Refreshing our Consumer Vulnerability Strategy

We are consulting on our proposals for a refreshed Consumer Vulnerability Strategy. ## Who should respond Everyone is welcome to share their views and help us develop the updated strategy. We particularly encourage responses from: * consumer groups * charities * suppliers * network companies * consumers ## Background In 2013, we published the first [Consumer Vulnerability Strategy](https://www.ofgem.gov.uk/decision/consumer-vulnerability-strategy), which explored the complex nature of vulnerability and set our definition of it. In 2019, we updated the Strategy due to the widespread changes in the energy market. Since then, the energy sector has gone through significant upheaval. The resulting price rises have been especially hard for consumers in vulnerable situations. We want to refresh our Strategy to reflect a rapidly changing sector and evolving social and economic environment. ## Our proposals We want to make our strategic outcomes more specific. We have proposed outcomes for each theme in the Strategy. We have also said how we will measure the success of these outcomes. We propose having an annual meeting with energy suppliers where they show how they are helping consumers in vulnerable situations. After these meetings, we would publish our findings to share good practices and encourage innovation. ## Before you start For more details and background information, see: * [Consumer Vulnerability Strategy 2025](https://www.ofgem.gov.uk/decision/consumer-vulnerability-strategy-2025) * [Consultation paper: Consumer Vulnerability Strategy Refresh (PDF 572 KB)](https://consult.ofgem.gov.uk/energy-supply/consumer-vulnerability-strategy/supporting_documents/Consumer_Vulnerability_Strategy_Refresh_Consultation_paper_September_2024.pdf) --- Consultation Consumer Vulnerability Strategy Refresh Publication date: 10 September 2024 Response deadline: 5 November 2024 Contact: Lauren Kennedy Team: Consumer Vulnerability and Debt Telephone: 020 7901 7000 Email: ConsumerVulnerability@ofgem.gov.uk We are consulting on Ofgem’s Consumer Vulnerability Strategy. We would like views from people with an interest in consumer vulnerability and protections. We particularly welcome responses from consumer groups and charities, suppliers and network companies. We also welcome responses from other stakeholders and the public. This document outlines the scope, purpose and questions of the consultation and how you can get involved. Once the consultation is closed, we will consider all responses. We seek to be transparent in our consultations. We will publish the non-confidential responses we receive alongside a decision on next steps on our website at ofgem.gov.uk/consultations. If you want your response – in whole or in part – to be considered confidential, please tell us in your response and explain why. Please clearly mark the parts of your response that you consider to be confidential, and if possible, put the confidential material in separate appendices to your response. OFG1164 Consultation – Consumer Vulnerability Strategy: Refresh © Crown copyright 2024 The text of this document may be reproduced (excluding logos) under and in accordance with the terms of the Open Government Licence. Without prejudice to the generality of the terms of the Open Government Licence the material that is reproduced must be acknowledged as Crown copyright and the document title of this document must be specified in that acknowledgement. Any enquiries related to the text of this publication should be sent to Ofgem at: 10 South Colonnade, Canary Wharf, London, E14 4PU. This publication is available at www.ofgem.gov.uk. Any enquiries regarding the use and re-use of this information resource should be sent to: psi@nationalarchives.gsi.gov.uk 2 Consultation – Consumer Vulnerability Strategy: Refresh Contents Consumer Vulnerability Strategy Refresh Foreword ................................................................................................ 4 Executive Summary ................................................................................ 6 The importance of our Consumer Vulnerability Strategy ............................ 6 Consumers in vulnerable situations have been badly affected by the cost-of- living crisis ........................................................................................ 6 Our work is crucial given the number of consumers in vulnerable situations in Great Britain ...................................................................................... 6 A refreshed and more targeted Consumer Vulnerability Strategy ................ 7 1. Introduction .................................................................................... 10 History of our Consumer Vulnerability Strategies ................................... 10 Why we are updating our Vulnerability Strategy ..................................... 10 What are we consulting on ................................................................. 10 How our proposals contribute to our objectives ...................................... 