UK Fuel Poverty Strategy Help and Grants

The UK government has always said it wants to eradicate fuel poverty, so how is this goal being addressed?

Fuel Poverty Definition

The simple definition of fuel poverty in the UK is as follows: people are in fuel poverty if their energy bills are more than 10% of their household income. With the average Energy Price Cap fuel bill of approximately £1,755, people with an annual income of £17,550 fall into the poverty bracket. Extreme fuel poverty is where 20% of income gets spent on energy costs to provide heating to a reasonable level.

Government Strategy

The government has quite loose targets in an attempt to eradicate fuel poverty by 2030. In England, these targets aim to improve the energy efficiency of homes to Band C for those deemed fuel-poor. Scotland has tougher targets to reduce the number of households in fuel poverty to 5% and in extreme fuel poverty to 1% by 2040.

Households Struggling to Pay Energy Bills

Research by Citizens’ Advice suggests that 5.3 million homes in the UK (England, Wales, and Scotland) struggle to pay their fuel bills. This figure is 1.3 million less than when DECC undertook similar research in 2010.

However, a 2025 survey by End Fuel Poverty Coalition indicates that 12 million households are struggling to afford energy costs, and almost 5 million are in “deep fuel poverty,” spending over 20% of their income on energy. 

With around 25 million homes in the UK, of which about 70% are owner-occupied, this suggests that around a quarter of the population find financial difficulty in paying their energy bills. With electricity and gas prices at their highest ever and prices only set to increase to fund investments in alternative fuels, this figure may be difficult to reduce over the medium term.

Although there is no detailed government strategy suggesting that by doing x, y number of homes will escape fuel poverty, some steps are in place to reduce the amount of consumption homes endure.

Grants and Help Available

At present, there are various government heating and insulation grants available to those on low incomes under the Warm Front initiative. Those who qualify get up to £3,500 of free money to add insulation to their lofts or cavity walls. There are other grants available, and new green grants have also been announced. The green schemes provide grants for insulation and the development of renewable energy sources in homes, which sell the electricity back to the National Grid.

If you believe you are in fuel poverty or even if you are on some type of benefits, then you should speak to your local council to see what grants and help are available to insulate your home. Insulation is the best investment to reduce your overall energy consumption and, therefore, your energy bills.

In addition, to cut costs, you should also look at the most competitive tariffs available to reduce your expenses. If you can pay by Direct Debit, then the tariffs are even cheaper.

New Charter from Consumer Focus

Consumer Focus has also launched a new charter that summarises what we have said above, providing a real step-by-step strategy for the government to reach its targets to end fuel poverty by 2030.

They suggest a complete overhaul of their strategy, including a coordinated plan for those who need help the most. They also suggest that if homeowners implemented all the available energy efficiency measures, it could reduce an inefficient home’s fuel bills by up to 70% and carbon emissions by 59%.

They add that this would require a significant investment, but if the target is to be achieved, radical new thinking may be necessary to ensure that UK fuel poverty is truly a thing of the past.

The latest government policy states that the current approach needs reviewing, with a new strategy required to support fuel-poor households and lower bills. There is no timeline set for the change.