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Fuel Poverty

Low Income High Costs (LIHC) definition

Fuel poverty is measured using the Low Income High Costs (LIHC) indicator, a dual indicator which measures both the level (number of households) and depth (fuel poverty gap).  A household is considered to be fuel poor if:

  • they have required fuel costs that are above average (the national median level);

  • were they to spend that amount, they would be left with a residual income below the official poverty line

There are three key elements in determining whether a household is fuel poor:

  • Household income

  • Household energy requirements (energy consumption)

  • Fuel prices (fuel bills)

The LIHC indicator consists of two indicators:

  • The number of households that have both low incomes and high fuel costs;

  • The depth of fuel poverty among fuel poor households, measured through a fuel poverty gap which represents the difference between the required fuel costs for each household and the median required fuel costs. 

(Source: Department of Energy & Climate Change, June 2016)

Key findings

  • Fuel poverty is linked to low income and/or high energy costs

  • 2.38 million households in England are estimated to be in fuel poverty, 10.6% of all households, an increase of 1.4% from 2.35 million in 2013

  • Rural areas have greater levels of fuel poverty

  • An estimated 28,176 households in Cumbria are estimated to be in fuel poverty, 12.5% of all households

  • Levels of fuel poverty in Cumbria and all of its districts are greater than national levels

  • Levels of fuel poverty in Cumbria have increased from 10.9% in 2013 to 12.5% in 2014 (+1.6%)

  • Levels of fuel poverty have increased in all of the districts with the exception of Barrow-in-Furness where they have fallen

  • Levels of fuel poverty are the greatest in Eden (16.4%); they are the lowest in Copeland (11.2%)

  • Levels of fuel poverty in Eden are the second highest in England (out of 326 local authorities)

  • 51 Lower Super Output Areas (LSOAs) in Cumbria have levels of fuel poverty which fall within the worst 10% nationally

  • The LSOA which falls within the ward of Warnell in Allerdale has the highest levels of fuel poverty in Cumbria at 28.9%

  • There isnít one significant driver or causality of fuel poverty - factors affecting fuel poverty include household income; age of the property; household tenure; household type; household size/floor space; household size (number of people living in the household); economic status

Fuel Poverty Briefing, June 2016 (reporting 2014 data)

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