11 Context and related publications ......................................................... 11 Next steps ....................................................................................... 12 Your response, data and confidentiality ................................................ 12 How to track the progress of the consultation ........................................ 13 2. Refreshing the Strategy: Key things to know .................................. 14 Outcomes on a page ......................................................................... 14 3. Our work to protect and deliver for consumers in vulnerable situations .............................................................................................. 16 The first year of the Consumer Vulnerability Strategy 2025 ..................... 16 Delivery of Government Schemes ........................................................ 22 4. Consumer Vulnerability ................................................................... 26 Vulnerability definition ....................................................................... 26 How vulnerability has evolved ............................................................. 27 5. Themes, outcomes and our immediate priorities ............................. 34 Our key priorities .............................................................................. 34 Themes ........................................................................................... 34 Outcomes ........................................................................................ 36 6. Increasing transparency and accountability .................................... 52 Helping to rebuild trust in energy suppliers ........................................... 52 Appendix 1–stakeholder feedback on Strategy refresh ......................... 56 Stakeholder feedback ........................................................................ 56 Appendix 2– Privacy notice on consultations ........................................ 57 Personal Data .................................................................................. 57 3 Consultation – Consumer Vulnerability Strategy: Refresh Foreword Energy consumers in Great Britain have experienced a once in a generation shock to the energy system. They have seen their energy bills rise far above what they had been used to, and millions have struggled to afford to pay for their energy consumption. We know consumers in vulnerable situations were particularly badly affected, and many still cannot afford essential energy costs. At the same time, customer service satisfaction has been low, and has lagged behind other sectors. Consumers in vulnerable situations have too often not received the standard of service from their supplier that they are entitled to expect. Others feel left behind in the transition to Net Zero, unable to take advantage of technologies that they cannot afford or feel unable to use. Whilst we know there have been challenges, and we will continue to face these, there are opportunities too. That’s why our proposals for a refreshed Consumer Vulnerability Strategy are so important. They give us the chance to set out the outcomes we want to achieve for consumers in vulnerable situations, and how our and industry’s work can help to achieve them. It complements our wider work on raising standards for all consumers, and in particular our recently launched Consumer Confidence package. There are several outcomes we want to see industry deliver, such as: • Companies should know who their consumers in vulnerable situations are and what help they need. Data sharing is important for this, and we know it can be improved. We are committed to keep working with government and industry to drive this forward. • Consumers in vulnerable situations should know what support is available to them and how to access it, particularly when they are struggling to pay for their energy, and not face difficulties in doing so. They should get the best service for them from their supplier. Compassion and empathy are even more important when someone is struggling, and can be the difference between getting a good outcome or not. • Consumers in vulnerable situations should be empowered to take advantage of Net Zero technologies that are designed for their needs. These outcomes are vital for consumers in vulnerable situations to participate fully in the energy market. 