Cabinet Sub Group - Performance Board

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1 Cabinet Sub Group - Performance Board Part 1 1 November 2012 Item No 4 Subject Purpose Author Ward Summary Fuel Poverty To provide Performance Board with an outline of what constitutes Fuel Poverty and details of how Newport City Council is tackling the reduction in Fuel Poverty through its Affordable Warmth Strategy and Action Plan. Mike Jones Housing and Community Regeneration Manager All wards This report provides a background to understanding Fuel Poverty along with details of how the Council is seeking to reduce the level of fuel poverty for the households in Newport. Proposal Action by Timetable To note the report and continue the work outlined in the Affordable Warmth Strategy Head of Regeneration and Regulatory Services Immediate This report was prepared after consultation with: Head of Law & Standards Head of Finance

2 1. Background 1.1 The inability to afford sufficient warmth for health and comfort was first recognised as a significant social problem in the early 1970s. The causes of fuel poverty are complex, but contributory factors include low household income, poor insulation standards, inefficient or expensive heating systems and under-occupancy of properties. Many households contain individuals who may require extra warmth as a result of age or disability. Further, lack of access to a mains gas supply denies many rural customers the benefits of the most efficient and economic method of heating. 1.2 Fuel poverty not only damages the well-being of individual households, but also imposes additional costs on the wider community in treating poor health, financial disadvantage and social exclusion. The UK Fuel Poverty Strategy recognises that local authorities are the most important agencies in the eradication of fuel poverty. It is clear that housing issues will be paramount in any programme of fuel poverty reduction. But finding solutions to fuel poverty also cuts across many other areas of social policy; for example the promotion of better health and well-being, environmental policy, economic regeneration and the redevelopment of communities. Local authorities are well placed to broker the kinds of partnerships that can act strategically and have significant impact in these areas. 1.3 Fuel poverty is defined as having to spend more than 10 per cent of income (including housing benefit) on all household fuel use to maintain a satisfactory heating regime. Where expenditure on all household fuel exceeds 20 per cent of income, households are defined as being in severe fuel poverty. 1.4 There are a number of key factors that can influence fuel poverty and where it might exist. The energy efficiency of the dwelling this is said to be the major issue as the more energy efficient, the less energy used and whilst maintaining adequate temperature will protect against slipping into fuel poverty. Retro-fit measures such as cavity or external wall insulation, loft top up insulation and hot water tank covers can save up to 280 on fuel bills. Income argued as the second key contributor as it is part of the equation that determines fuel poverty. The average combined gas and electricity fuel bill in the UK is accepted to be 1200 per annum. A household income would therefore need to be more than 12,000 per annum to be considered above the fuel poverty line. By reducing fuel consumption through greater thermal efficiency lowers fuel bills and takes families out of fuel poverty. Energy prices Energy prices are also a key driver of fuel poverty. Increases in the number of households in fuel poverty have been due largely to increases in consumer energy prices. This issue can be the most variable as fluctuations in the price of energy can move thousands of households in or out of fuel poverty. Fuel switching or Fuel brokerage are fast becoming a way of avoiding the highest of fuel costs. Energy usage How we use energy, more importantly waste energy can make 1% or 2% difference in relation to average bills and so at the margins affect fuel poverty. Micro Generation this is where energy is generated on site and the obvious effect is to reduce demand for energy. This option should preferably be employed where the property is reasonably energy efficient so as to minimize demand. A Solar Pv system can reduce a Homeowners electricity bill with the sensible use of electricity. A typical 12 panel system produces around 2,000 kwh of electricity, which, if the home uses just 2

