The Association for Renewable Energy and Clean Technology (REA) has welcomed new measures to try and counter spiralling energy bills, but said the Government must now ramp up installation of insulation and rollout of domestic renewables and clean tech.
The Government’s plan to tackle the cost of living crisis, to be funded in part by a windfall tax of 25% on the profits of oil and gas companies, includes: scrapping the one-off, £200 loan deducted from energy bills to be replaced with a £400 grant; households who receive means tested benefits being given a one off payment £650; increasing the winter fuel allowance for pensioners to £300 from £150; and £150 extra for those receiving non-means tested disability benefits.
The REA repeatedly called for support for households facing increasing bills as part of the trade association’s six point plan to tackle the energy crisis. The removal of VAT on domestic renewable and clean technologies was also part of the six point plan and introduced in the Chancellor’s Spring Statement in March.
While the package announced today may bring some immediate relief to household bills, the REA says this will only be temporary as inflation continues to rise. Ofgem said on Tuesday the energy price cap would increase to £2,800 in October, an increase of £800, after the regulator already increased it by £693 in April.
The REA is now calling on the Government to lead a ‘national effort’ to increase energy efficiency which includes extending the list of technologies included as Energy Saving Materials, establishing an effective home insulation scheme and delivering an ambitious domestic heat decarbonisation policy.
The REA also reiterated their previous calls for the Government to help accelerate the wider energy transition and remove volatile gas prices from bills permanently.
Dr Nina Skorupska Chief Executive of REA, said:“The REA has long called for Government intervention to reduce the impact of spiralling energy costs and we welcome the support which will now be provided to low income and vulnerable households in particular.
“However, the measures announced today by the Chancellor will only provide temporary and partial relief, with struggling households facing unprecedented inflationary costs that aren’t going away any time soon.
“The Government needs to go much further and, in addition to short term cash, lead a national effort to ensure as many households as possible can insulate their homes and install domestic renewables and clean technology before the winter. This will improve energy efficiency, reduce demand for expensive fossil fuels and prevent damaging exposure to volatile global prices.
“The situation remains critical – the Government has to rapidly follow today’s short-term relief with a package of real substance.”