4 Consultation – Consumer Vulnerability Strategy: Refresh To achieve them, companies need to have all consumers at the heart of their culture and decision making, but ensure they are particularly considering the needs of consumers in vulnerable situations. Our proposals for Consumer Vulnerability Panels will help us with this, and to have a reset conversation with industry. It will give industry the opportunity to show us good practice in how they deliver for their consumers in vulnerable situations, and us the opportunity to push them on where we think they can go further. We want to hold these Panels in the spirit of working together to drive up standards for consumers in vulnerable situations across the industry. Bringing this together into a refreshed Strategy is something we think can help guide us and industry in the months and years ahead. But we don’t want it to sit on the shelf. Industry needs to use it, and so do we. Our proposals for a narrower Strategy with fewer outcomes will help, as will our proposals to report against the Strategy outcomes regularly. They will help us hold ourselves to account on the projects we have delivered, the difference they have made, and any reasons why we have changed our priorities. We hope this will bring the transparency and accountability that we want to demonstrate and that our stakeholders want to see. I look forward to working with government, industry and consumer groups on the shared challenges we face, but also to take advantage of the opportunities we have to work together for the benefit of all consumers in vulnerable situations. Tim Jarvis Director General, Markets 5 Consultation – Consumer Vulnerability Strategy: Refresh Executive Summary The importance of our Consumer Vulnerability Strategy Our current Consumer Vulnerability Strategy was published in 2019. Since then, energy consumers in Great Britain have experienced significant challenges including the Covid pandemic, the gas crisis, and more recently cost of living challenges. We therefore want the Strategy to help domestic consumers in vulnerable circumstances to be at the heart of company cultures across the energy system. We want consumers in vulnerable situations to have their needs identified, to receive consistent and compassionate support, and be empowered to participate in the transition to Net Zero. Our Strategy aims to improve accountability for how the sector treats consumers in vulnerable situations. It will also improve transparency on how we report progress against our goals and complement our Consumer Confidence work to raise standards for all consumers. Consumers in vulnerable situations have been badly affected by the cost-of-living crisis The effects of the gas crisis and its impact on the cost of living affected all energy consumers, but particularly the vulnerable. Millions struggled to afford their energy bills and were forced to make difficult decisions on their day-to-day spending. The effects of this are still being felt across the country. Given our role as energy regulator, we could not fully shield consumers in vulnerable situations from the impact of high energy bills. But we worked closely with stakeholders to try and mitigate their effects. This included working with government to support the delivery of the Energy Bill Support Scheme (EBSS) and Energy Price Guarantee (EPG) to consumers, stabilising the market and avoiding further costly supplier exits, and bringing suppliers and consumer groups together to agree voluntary Winter Debt Commitments. There was significant public and stakeholder concern about suppliers’ practices on involuntary prepayment meters, and we introduced stronger rules as part of our response. Our work is crucial given the number of consumers in vulnerable situations in Great Britain Although we cannot predict how energy costs will change in future, we are emerging from the previous gas crisis. Energy bills have reduced since their peak in 2022. Although there are signs that pressure on household finances is easing as inflation falls, overall debt and arrears remain high, and we also know the price cap will rise this winter. Millions of consumers have characteristics of vulnerability in GB, which when 6 Consultation – Consumer Vulnerability Strategy: Refresh combined with aspects of the energy market, create situations where they are less able to protect themselves or represent their interests. The population is ageing, many have physical and mental health conditions, and others have a low income or are in debt and arrears, which makes it difficult to afford the essentials. Many are digitally disadvantaged without internet access, a smartphone, or the skills and dexterity to use them, and are therefore excluded from the increasing digitalisation of services. A refreshed and more targeted Consumer Vulnerability Strategy The current Strategy published in 2019 has 5 themes and 19 outcomes. However, this number of outcomes made it more challenging to deliver work against them and maintain focus. We therefore propose a more targeted Strategy which will retain the five themes as four standalone themes and one cross cutting theme, but with a focus on a smaller number of projects to deliver the outcomes we want to see, and with an emphasis on those that most directly help consumers in vulnerable situations. We have set out our overarching approach to this below. The Strategy aligns with our Multi-Year Strategy aim of ‘shaping a retail market that works for consumers,’ and with our Consumer Interest Framework. (Ofgem's multi year strategy) Theme 1: Improving identification and smarter use of data Outcome Vulnerable customers should have their needs identified, be able to easily notify and update their circumstances, and have better understanding of and access to support services designed to suit their circumstances and meet their