Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 15 January 2018 to Question 121674, for what reasons the calculation of projected savings under the new energy cap uses data on average consumption when people in receipt of the Warm Home Discount or in fuel poverty consume below that average consumption.

Ofgem’s decision to extend the Pre Payment Meter safeguard tariff to those consumers in receipt of Warm Home Discount (WHD) was published on 7 December 2017 and is available at:

https://www.ofgem.gov.uk/system/files/docs/2017/12/decision_letter_whd_safeguard_tariff_-_final.pdf.

In their decision, Ofgem describe their reasons for calculating projected savings under the energy price cap based on the Typical Domestic Consumption Value. They note the possibility that vulnerable customers may be more likely to be within lower consumption brackets than the Typical Domestic Consumption Value, and this could lead to an overestimation of the available savings within their impact assessment. However, they also note that consumption levels for all customers, including those considered vulnerable, are likely to vary considerably. Given the desire to implement the cap for these vulnerable customers quickly, and the lack of consumption data specific to WHD customers, Ofgem did not factor this into their analysis.