taking part in the scheme please see the Department of Energy and Climate Change website.)

The scheme, which is in its first year, is expected to help 600,000 low income pensioners, while only 26,000 low income families are expected to benefit, according to the government.

Scottish and Southern Energy told the BBC it would help a minimum of 4,800 customers, although it expected to be able to help more.

nPower said that it will help as many customers as possible but cannot commit to helping everyone. It said it would watch the progress of the scheme to reassess how it will help. Customers can also check their eligibility online.

EDF has set a limit of helping 40,000 to 45,000 customers, although a spokesman said that it did not expect to reach this limit.

Missing out: Not all energy firms have guaranteed that all eligible customers will get the discount.Missing out: Not all energy firms have guaranteed that all eligible customers will get the discount.

However, British Gas said it would not be placing a limit on the number of customers it will be helping and has a broader set of criteria than the other companies.

Customers who think they may be eligible because of low income should contact their energy supplier to see if they are eligible.

Jonathan Stearn of Consumer Focus, said: ‘Currently less than one in thirty people from the broader group are likely to be helped by the Warm Home Discount this year. That is worrying as it includes many of the most vulnerable families and disabled people, who will be struggling to afford higher energy bills this winter.

‘If energy firms are able to offer help to more people, as British Gas has said it will be doing, this would clearly be good news. It is welcome that the Minister has said he will be putting pressure on other firms to follow suit, as consumers need all the help they can get to make ends meet.

‘But there is also a wider issue of how to fund helping more vulnerable households and lifting them out of fuel poverty. We need a comprehensive fuel poverty strategy which looks at how best revenues from measures such as the carbon floor price can be used to address problems with energy efficiency and fuel poverty.’