needs. Work programmes • Review of the Priority Services Register; • Leading Working Group on development of multi-sector PSR; and • Working with energy and water on data sharing. Theme 2: Supporting those struggling with bills Outcome Vulnerable customers struggling to pay their bills should receive accurate bills that are easy to understand, compassionate and consistent support, and flexibility in payment methods and frequencies. Work programmes • Review our rules on debt and arrears; and 7 Consultation – Consumer Vulnerability Strategy: Refresh • Work with government on financial solutions on energy affordability and energy debt. Theme 3: Driving significant improvements in customer service Outcome Vulnerable customers should be provided with tailored communications that are easy to understand, are able to engage with their energy company with ease and do not face exclusion based on their circumstances. Work programmes • Continue our work on 24/7 emergency contact; • Networks RIIO3; • Networks ED3; and • Consumer Confidence. Theme 4: Encouraging positive and inclusive innovation Outcome Vulnerable customers should have access to inclusively designed innovative solutions, particularly those that can help them participate in the transition to Net Zero. Work programmes • Future Retail innovation: Consumer protection and participation; and • AI strategy Cross cutting Theme 5: working with partners to solve issues across multiple sectors’ This theme does not have standalone outcomes and specific work programmes. It will be relevant for all the work we are doing and is therefore a cross-cutting theme. Vulnerability definition Our definition of vulnerability is deliberately broad and recognises that vulnerability can be transient and multi-faceted. Some stakeholders suggest it could be narrower to focus on a smaller group of consumers, and others consider it should be broader to include financial vulnerability. We are not minded to revisit the definition at this time, however, we are keen to hear stakeholder views through this consultation. Helping to build trust in energy suppliers We recognise that energy suppliers have experienced challenges during the lifetime of our current Strategy. However, consumers have lower levels of trust in energy suppliers compared to other sectors. Our Consumer Confidence work will drive our work for all consumers, ensuring that suppliers are focused on delivering the outcomes we want to 8 Consultation – Consumer Vulnerability Strategy: Refresh see. However we also want to make sure there is a specific focus on consumers in vulnerable situations. We think therefore there is an opportunity to challenge suppliers on what they are doing for their consumers in vulnerable situations. We are proposing to chair annual Consumer Vulnerability Panels, at which energy suppliers will provide evidence of what they are delivering for their consumers in vulnerable situations. It will give suppliers the chance to show us good practice and importantly allow us to challenge them on where they could go further. We propose to publish a report setting out our findings, to help spread good practice and set out our expectations for the sector. Demonstrating our progress against the aims in the Strategy We did not report our progress against the outcomes in the current Strategy. We know that stakeholders want this visibility of our work, and how it comes together to help protect consumers in vulnerable situations. We propose creating a dedicated space on our website for a ‘live’ Strategy, which we will update as we deliver projects and priorities change. We will use this space to publish an annual workplan. It will also allow us to set out any work that we are deprioritising, and the reasons why. We propose to supplement this with an annual report setting out good practice, areas for improvements and key statistics, including Social Obligations Reporting data and evidence from consumer research. These would be set out under the themes and outcomes in the Strategy. We intend all of this to improve transparency on how the whole sector is performing against the strategic goals we have set, including Ofgem. This will help to hold us all to account for delivering against outcomes for consumers in vulnerable situations. The importance of working with our stakeholders We know we cannot meet the needs of vulnerable energy consumers on our own. We will work with government and all stakeholders, to help protect the interests of consumers in vulnerable situations. This includes through work on affordability and debt and our Consumer Confidence package on consumer protection. We welcome stakeholders’ views on our proposals. Please submit these to ConsumerVulnerability@ofgem.gov.uk or using our Citizens Space survey here https://consult.ofgem.gov.uk/energy-supply/consumer-vulnerability-strategy by 5 November 2024. 