Centrica welcomes agreement on fuel poverty

Centrica has welcomed the three-year voluntary agreement reached between the UK Government and the six largest energy suppliers which will help a further 100,000 households struggling with fuel poverty.

Each company talked to the Government separately, leading to an agreement to contribute a total of £225 million extra over the next three years - rising from the current £50 million to £100 million in 2008-09, £125 million in 2009-10, and £150 million in 2010-11.

The Government estimates that the deal will help 100,000 households struggling with fuel poverty (spending more than 10 per cent of their income on energy). Business Secretary John Hutton congratulated Centrica and our industry peers for  cooperating on this latest move to tackle fuel poverty.

It is a voluntary agreement and the money can be spent by suppliers on a variety of initiatives with agreement from UK energy regulator Ofgem. Centrica's contribution will be calculated according to market share, based on customer numbers and it need not be confined to social tariffs or rebates.


British Gas has been widely recognised as leading the energy sector on this issue. An energywatch report highlights that at least £64 out of every £100 spent on fuel poverty has come from British Gas, and that Centrica have made the most significant voluntary commitment of all the six suppliers. We intend to build upon our contribution in 2008.

This is around double Centrica's market share; our British Gas Essentials tariff a large contributor - the largest social tariff on the market - which could help up to 750,000 customers. Centrica also offer support for vulnerable customers through, the British Gas Trust Fund and our winter warmer payments, and we expect to spend up to £300 million a year on CERT (Carbon Emissions Reduction Target), of which 55 per cent is going to help alleviate fuel poverty.

The agreement is positive for numerous reasons; we suppliers think we can handle the demands. People in fuel poverty will be helped. And the Government will move nearer its challenging target of eradicating fuel poverty for vulnerable people by 2010.