Poor paying for energy profits

Crippling energy costs hit the poor and elderly as companies cash in on cold weather

Households across the UK are facing record energy bills this month as a result of the recent freezing weather conditions. After one of the coldest Januarys in over 25  years gas and electricity bills are set to rise from an average £156 to £237 – a massive 52 per cent increase, according to official figures, with many people falling further into debt in order to pay.

The extreme weather during the first month of 2010 saw average temperatures slip below 3c with widespread heavy snowfall and sharp frosts across most of the UK. According to the Met Office the minimum temperature recorded was (minus) -22c. The extraordinary weather over the winter period is estimated to have caused a 30 per cent surge in energy consumption, as families and the elderly struggled to cope with the freezing temperatures.

Economically it means the UK’s 27 million households will pay out a total of £6.1 billion on their energy bills for the last month, an increase of £1.89 billion despite the decrease in the cost of fuel. Wholesale gas prices fell by 60 per cent during 2008/9, but the savings have not been passed on to consumers with customer bills being reduced by less than ten per cent. Critics argue that the major energy suppliers are waiting until the summer to bring down prices rather than risk a cut in profits during the peak energy consumption over the winter months.

The UK’s largest energy supplier, British Gas with 15.7million customers, is set for a 50 per cent rise in annual profits to more than £500million, while Scottish and Southern Energy’s profits rose by 36 per cent in the past six months. Thousands of elderly, meanwhile, have been unable to afford to keep warm during the coldest spell in 30 years. One energy expert commented “There is still scope for significant price cuts for both gas and electricity to ease the burden on hard-pressed households. A lot of people, especially the old, poor and vulnerable, were already struggling to pay their bills even before the sharp drop in temperatures and they need help.”

There were 36,700 more deaths among the elderly during winter than in warmer months, according to the Office of National Statistics, up 12,000 on the previous year. At the same time there are millions of pensioners among the 5.4million who are in fuel poverty. The Age Concern and Help the Aged charity condemned the rise in winter deaths, which it links to ‘cash-strapped older people turning down the heating’. Energy watchdog group Consumer Focus commented: ‘All of the suppliers will be enjoying rocketing profits while millions of consumers worry about how to afford to keep warm.’

The windfall for gas and electric companies comes on the back of an the energy regulators Ofgem critical report that found energy suppliers waiting 65 days after putting up prices before informing customers of the increase, leaving many in the dark over the true cost of their energy consumption.

Taken from Freedom

Pensioners left out in the cold

OAPs will be given pittance to stay warm during Britain’s big freeze

Pensioners have been left out in the cold after the government offered a miserable sum of money to heat their homes.

With freezing temperatures across much of Britain and high fuel bills hitting working people and the elderly hardest, the government offered a mere £170 million as a one-off cold-weather payment.

Work and Pensions Minister Helen Goodman tried to reassure pensioners that help was “on the way” and that they should not worry about turning their heating on.

However, National Pensioners Convention (NPC) general secretary Dot Gibson said that payments were not automatic and only available to a lucky few.

“You have to be on means-tested support to qualify, which excludes the vast majority of older people, and you have to endure seven days of freezing temperatures before being able to receive any payment,” she said.

One of the conditions for receiving a payment is that the temperature must be 0 degrees Celsius or less for seven consecutive days.

About 12.3 million older people will receive winter fuel payments between £250 and £400.

The Conservative Party has in the past attacked the government over the whole concept of winter fuel payments, suggesting that they should be scrapped altogether.

Ms Gibson said there was a much more efficient way of ensuring older people get the help they deserve when they need it than a cold-weather payment.

“We would prefer to see the winter fuel allowance that reaches every pensioner household increased to £500 and paid across the board,” she demanded.

“The NPC thinks this is a more effective way of dealing with cold weather and the drop in temperature that we are currently experiencing.”

The government has also been heavily criticised for not exerting enough pressure on private energy companies which have not ruled out price rises.

Ms Gibson said that the NPC “would like to see an industry-wide social tariff where a set amount is paid per measure of energy with a lower amount for more vulnerable people.”

Twenty thousand mainly older people needlessly die from the cold each year, while many more become seriously ill.

According to recent National Housing Federation figures, some seven million households are currently in fuel poverty.

Despite wholesale electricity and gas prices more than halving, fuel bills only fell by a miserly 4 per cent in 2009, averaging £1,239 a year.

Green campaigners also stepped up calls for a “bold” approach to tackle fuel poverty – and in doing so, meet climate change targets for reducing carbon emissions.

WWF Scotland organiser Elizabeth Leighton urged the Scottish government to build on Westminster’s Warm Front scheme in England which offers grants of up to £6,000 for pensioners and single parents on benefits to insulate their homes.

And she insisted: “A bold, local authority-led, street-by-street approach with free loft and cavity wall insulation for all is the most effective means to make all homes low-carbon.”

Taken from Morning Star