9 Consultation – Consumer Vulnerability Strategy: Refresh 1. Introduction This section sets out why we are consulting on a new Consumer Vulnerability Strategy. It also explains how stakeholders can respond, and our next steps. History of our Consumer Vulnerability Strategies Our primary duty is to protect current and future consumers. We have a statutory duty to consider the needs of people with disabilities, who are chronically sick, of pensionable age, on low income or living in rural areas. Statute also allows us to consider the specific needs of other groups of consumers. (See section 3A (3) Electricity Act 1989 and section 4AA (3) Gas Act 1986.) To translate this duty into our regulatory approach, in 2013 we published the first Consumer Vulnerability Strategy which examined the complex nature of consumer vulnerability, and our definition. (Consumer Vulnerability Strategy (ofgem.gov.uk)) In 2019 we published our updated ‘Consumer Vulnerability Strategy 2025’ due to widespread recognition that the energy market was going through great change with the impact of digitalisation, decarbonisation, and decentralisation. It set out 5 themes and 19 outcomes, along with the projects and work that we would take forward to help meet the outcomes. (Consumer Vulnerability Strategy 2025 | Ofgem) Why we are updating our Vulnerability Strategy Since the Consumer Vulnerability Strategy 2025 was published, the sector has experienced significant upheaval and price rises, particularly affecting consumers in vulnerable situations. Further, many consumers have found themselves subject to poor supplier practices (for example, involuntary installation of prepayment meters (PPMs). While we have established new protections (for example, Consumer Standards and Involuntary PPM protections) and welcome the steps taken voluntarily by suppliers (e.g. Winter Voluntary Debt Commitment), more is needed. Our approach needs to stay ahead of a rapidly developing sector and target action to ensure consumers in vulnerable situations are better protected and benefit from the growth of new products, services, and technologies. We therefore committed to refreshing our Consumer Vulnerability Strategy to be more targeted towards key outcomes and reflect a rapidly changing sector and evolving social and economic environment. What are we consulting on We are consulting on the content of a revised Consumer Vulnerability Strategy. It has four standalone themes, one cross cutting theme, and four high level outcomes. It sets 10 Consultation – Consumer Vulnerability Strategy: Refresh out proposals for annual Consumer Vulnerability Panels, and proposals on how we report our progress against meeting the aims of the Strategy. This document is split into six sections: • Chapter 1: Consultation process; • Chapter 2: Outcomes on a page – key things to know; • Chapter 3: Work we have delivered to help protect consumers in vulnerable situations; • Chapter 4: How vulnerabilities have changed since 2019; • Chapter 5: Revised Strategy themes and outcomes; and • Chapter 6: Increasing transparency and accountability. How our proposals contribute to our objectives Protecting the interests of consumers in vulnerable situations is our principal objective and aligns with our statutory duty. This work primarily aligns with our Multi-Year Strategy (MYS) Objective 2: Ensure high quality of service and helps to meet the MYS priority of “Continuing to prioritise vulnerable consumers, refreshing our Consumer Vulnerability Strategy to be more targeted towards key outcomes, and reflect a rapidly changing sector and evolving social and economic environment.” (Consumer Vulnerability Strategy 2025 | Ofgem) These proposals for a refreshed Vulnerability Strategy also aim to meet our Forward Work Programme (FWP) objective “to review our Consumer Vulnerability Strategy 2019- 25, to determine what further changes could support consumers in vulnerable situations.” (Ofgem’s Forward Work Programme – 2024/25 p.16) This sits under the FWP objective to “ensure vulnerable consumers are protected, and find the right balance of competition and regulation to drive up standards for all consumers. We need to hold suppliers to account, through monitoring, compliance and enforcement - as consumer needs, the system, and the market evolve.” Context and related publications The following publications are relevant to this consultation: • Consumer Vulnerability Strategy (ofgem.gov.uk) • Consumer Vulnerability Strategy 2025 | Ofgem • Forward Work Programme | Ofgem • Ofgem's multi year strategy • Consumer standards decision | Ofgem • Involuntary prepayment meter decision | Ofgem • The Winter 2023 Voluntary Debt Commitment - Energy UK (energy-uk.org.uk) • RIIO-3 Sector Specific Methodology Decision – GD Annex (ofgem.gov.uk) 11 Consultation – Consumer Vulnerability Strategy: Refresh Next steps The consultation closes for written responses on 5 November 2024. We expect to conclude and publish our final Strategy by the end of 2024/25. We are keen to hear from anyone with views on our proposals, so please send your responses to ConsumerVulnerability@ofgem.gov.uk or using our Citizens Space survey at https://consult.ofgem.gov.uk/energy-supply/consumer-vulnerability-strategy We have asked for your responses to questions throughout the document, so please respond to each one as fully as you can. Your response, data