It may only be August, but there are concerns of a long and difficult winter ahead for many households, as looming price hikes for energy costs threaten to push more people into fuel poverty.

As The National reported earlier this month, energy watchdog Ofgem will raise the price cap on energy bills from October, with millions of households across the UK set to pay at least £139 more annually.

Plaid Cymru MS Peredur Owen Griffiths said he was "hugely concerned" about the impact the price hike would have on "already strained" lower-income households.

"The changes will hit those with the least hardest", especially pensioners and people in areas with high poverty rates, he added.

"This wholesale price will mean more and more people will be choosing between food or fuel – a situation that is unacceptable and should be challenged," he wrote in a letter to the Welsh Government this week, urging ministers to mitigate the impacts of rising prices.

The government told The National it feared the new prices would have "a devastating effect on lower income households at a time when the domestic demand for energy will be increasing". It had written to Ofgem in June to express concerns about the previous change to the energy price cap, a government spokesperson added.

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When Ofgem announced the price hikes, its chief executive blamed the "difficult decision" on wholesale energy price rises.

“Higher energy bills are never welcome and the timing and size of this increase will be particularly difficult for many families still struggling with the impact of the pandemic," Jonathan Brearley said at the time.

“The price cap means suppliers only pass on legitimate costs of supplying energy and cannot charge more than the level of the price cap, although they can charge less.

Citizens Advice Cymru has been campaigning against fuel poverty – which is when someone on a lower-income cannot keep their home warm at a reasonable cost.

Rhiannon Evans, the organisation's head of policy and campaigns, said: "74,000 households in Wales have gone without heating in order to pay for essentials in the last two years. There are clear links between fuel poverty and poorer health, wellbeing and the educational attainment of children living in cold homes."

Government research paints a similarly bleak picture, with the latest available estimates suggesting 145,000 households in Wales were spending 8-10 per cent of their household incomes on their home energy needs.

The government has published a long-term strategy for tackling the issue, and aims to have eradicated "severe or persistent" fuel poverty by the year 2035, as well as halving the number of households at risk of falling into fuel poverty, based on 2018 estimates.

Evans said the government's Tackling Fuel Poverty plan was welcomed by Citizens Adivce Cymru, because it "sets a much-needed strategic direction for how to tackle this scourge". But she added that policies on energy efficiency targets should "go further and faster", and called for more local-level policies that would address specific fuel poverty issues faced by people in rural areas of Wales.

Citizens Advice Cymru said it would also like to see the government promote the option of switching tariffs "to ensure people are getting the best deal". For some lower-income households, however, switching to a new supplier or tariff is "simply not an option", the government said, because people are in arrears with their current energy supplier.

Research by Citizens Advice Cymru last November estimated more than 60,000 households across Wales were behind on their energy bill payments during the pandemic, with the total owed reaching around £10million.

And for people who had yet to reach a repayment deal with their supplier, researchers found those households owed on average £760 for electricity and gas.

As Owen Griffiths told The National, months of uncertainty during the pandemic will have piled pressure on many lower-income families, who now face the prospect of needing to pay substantially more to keep their homes heated this winter.

"It's going to be hard for younger families, and for older people, to find that extra £150 a year," he said. "The average prices are going to go up massively, and some people are going to be seriously considering, 'Do I turn the heating on or do I put food on the table?'"

What support is currently available?

As part of the longer-term solutions to fuel poverty, the government is investing in retrofitting schemes and house-building programmes that priorities energy efficiency in affordable homes, but here we will take a look at the more immediate support that is available to individual households that may be struggling with energy costs.

The Welsh Government's own Warm Homes Programme has been running since 2009/10, costing £366million so far, and has helped a reported 61,400 lower-income households improve their homes' energy efficiency and emissions, saving an average of £280 on their annual energy bills.

As part of that programme, the Nest service offers free advice over the phone to people who are struggling with the cost of their energy bills, on topics from money management, finding the most suitable tariff, and eligibility for any relevant benefits payments. In 2019/20 more than 15,000 households received free advice from Nest, and 5,000 received home improvement support to help them cut the costs of their bills.

The next iteration of the Warm Homes Programme will go out for consultation in December, and one issue that Citizens Advice Cymru researchers have raised recently is around public awareness of the support services that are available. They found that while the majority of adults wanted to improve their homes' energy efficiency, awareness of the Nest advice service was much lower, with only around one-in-five people knowing the scheme existed.

The Welsh Government has also invested £24.5million in our Discretionary Assistance Fund to help people who are experiencing what it describes as severe financial hardship.

The fund offers crisis payments for people in such a situation, and while these payments are not intended to meet the cost of ongoing expenses, they can be made available to people who have no other means of meeting the immediate cost of living.

Rhiannon Evans at Citizens Advice Cymru said the Discretionary Assistance Fund was "an important source of emergency support including [for] those struggling with fuel poverty, and the Welsh Government should ensure it has the resources it needs to support all households who need it and is promoted widely".

People on low incomes, and some pension-holders, may also be eligible for the UK Government's Warm Home Discount Scheme, which offers a one-off £140 discount on annual energy bills. Applications for this year's scheme opens on October 18. 

And many people on pensions may also qualify – or be able to make a claim – for the UK-wide Winter Fuel Payment Scheme, that offers between £100 and £300 towards the cost of their heating bills.

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