Fuel poverty and the transition to net zero

By: Dr Fraser Stewart, Independent Consultant

Introduction

This paper for Energy Action Scotland examines the potential implications of Scotland’s climate change and net zero ambitions for those households living in or at risk of falling into fuel poverty. The issues explored are intended to contribute to wider discussions about the nature and shape of Scotland’s transition to net zero.

In 2019 the Scottish Parliament passed legislation that redefined fuel poverty as existing when a household spends more than 10% of its income on fuel costs and if the remaining household income is insufficient to maintain an adequate standard of living. The Act also proposed that the mean fuel poverty gap of households in fuel poverty should be no more than £250 (in 2015 prices before inflation). In addition, the legislation set out new statutory targets to reduce fuel poverty by 2040 to no more than 5% of Scottish households and no more than 1% being in extreme fuel poverty. Provision was also made for a new fuel poverty strategy being published and the establishment of an independent fuel poverty advisory panel. These were both delayed due to the COVID-19 public health and economic crisis, with the final strategy being laid before the Scottish Parliament in November 2021.

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