Dr Gareth Powells discusses the outcomes from a major research project led by Newcastle University in partnership with National Energy Action (NEA), the Energy Audit Company (EAC), and the University of Bristol to evaluate the Warm Homes Fund (WHF), one of the largest fuel poverty programmes across Great Britain.
Contents:
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Tackling fuel poverty using the Warm Homes Fund model
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Societal benefits
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Economic impacts
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The DEEP Blueprint
Tackling fuel poverty using the Warm Homes Fund model
As seen in our previous blog post, the Warm Homes Fund had a tangible impact on the number of low-income households who could keep their homes warm, contributing to improved health and wellbeing. Our evaluation also showed supporting low-income households with energy costs had wider economic benefit. Using this research, we’ve now developed a framework based on the model of the Warm Homes Fund for the design and delivery of future large-scale fuel poverty and energy efficiency programmes. Funded by National Grid, and representing private sector investment of £150mn, the funding paid for home energy improvements in low-income households in hard-to-heat homes across Great Britain.
The WHF saved households an average of £922 per year on their energy bills by lifting the average home by 19 SAP points (the standard measure of home energy efficiency, with scores ranging from 0 to 100). Even when the WHF had not lifted a home out of fuel poverty (using the ‘Low Income, Low Energy Efficiency’, or LILEE definition), the average fuel poverty gap for such homes fell by almost £600 per year.
Societal benefits
As well as documenting the depth and breadth of benefits created by the WHF, the project highlighted the deepening domestic crises created by the energy price rises of recent years, the effects of cold homes on health and wellbeing and the societal benefits that can be created by effective action to tackle cold homes.
Interviews created detailed depictions of these crises, discussing the impacts of worrying about the health of vulnerable family members, feelings of shame and embarrassment, and the constant stress and burden of trying to juggle inadequate household budgets.
The survey research showed, however, that 48% of respondents reported improved physical health, and 39% of respondents reported that their mental health was better as a result of the intervention. We were able to quantify the NHS cost savings associated with these improvements to build a compelling and multi-faceted case for targeted public funding of energy affordability and efficiency improvements as a coordinated response to climate, health and energy crises.
The total NHS cost savings generated by the WHF are estimated to be £2,491,381 per annum.
Economic impacts
A further aspect of the project was to quantify the wider economic impacts of the Warm Homes Fund. Economic modelling shows that investment in the construction, retrofit and installer sectors, and the support services sector stimulated an additional £200mn of demand in the economy. This means that for every £1 spent on warm homes measures, a further £1.34 of demand was stimulated in the wider economy.
A second form of economic impact from the WHF is the long-lasting benefit to households of reduced energy bills - which can be regarded as an increase in household disposable income - was £10.8mn. The likely re-spending of this by households will create a further £14.4mn of spending annually, demonstrating the positive economic impact of energy bill reductions on the wider economy.
Importantly for the evaluation and for future policy design, we showed that targeting low-income households increased this wider economic impact. By doing so, the WHF grants produced a greater boost in demand across the economy than if the funding had gone to middle-income households.
Analysis shows that by targeting low-income households, approximately £2mn more demand per year has been created in the wider economy than would have otherwise been the case.
This helps build the case for investing in fuel poverty alleviation as a means of stimulating the economy as well as responding to climate and health crises.
The DEEP Blueprint
Building from this research, we developed a policy design document; The DEEP Blueprint. Providing a framework for the Design of Energy Efficiency Programs, DEEP is based on the roles and relationships different stakeholders have, how they relate to five core elements of program design, and ten guiding principles for those design elements..
In addition to outlining five core elements for designers to consider, the research also provides guidance on how to approach and design each of these core elements to achieve the best possible outcomes for households, as well as for wider society, the economy, and the environment.
| Five Key Actor Types | Five Core Elements of Design | Guiding Principles for Design |
| Governance | Funding and Finance |
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| Fund Managers | Interventions and Technology |
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| Delivery Partners | Partnerships and Collaborations |
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| Households | Eligibility and Targeting |
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| Wider Economy, Society and Environments | Evaluation and Learning |
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We are working with the sector to make sure that the DEEP model is understood by and is useful to policymakers, industry actors, and other stakeholders as a blueprint for the design and delivery of future large-scale fuel poverty and energy efficiency programmes. Through that work, we hope it will ultimately contribute to warmer, healthier, and more energy-efficient homes for low-income communities in the UK.
You might also like:
- Read the report: Warm Homes Fund Evaluation
- Check out our previous blog on Early findings from the Warm Homes Fund Evaluation
- Find out more about Gareth Powells, Senior Lecturer in the School of Geography, Politics and Sociology at Newcastle University
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