Commons to debate rural fuel costs

A briefing note from the Countryside Alliance on the cost of fuel and rural households and communities, prepared in advance of the Westminster Hall debate on 29 March.

Background

• Against the backdrop of spiralling energy costs sparked by Russia's war against Ukraine, the Chancellor of the Exchequer's 'Plan for Growth' statement set out expanded measures to support households with the costs of fuel.
• Plans announced under the previous Government earlier in the year had been criticised for failing to take full account of homes not connected to the gas grid and therefore reliant on alternative fuel sources for heating, which are not covered by Ofgem price caps and are likely to be more expensive. Many such homes are in rural areas.
• According to the latest fuel poverty statistics (based on 2022 data), rural homes have a higher incidence of being off the gas grid – the survey showed 56.8 per cent are off gas grid, compared to just 9.0 per cent of urban properties. Rural homes were also found to be much less energy efficient. Of households living in properties not on the gas grid, 20.1 per cent are fuel poor compared to 12.3 per cent on the gas grid.
• Households living in rural areas had the highest fuel poverty rate of 15.9 per cent in 2022 and the largest fuel poverty gap at £956. This is the additional income which would be needed to bring a household to the point of not being fuel poor. Urban areas, by contrast, had a fuel poverty rate of 11.1% and a fuel poverty gap of less than half that amount.
• The 'Plan for Growth' measures sought to address the situation of these households through targeted support, was given legal effect in the Energy Prices Act 2022.
• In the Budget earlier this month, the Chancellor announced that one of these measures – the Energy Price Guarantee – would be extended for three months, after which prices are expected to start falling.
• Meanwhile, the Government maintains an active proposal to ban the installation of replacement oil boilers from 2026 leaving 1.5 million households needing to find a different way to heat their homes. This will significantly impact those living in rural areas off the gas grid network.

To read the briefing in full, please click here.

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