and confidentiality You can ask us to keep your response, or parts of your response, confidential. We’ll respect this, subject to obligations to disclose information, for example, under the Freedom of Information Act 2000, the Environmental Information Regulations 2004, statutory directions, court orders, government regulations or where you give us explicit permission to disclose. If you do want us to keep your response confidential, please clearly mark this on your response and explain why. If you wish us to keep part of your response confidential, please clearly mark those parts of your response that you do wish to be kept confidential and those that you do not wish to be kept confidential. Please put the confidential material in a separate appendix to your response. If necessary, we’ll get in touch with you to discuss which parts of the information in your response should be kept confidential, and which can be published. We might ask for reasons why. If the information you give in your response contains Personal Data under the General Data Protection Regulation (Regulation (EU) 2016/679) as retained in domestic law following the UK’s withdrawal from the European Union (“UK GDPR”), the Gas and Electricity Markets Authority will be the Data Controller for the purposes of GDPR. Ofgem uses the information in responses in performing its statutory functions and in accordance with section 105 of the Utilities Act 2000. Please refer to our Privacy Notice on consultations, see Appendix 3. If you wish to respond confidentially, we’ll keep your response itself confidential, but we will publish the number (but not the names) of confidential responses we receive. We won’t link responses to respondents if we publish a summary of responses, and we will evaluate each response on its own merits without undermining your right to confidentiality. 12 Consultation – Consumer Vulnerability Strategy: Refresh General feedback We believe that consultation is at the heart of good policy development. We welcome any comments about how we have run this consultation. We’d also like to get your answers to these questions: • Do you have any comments about the overall process of this consultation? • Do you have any comments about its tone and content? • Was it easy to read and understand? Or could it have been better written? • Were its conclusions balanced? • Did it make reasoned recommendations for improvement? • Any further comments? Please send any general feedback comments to stakeholders@ofgem.gov.uk How to track the progress of the consultation You can track the progress of a consultation from upcoming to decision status using the ‘notify me’ function on a consultation page when published on our website. Ofgem.gov.uk/consultations Once subscribed to the notifications for a particular consultation, you will receive an email to notify you when it has changed status. Our consultation stages are: Upcoming > Open > Closed (awaiting decision) > Closed (with decision) 13 Consultation – Consumer Vulnerability Strategy: Refresh 2. Refreshing the Strategy: Key things to know By refreshing the Strategy, we intend to: • Refocus ours and industry’s priorities to ensure that consumers in vulnerable circumstances are at the heart of company cultures and the right support and outcomes are delivered consistently. • Build an enduring, collaborative way of working to deliver and maintain sufficient focus on the needs of consumers in vulnerable situations. • Bring transparency to our priorities, work programmes, and expectations on companies. We are proposing to retain all five themes from the Consumer Vulnerability Strategy 2025, but consider that ‘working with partners to solve issues across multiple sectors’ should be cross cutting to reflect where the fact the Strategy can add particular value by bringing work and stakeholders together, rather than having specific outcomes attached to it. Our key immediate priorities are: • Working with government to tackle the growing affordability and debt challenges; • Identifying consumers in vulnerable situations through data sharing and PSR reform; • Improving customer service; and • Encouraging positive, inclusive innovation. Outcomes on a page Theme: Improving identification and smarter use of data Outcome: Vulnerable customers should have their needs identified, be able to easily notify and update their circumstances, have better understanding of and access to support services designed to suit their circumstances and meet their needs. Sub-outcome 1: Vulnerable customers to have minimal burden in notifying and updating energy companies of their circumstances Sub-outcome 2: Vulnerable customers should have sufficient understanding of and easy access to the support and services available to them, including via the PSR Theme: Supporting those struggling with bills Outcome: Vulnerable customers struggling to pay their bills should receive accurate bills that are easy to understand, compassionate and consistent support, and flexibility in payment methods and frequencies 14 Consultation – Consumer Vulnerability Strategy: Refresh Sub-outcome 1: Vulnerable