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Calls for Help with Heating Oil

By Samantha Washington
BBC Radio 4's Money Box

Craig Wood
Craig Wood needs to have his oil tank filled once or twice a year

The government should do more to help some of the one and a half million people who pay for heating oil says the Commission for Rural Communities.

Fuel poverty is over twice as high for people reliant on heating oil as for those on the gas mains according to the Centre for Sustainable Energy.

But the industry remains unregulated.

And while the government acknowledges these concerns, there is no indication that it will bring the industry under the eye of the regulator, Ofgem.

Alternative heating

There are over four million people around the UK not on the gas mains.

These people need alternative energy sources to heat their homes.

You just have to pay for the oil when you need it
Craig Wood of Burton Pedwardine
Some use electricity only, some use Liquid Petroleum gas (LPG), and over one million of them use heating oil.

They are largely based in rural and remote areas.

The price of crude oil hit a record high this year, forcing heating oil and other energy costs up with it.

But while the price of a barrel of oil has fallen by nearly 70%, the price of heating oil has fallen only by about 50%.

And, the way it is bought can make the costs a real problem for people who use it.

Craig Wood lives in a rural hamlet in Lincolnshire called Burton Pedwardine.

He and the other 43 people who live there need to have their oil tanks filled once or twice a year.

"You just have to pay for the oil when you need it.

"It means you have to budget throughout the year or buy oil in small quantities, but if you do that you pay a premium price for it."

Purchasing power

Jack Frost is tapping at the windows of badly heated homes
Richard Burge, Commission for Rural Communities
People around the country using heating oil complain that they do not get the discounts available to customers who have their gas and electricity with the same supplier.

And, they also say the lack of monthly payment plans adds to their difficulties.

Rod Prowse, spokesperson for the Federation of Petroleum Suppliers says those arrangements can be available to those who ask.

"Most distributors have budget plan.

"Some distributors are better than others at communicating what they have to offer.

"If you don't ask, you don't get"

Part of the problem is that people using heating oil are scattered around the country and it is difficult for them to club together to get "purchasing power".

Craig Wood and the other inhabitants of Burton Pedwardine got together and found they could negotiate several pence off a litre.

There are also websites which aim to bring people together from nearby areas allowing them to get some cost savings.

But these initiatives do not reach everyone.

Official help?

Richard Burge from the Commission for Rural Communities says it is the government which needs to step in.

"Jack Frost is tapping at the windows of badly heated homes.

"Those people need access to cheap heating oil before they get cold."

The Department for Climate Change told Money Box that it acknowledged the concern about heating oil costs and pointed out that there was extra help available this winter.

There is no indication from the government or the regulator, Ofgem, that the heating oil industry will soon be regulated.

BBC Radio 4's Money Box was broadcast on Saturday,
13 December 2008 at 1204 GMT.

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