3 half is worth 150, but for those at home during the day the saving could be more. With electricity prices continually rising, the savings will grow each year. 1.5 A consequence of Fuel Poverty is that residents often have to make choices between key bills to be be paid such as rent, rates etc. and keeping their home at an appropriate temperature. For those residents in receipt of benefits, where housing costs, rates etc are paid the choice is between fuel or food. The difficulty faced is control, fear exists about receiving large fuel bills that cannot be paid and so often heating is switched off or used to a minimum. 1.6 The key links between temperature and health are as follows (National Public Health Service for Wales) C, no risk to sedentary healthy people Below 16 C, diminished resistance to respiratory infection Below 12 C, short term increase in blood pressure Below 9 C, after two or more hours, deep body temperature falls 1.7 The health effects of cold homes are as follows (National Public Health Service for Wales ) Increased respiratory illness Worsening of asthma and COPD Increased blood pressure and risk of heart attacks and strokes Worsening arthritis Increased accidents in the home Increased social isolation Impaired mental health 1.8 Adverse effects on nutrition in respect of children and cold homes health issues include Physical ill health Psychological health Educational attainment Social exclusion 1.9 The eradication of fuel Poverty in Newport is delivered through the council s Affordable Warmth Strategy and Action Plan The Affordable Warmth Strategy provides a focus for local action to eradicate fuel poverty. The benefits of a well-planned, organised and implemented strategy can be far-reaching, helping the authority to: Raise general awareness of fuel poverty and affordable warmth issues. Encourage cross-departmental and inter-agency partnership working to maximise resources. Promote cross-community participation, co-operation and wider ownership of the strategy. Maximise and target resources and initiatives where they are most needed. Facilitate policy and service integration. Set out measurable targets and timescales for action. Develop training and employment opportunities. Provide feedback for target monitoring and reporting purposes The Action Plan sets out all of the activities completed and planned to reduce the level of fuel Poverty in Newport. 3

4 1.12 The first key objective of the Action Plan was to determine the level of Fuel Poverty in Newport at a single point in time so as set a baseline for improvement but also to establish on a ward by ward basis the underlying key causes, ie the SAP rating (Standard Assessment Procedure) how efficient is the building, income levels and those on benefits or may need benefits advice and to determine where there is a need to provide more energy education so as to help minimise usage safely The Survey has been completed and found to identify that across the City 18% or 9639 households who responded to the survey were likely to be fuel poor. This information and statistical data has allowed the Local Authority to make bids where appropriate to external energy companies, Welsh Government etc for funding to carry out insulation works This has been completed and detailed analysis of the results started. This will allow bids to be made where appropriate to external energy companies, Welsh Government etc Progress against the Action plan is monitored through Overview and Scrutiny Forum for Housing and Community Services. The Overview and Scrutiny Forum for Housing and Community services last received a monitoring report in January The Report and updated Action Plan can be viewed here Action Plan In addition three local performance indicators have been created to measure the reduction in Fuel Poverty and these feed data in to the Outcome Agreement attached as Appendix A for information of how much activity has been undertaken in this area of the service this financial year 1.17 In terms of work planned for the next 12 months - Securing of ARBED2 and CESP (Community Energy saving Programme) funding (equivalent of 2,000,000 external funding to treat approximately 300 solid wall construction properties) where a high degree of fuel Poverty will exist because of the cost of heating the dwelling to normal standards. The three main areas to benefit will be Bettws, Malpas, Ringland. The continuation of the programme of educational seminars aimed at vulnerable households and schools. To further develop the Benefits Advice programme with the Citizens Advice Bureau that was identified in the survey conducted across the whole of Newport. To continue to develop the programme of micro generation of electricity through photo voltaic installations As directed by Overview and Scrutiny to link to other networks and to campaign for lower energy prices to help tackle fuel poverty and prevent decision having to be made in respect of eating or heating. How best to take this forward is currently being reviewed so as to make maximum benefit of any Council intervention The Government is taking forward it s initiative Green Deal, in essence it tests a home now and places a value on the work required to bring the property up to a set SAP rating. If the level of predicted savings that would be achieved is greater than the cost of a loan to install the energy efficiency measures the utility companies must provide the financial assistance. The cost of repaying the loan is transferred across ownership of the property and is secured through a legal charge on the property This is seen as a considerable opportunity for not only the improvements in energy efficiency of the dwellings but also as a major regeneration opportunity in the creation of employment in the delivery end of the energy efficiency measures Considerable improvement in the energy efficiency of homes in Newport over recent years and the Affordable Warmth Strategy is designed to continue this work as the various 4

