Page last updated at 00:43 GMT, Friday, 24 February 2006

Not feeling the heat over fuel price rises

By Stephen Robb
BBC News

Energy price rises have prompted fresh warnings about more Britons shivering into "fuel poverty", with campaigners complaining some people are forced to choose "between heating and eating".

Electric fire
The government aims to eradicate fuel poverty in vulnerable homes
Sixty-five-year-old Pam Greenhalgh, who lives alone in Northwich, Cheshire, admits she "will skip a meal here or there, or have hot drinks sometimes instead of a meal" to make savings.

"As long as I have got my cup of tea, I don't care," she adds stoically.

Fuel poverty is defined as spending more than 10% of income on heating and power.

The problem can be most acute for people paying higher charges through pre-payment meters - like Mrs Greenhalgh.

But she says she would struggle without the meter, which helps her to budget.

"I can build up my credit during the summer, so I can cope with the cold winter. It's better than if I had to worry about the bill coming in.

I have to think twice about putting the heating on for that little bit extra
Pam Greenhalgh
"But I pay more for my electricity and gas this way - you cannot win."

She survives on a state pension and benefits including disability living allowance, which she receives due to numerous ailments including arthritis.

"I have to keep warm," she says. "If I get cold my joints get stiff so I can hardly move, and I get more pain.

"I have [the heating] on a timer - for a few hours in the morning and so many hours at night but obviously, like today, when it's cold, I have to think twice about putting the heating on for that little bit extra.

"Or do I get back in bed and keep warm under the duvet."

Avoidable deaths

William Gillis is chief executive of National Energy Action (NEA), which campaigns to eradicate fuel poverty.

"Some people are forced to make the choice between heating and eating," he says.

"Generally people manage their inability to afford adequate warmth, by just not being warm.

"It means millions of households in the winter months living in temperatures that are not conducive to good health."

Old man by his gas fire
Energy suppliers blame price rises on wholesale price increases
The UK has the highest number of avoidable deaths due to winter cold in Western Europe.

Before the latest prices rises, Age Concern predicted that more than 20,000 people over 65 would die between December 2005 and March 2006 from cold-related illness in the UK.

"It's not just the elderly," Mrs Greenhalgh is quick to point out. "It's people with young families as well that are struggling."

Among children, fuel poverty can lead to educational under-achievement, social exclusion, and physical and psychological ill health, industry watchdog Energywatch has said.

The government has set a target of 2010 to eradicate fuel poverty among the vulnerable - the elderly, households with children, or people who are sick or disabled.

Our priority is to make sure those people that are most affected know what help is available
Department of Trade and Industry spokesman
The NEA estimates there were three million UK households in fuel poverty before this month's price rises, with about half including people aged 60 and over.

The last government estimate, for 2003, put the figure at two million - a Department of Trade and Industry (DTI) spokesman says the latest price rises could see another million homes in England alone in fuel poverty by the end of 2006.

"It's pretty safe to say we aren't going to meet the deadline," the NEA argues.

The DTI spokesman says the government is still aiming to meet the 2010 target, but adds: "With these rising prices, our priority is to make sure those people that are most affected know what help is available."

Huge profit

He points to 2bn-a-year worth of winter fuel payments, UK-wide government grants for vulnerable households to improve heating systems and insulation, and energy advice offered on the Home Heat Helpline.

British Gas blamed the 22% price rise it announced last week on wholesale price increases and a lack of competition in European markets. Other suppliers have also raised prices.

"NEA would like the regulator Ofgem to cast an independent eye over the current round of price rises and give us a view as to whether or not they are justified," says Mr Gillis.

British Gas is doing more than any other supplier to address fuel poverty
Centrica spokesman

However, on the day British Gas-owner Centrica announces a 1.5bn operating profit, Mrs Greenhalgh is in no doubt.

Her power is not supplied by Centrica, but she says: "It infuriates me that they are making such huge profits out of people like me," she says.

"They are just hiking the prices, and all they are doing is lining the bosses' pockets. They don't care about the people."

A spokesman for Centrica said: "Price rises don't necessarily mean more people being pushed into fuel poverty. British Gas is doing more than any other supplier to address fuel poverty.

"There are a number of initiatives in place to offset the impact of a price increase."

He said this would either be through a winter rebate or other initiatives which would "more than offset" the cost of price rises.

It was necessary to look at the "bigger picture", he said.

Profits up at British Gas owner
23 Feb 06 |  Business
Gas rise sparks poverty warning
18 Feb 06 |  Business
British Gas raises prices by 22%
17 Feb 06 |  Business
Fuel poverty to increase in 2006
30 Jan 06 |  Business

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