"Fuel Poverty" caused by rising energy prices could lead to thousands of deaths in England and Wales this winter, according to a report released on Wednesday.
Energy prices are already under close scrutiny, after figures released by Ofgem, the regulator, showed that the profits per customer made by the six largest energy companies in the country had increased by more than 700 per cent since June. The prime minister held a summit with providers and consumer groups on Monday.
Under current definitions, a household suffers from fuel poverty if it spends more than 10 per cent of its income on heating.
Professor John Hills was commissioned by Chris Huhne to examine the factors that lead to fuel poverty and whether the current measure reflects the true scale of the problem. On Wednesday, his report- the Fuel Poverty Review - predicted that spiralling energy bills will exacerbate the annual fuel poverty hardship among low income families.
Hills recommends excluding higher income families who happen to have high energy bills from the definition, so that in future government help can be aimed more precisely at the lower income households.
The Marmot review, an independent report, found that about one-fifth of winter deaths happened in the coldest quarter of homes. From that figure, Hills estimated in his report that 2,700 people die in England and Wales each year because of insufficient heating.
Citizens Advice chief executive Gillian Guy commented that it was "horrifying" that so many people were dying each year. She said that Professor Hills' report was "yet another reminder that fuel costs just have to come down".
Consumer Focus suggests that energy firms should take account of customers’ ability to pay when recovering debt and that they should offer more competitive deals that are not paid for by direct debit because low income households tend not to benefit from them.
The government is taking measures to tackle the issue, recently announcing the Warm Homes Discount on top of the Winter Fuel Allowance, saving a further £120 for the poorest pensioners. For some vulnerable groups, energy suppliers are also obliged to offer reduced price or free home insulation.
However, Caroline Flint, the shadow energy and climate change secretary, emphasised that “more people die each winter because they cannot afford to heat their homes than die on our roads". She said the government had to "get a grip and demand energy companies use their profits to cut bills now.”