Charities and Firms Warn Chancellor: Cutting Insulation Grants Risks Climate Goals

In a letter to the Chancellor, over 60 organizations, including energy firms, fuel poverty charities, and environmental groups, have urged the government to avoid cutting funding for home insulation measures. The letter warns that such a "short-term fix" to reduce energy bills could undermine the UK's ability to meet its climate and fuel poverty targets.

The Chancellor is reportedly considering reducing or eliminating the Energy Company Obligation (ECO), a scheme that helps energy firms pay for energy efficiency upgrades in low-income and vulnerable households. The groups argue that this would "call into question the ability to meet both the UK's fuel poverty and carbon budget targets" and put thousands of jobs at risk in the £20 billion energy efficiency industry.

While the groups welcome the government's plans to provide direct support to struggling households, they emphasize that decarbonizing homes through cost-effective upgrades is the best way to sustainably address fuel poverty and reduce energy costs for all consumers in the long run. The letter warns that cutting the ECO program could lead to a repeat of the last time it was reduced, when 10,000 people lost their jobs and millions of families were "left in draughty homes paying astronomical energy bills."

The government is under pressure to find ways to ease the cost-of-living crisis, but the signatories argue that reducing investment in energy efficiency would be a "shortsighted and disastrous move" that would ultimately harm the very households it aims to support.