customers should have accurate, easy to understand bills that support flexible payment methods and frequencies Sub-outcome 2: Vulnerable customers who are struggling to pay their bills, or are indebted, should have proactive and consistent affordability and debt support, that is delivered with compassion and understanding Theme: Driving significant improvements in customer service Outcome: Vulnerable customers should be provided with tailored communications that are easy to understand, able to engage with their energy company with ease and do not face exclusion based on their circumstances Sub-outcome 1: Vulnerable customers should be able to contact their energy company easily, their needs are accommodated and that they are not excluded due to language barriers or capability with digital tools Sub-outcome 2: Vulnerable customers should receive communications that are easy to understand and tailored to suit their needs Theme: Encouraging positive and inclusive innovation Outcome: Vulnerable customers should have access to inclusively designed innovative solutions, particularly those that can help them participate in the transition to Net Zero Sub-outcome 1: Vulnerable customers should have access to innovative solutions that deliver positive outcomes Sub-outcome 2: Innovative solutions should be inclusively designed to limit the barriers to take up or adverse outcomes for vulnerable customers 15 Consultation – Consumer Vulnerability Strategy: Refresh 3. Our work to protect and deliver for consumers in vulnerable situations In this section, we set out some of the work we have delivered for consumers in vulnerable situations since 2019. We also set out what we have seen from industry during this time. The first year of the Consumer Vulnerability Strategy 2025 In the first year of the Strategy, we committed to delivering several projects to help consumers in vulnerable situations. We set these out below, along with the progress we made against each one. Progress against year 1 Consumer Vulnerability Strategy workplan Analytical framework We developed a Distributional Impacts Framework (Assessing the distributional impacts of economic regulation (ofgem.gov.uk)) to help us understand how different policies may impact on a selection of different types of households and energy consumers. We also developed ‘Consumer Archetypes’ as an input to the framework. The Archetypes are segmented into distinct consumer groups, representing all households in GB. The Archetypes are used to investigate existing or proposed policy designed to help rebalance any policies which have been identified as unintentionally overlooking or disadvantaging certain households. (Consumer archetypes for Ofgem - Centre for Sustainable Energy (cse.org.uk)) Self-disconnection protections In 2020 we published our final decision on changes to rules to protect PPM customers at risk of self-disconnection. The new rules introduced requirements on suppliers to identify PPM customers who are self-disconnecting and to offer short-term support through emergency and friendly hours credit, as well as to offer additional support credit to PPM in vulnerable situations who have self-disconnected or self-rationed. (Self-disconnection and self-rationing: decision | Ofgem) Ability to Pay rules The self-disconnection decision also included enhanced requirements on suppliers to support all customers who are facing financial difficulties through the inclusion of updated Ability to Pay principles in the supply licence. (Self-disconnection and self- rationing: Decision | Ofgem) Gas Network vulnerability principle As part of the RIIO-GD2 vulnerability package, we introduced a new licence obligation to ensure domestic customers are treated fairly. Gas distribution networks (GDNs) must comply with Standard Special Condition D21, which places greater onus on the GDNs to 16 Consultation – Consumer Vulnerability Strategy: Refresh treat their customers fairly and, including customers in vulnerable situations and develop approaches that deliver fair outcomes for those customers. (RIIO-GD2 Fair Treatment Guidance (ofgem.gov.uk)). Future energy retail market In 2018, the Department for Energy Security and Net Zero (DESNZ) and Ofgem launched a joint review to investigate what policy, legal and regulatory changes might be needed to ensure the energy retail market is fit for the future. The joint review phase of the project is now over, with government and Ofgem taking forward policy making processes for our respective areas independently, but with close consultation.(Flexible and responsive energy retail markets - GOV.UK (www.gov.uk)) In 2020, we consulted on broadening our derogations regime and better enabling licensed suppliers for specific geographic areas or premises.