Fuel Poverty – the EDF Energy approach

Valentine Mulholland

28th October 2008

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EDF Energy

• Part of the EDF Group

• One of the UK’s largest energy companies including:Electricity generation.Electricity distribution to over 20 million people.Electricity and gas supply to over 5 million

customers, both domestic and industrial and commercial

• Around 1.3 Million gas and electricity customer accounts in London.

• A strong commitment to both corporate social responsibility and tackling climate change:

June 2007 – EDF Energy Climate Commitments Early 2008 – EDF Energy Social Commitments

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Energy Assist social tariff• Industry first since April 2006 and offers customers on

prepayment, standard credit or direct debit prices a 15% discount.

• ‘Our Social Commitments’ committed:To extend Energy Assist until March 2009.To offering a social tariff until at least 2012 – another industry first.

• Currently have over 110,000 customer accounts on the tariff.

• Also offer the customer a free benefit entitlement check and energy efficiency advice.

• Eligibility - existing EDF Energy customer and:In receipt of income support orPension credit orEvidence that in fuel poverty.

• 4 suppliers have followed our example.

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EDF Energy Trust• Established by EDF Energy in October 2003 to provide advice

and direct support for customers struggling to pay energy and other bills.

• First energy trust in the UK• Outside EDF Energy and managed by an independent

Board of Trustees – 100% funded by EDF Energy donations• Have donated over £8.5 Million, and Trust has made 10,000

individual awards• Awards to :

Individuals with energy or other household debtOrganisations who offer education, support and advice on debt and household budgeting

• Sustainable - over 70% of people who receive an award are still debt free after 1 year.

• 4 other suppliers have followed our example.

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Supporting prepayment customers

• Whilst most prepayment customers are not fuel poor, they are most likely to be on low incomes.

• Suppliers charge those customers who choose this method of payment more to cover the additional costs of managing this payment method

• But in 2005, EDF Energy was the first supplier to align the cost of our electricity prepayment tariff to our standard tariff

• Even in gas, we keep the price difference as low as possible

Differential to price paid by cash/

cheque. customers

Differentials to price paid by direct debit customers

EDF Energy average differential

£34.90 £76.87

Ofgem assessment of reasonable additional costs incurred by suppliers to offer prepayment

£65 £85

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Other voluntary initiatives to support fuel poor customers• London Warm Zone

Partnership with 18 Local Authorities extending across LondonEDF Energy provides:

» Core funding C£250,000 a year.

» Seconded Project Manager

» CERT funding to deliver insulation element

• Safe, Warm and Well campaign

• Partnership with WRVS

• Partnership with other voluntary organisations including:» Citizen’s Advice Bureau

» National Energy Action – sponsoring and joint work

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Ofgem’s ‘review of suppliers’ initiatives - August 2007

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The supplier ‘voluntary commitment’

• EDF Energy position – we would support a mandatory social tariff.

• Government reluctant to legislate.

• Discussion with Treasury and BERR have led to a voluntary social commitment agreed April 2008.

• Ofgem framework for eligible spend and monitoring:Social tariffs and rebatesWarm ZonesPartnershipsTrust FundsEnergy efficiency over and above CERT

2008/09 2009/10 2010/11

£100 Million £125 Million £150 Million

£11 Million EDF E £13Million £16 Million

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www.edfenergy.com/toolkit/index/html