5 schemes set out by Central Government and energy companies change, this includes the development of the new Green Deal. 2. Financial Summary: 2.1 The revenue cost of delivering the work on the Affordable Warmth Strategy is included in the Private Sector Housing Service and by acting as an enabler it levers in substantial external resources to continue the work outlined in the action plan. 2.2 There are no additional revenue costs associated with this report. 2.3 All capital work for energy improvement of existing homes is provided through external funding via Welsh Government and energy companies. 3. Risks: 3.1 The risks identified with Fuel Poverty fall into a number of categories, those that are immediate and could affect the health and well being of an individual and those at a strategic level that could affect delivery of key Health, Social Care, Housing and Public Protection Services. Risk Increase in ill health, hospital admissions and excess winter deaths Increase in demand for Health and social care Services Increase in Public Protection activity as excess cold is major contributor to Category 1 Hazards within Housing Health and Safety Rating System. This could have financial consequences if default work undertaken. Increase in homeless Impact of Risk if it occurs* (H/M/L) High Medium Medium Probability of risk occurring (H/M/L) Medium Medium Low What is the Council doing or what has it done to avoid the risk or reduce its effect Work as outlined in Affordable Warmth Strategy Work as outlined in Affordable Warmth Strategy Work as outlined in Affordable Warmth Strategy Work as outlined in Affordable Warmth Who is responsible for dealing with the risk? Housing and Community Development Manager Housing and Community Development Manager Housing and Community Development Manager Housing and Community 5

6 Risk presentation on basis of category 1 hazards Impact of Risk if it occurs* (H/M/L) Probability of risk occurring (H/M/L) What is the Council doing or what has it done to avoid the risk or reduce its effect Who is responsible for dealing with the risk? Medium Low Strategy Development Manager 4. Links to Council Policies and Priorities Housing Strategy Health, Social Care and Wellbeing Strategy Financial Inclusion Strategy 5. Options available 5.1 To note report and continue work outlined within Affordable warmth Strategy. 6. Preferred Option and Why 6.1 Report for information only. 7. Comments of Head of Finance - Chief Financial Officer 7.1 There are no new financial implications in this report. All capital funding will be generated from external sources. 8. Comments of Head of Law and Standards - Monitoring Officer 8.1 There are no legal issues arising from the Report. 9. Staffing Implications-: Comments of Head of HR Policy and Performance 9.1 There are no staffing implications contained within the report. 10. Background Papers Affordable Warmth Strategy Appendix A-Outcome Agreement No.7 Dated : 22 October

7 Appendix A Performance Board 1 st November 2012 Outcome Agreement 7 Affordable Warmth Lead Cabinet Member: Paul Cockeram (Cabinet Member for Social Care and Wellbeing) Lead Officers: Susan Bolter, Mike Jones, Jason Gunter, Phil Slade Assessment of performance: Reporting Actions Letter Actions from Outcome Agreement Actions completed June 2012 Evidence RAG Status A Installation of automated meter reading Action completed in 2010/11 technology across Council estate B Switch-off of street lighting Action completed in 2011/12 C Conduct city-wide Affordable Warmth & Action completed in 2010/11 Energy Efficiency survey. D Complete Affordable Warmth & Energy Action completed in 2010/11 Efficiency Survey E Identification of localised pockets of fuel Action completed in 2011/12 poverty and CO 2 emissions F Provide localised solutions as detailed within the Affordable Warmth Action Plan The results from the Energy survey completed in 2011 have been used to co-ordinate different funding streams in areas where deprivation and fuel poverty exist. - Provisional acceptance of our Arbed 2 bid from the Welsh Government for the Malpas ward to insulate 180 BISF hard to treat homes. Scheme value 1.8m. NCC currently working with Melin Homes (project Manager for the scheme). Scheme at inception Stage. - Community Energy saving Programme (CESP) scheme also in the Malpas ward to support Arbed. Measures to include loft top ups, boiler changes and energy and

8 water saving advice. Scheme value 800k. - Top up Arbed One funding to support Malpas scheme. Bid currently in with Welsh Government. Value 200k. - Continuation of the Community Energy saving Programme (CESP) scheme in Bettws ward. Part of the energy supplier obligation with Priority Group funding. 600k - Currently working with local primary schools to provide a programme of school talks starting in the new school term. In partnership with the Authority the South East Wales Energy Agency is providing an advice service on energy related issues to Newport residents. Continued Inter-Agency working with the EST and SEWEA. Reporting Quantitative Evidence Measure Reporting Frequency Actual 2011/12 (April 2012 to March 2013) Target (2012/13) Survey Results Annual Baseline 8583 homes NA Number of properties in targeted wards with Annual increased Thermal Efficiency Percentage of households in targeted wards Annual 2% (260) 1400 receiving advice and benefits signposting Percentage decrease in numbers of households classified as being fuel poor Annual 2% (167) 860 8