(Supporting retail innovation: Policy consultation on ability to provide derogations from certain standard licence conditions; and, granting supply licences for specific geographic areas or premises types | Ofgem) Now the energy sector is more stable following the gas crisis we will be re-starting this conversation about how we unlock innovation and protect consumers as the market changes. We will continue to work with the new government to ensure that we have a coordinated strategy and approach for the future of the retail market. After year one Our work following these year one deliverables was less proactively focused on the specific outcomes for the Consumer Vulnerability Strategy 2025 due to impacts of the Covid pandemic and the gas crisis. We responded to the Covid pandemic and aimed to ensure that consumers in vulnerable situations were not adversely impacted in their energy supply by: • Taking a more flexible approach in our regulatory regime to ensure focus on preventing harm to consumers;(Impact of COVID-19 on retail energy supply companies – an enabling framework for regulatory flexibility | Ofgem) • Working with government to agree principles to support energy customers impacted by Covid;(Supplier_Agreement_19.3.2020.pdf (publishing.service.gov.uk)) and • Reallocating a proportion of funding from the Energy Redress Fund to fund emergency fuel vouchers.(Supplier_Agreement_19.3.2020.pdf (publishing.service.gov.uk)) Following the Covid pandemic, Europe moved into the energy and subsequent cost of living crisis. Energy prices rose sharply due to increased demand as countries emerged 17 Consultation – Consumer Vulnerability Strategy: Refresh from Covid, combined with supply shortages due to Russia’s invasion of Ukraine. Our work during this crisis included: • Delivering the EBSS and EPG schemes on behalf of government, providing relief on consumers’ energy bills. • Updating and monitoring compliance with the energy price cap which helped to protect consumers from unfair prices caused by the volatile gas market. (Energy price cap | Ofgem) • Protecting over 2.5 million customers during 30+ supplier exits since January 2021 through our Supplier of last resort (SoLR) process. (How you’re protected when energy firms collapse | Ofgem) • Agreeing Voluntary Commitments with Energy UK and suppliers for winter 2021 and 2023. (Energy sector offers helping hand - Energy UK (energy- uk.org.uk)) • Launching Market-wide Compliance Reviews into customers in payment difficulty, vulnerability and customer service. (Compliance and enforcement - Improving energy supplier performance for consumers | Ofgem) • Publishing good practice guides for treatment of customers in payment difficulty.(Good practice for supporting customers in payment difficulty | Ofgem)( Cost of Living Working Group - Joint Letter on Debt Collections | UKRN: the UK Regulators Network) More recently, and as noted above, we introduced new requirements for suppliers as part of our Consumer Standards work. This included new and updated rules: • • To make it easier for domestic customers to contact their supplier; For suppliers to prioritise contacts from the most consumers in vulnerable situations and their representatives; • To help provide support for domestic customers who are struggling with their energy bills, with more proactive contact consideration of debt repayment holidays; and • To compel suppliers to publish information on their customer service performance, as measured by Citizens Advice. (Consumer standards decision | Ofgem) In 2023 we also launched a package of work to investigate and improve supplier processes with Involuntary PPM. This resulted in a moratorium on installation, a Market Compliance Review (MCR), Code of Practice and new rules to transform how suppliers treat their customers struggling to pay their bills and in vulnerable circumstances. The rules include much greater prescription about how and when suppliers can proceed with 18 Consultation – Consumer Vulnerability Strategy: Refresh Involuntary PPM and provides examples of customer circumstances or characteristics where a PPM should not be deemed as safe and reasonably practicable. The rules also obligate suppliers to provide specific aftercare following installation and conduct regular reviews of the cases that are progressed. (Market Compliance Review: Remote mode switching and pre-payment meter warrant installations | Ofgem) (Involuntary prepayment meter energy supplier Code of Practice | Ofgem)) (Involuntary prepayment meter decision | Ofgem) Our work with suppliers as they restarted Involuntary PPM (having met strict restart criteria) has demonstrated the value of working collaboratively to support understanding and implementation of the rules we impose, and in delivering the right outcomes for consumers. Following our Vulnerability Summit in April 2023 we have made significant progress with sharing data across energy and water sectors. We have also made progress with government and other stakeholders on scoping a ‘tell us once’ or multi-sector PSR. The need to improve how industry identifies customers in vulnerable circumstances remains crucial and central to delivering the support those customers need. To ensure that our work protects the interests of current and future consumers, we conduct a range of consumer insight and behavioural science research with consumers to understand their perspectives and lived experiences and champion the consumer voice in our decision making. