The Government missed its 2020 fuel poverty targets and is already at “high risk” of failing to meet its goals for 2025 as well, according to its own advisers.

In a highly critical report published on Wednesday, the Committee on Fuel Poverty said it was “unacceptable” that the Government had failed to achieve its aim of ensuring all fuel poor homes had an energy efficiency rating of E or higher by 2020 “despite schemes and sufficient funding being able to meet it”.

Only 55% of the 293,000 fuel poor homes with ratings of G or F in 2015 had been upgraded by 2020.

The Government aims to ensure “as many fuel poor households as is reasonable practicable” live in homes with an energy efficiency rating of C or better by 2030. Currently, 88.8% of all low-income households live in a home with a rating of D or better.

The committee, set up in 2015 to advise the Government on tackling fuel poverty, said in its annual report that only 15% of funding to improve energy efficiency and help with fuel bills actually went to households in fuel poverty.

Energy bill and smart meter
The report said only 15% of funding to improve energy efficiency and help with fuel bills went to fuel-poor households (PA)

The report said: “Government failed to apply its own fuel poverty guiding principle to target available funds on assisting those in the deepest levels of fuel poverty to improve the energy efficiency levels of their homes and assist them to pay their fuel bills.

“Instead, assistance was targeted (and continues to be targeted) predominantly on higher income households.”

The warning comes as concerns about energy bills continues to mount thanks to spiralling wholesale gas prices. Regulator Ofgem raised its energy price cap by 12% this month and analysts fear the cap could rise again by nearly 30% in April 2022.

This would mean bills rising by as much as £400, prompting fears more households could be pushed into fuel poverty.

Many of the problems highlighted in Wednesday’s report were originally raised in the committee’s first annual report in 2016.

That report found only 10% of funding for fuel poverty schemes actually went to households in fuel poverty, while the Government did not know the address of the majority of the 3.2 million fuel poor households.

Gas hope
Spiralling wholesale gas prices have sparked concern about rising energy bills (PA)

The 2021 report found the Government still did not have this information, saying: “Although the number of fuel poor households can be estimated… the addresses of these households are unknown and hence it is difficult to target assistance to them.”

The committee also highlighted concerns that the move to net-zero could increase fuel bills in the short term, meaning more support would be necessary, but objected to the diversion of money for energy efficiency into decarbonisation projects.

The report said: “Whilst we understand Government’s commitment to decarbonise heating, it is important to recognise that decarbonisation is not the same as fuel efficiency as it does not necessarily lead to reduced fuel bills.

“We must protest that using budgets originally targeted at energy efficiency for other means will undermine the achievement of the fuel poverty 2025 milestone and 2030 target and our recommendation therefore is that additional resources should be allocated for heat decarbonisation instead.”

Jonny Marshall, senior economist at the Resolution Foundation think tank, said: “Reducing the number of families living in fuel poverty should be the lens through which the Government addresses both the immediate gas price crisis, and future plans to decarbonise our homes as part of the UK’s net-zero transition.

“This should include prioritising low-income families in its imminent Heat and Buildings Strategy, ensuring that support is available to insulate wasteful homes and slash energy bills for families that need it the most, and to insulate households from volatile gas prices by using homegrown renewable energy to stay warm instead.”

Liberal Democrats leader and former energy secretary Sir Ed Davey said: “The Conservatives are failing millions of hard-working families and leaving them in fuel poverty at a time when energy bills are rocketing.

“As a result of this Government’s abysmal failures, people could find themselves unable to heat their homes this winter. With empty shelves in the supermarket and soaring energy bills, the Conservatives are leading us into a winter of discontent.

“The Government needs to step up now and help those struggling to pay their bills. Ministers must expand the Warm Homes Discount now and roll out an emergency programme of home insulation right across the country.”

A spokesperson for the Department for Business, Energy and Industrial Strategy said: “We welcome the Committee on Fuel Poverty’s report, which recognises the significant progress we have made in tackling fuel poverty, with 1.3 million fewer low-income households living in the least energy-efficient homes compared to 2010.

“The energy price cap is shielding millions of customers from rising global gas prices, and we’ve launched an extra £500 million Household Support Fund for those most in need in addition to other schemes for the most vulnerable.

“But we want to go further and faster, ensuring nobody goes cold in their own home. That is why we are investing £1.3 billion to upgrade the energy efficiency of homes helping to lift more low-income families out of fuel poverty.”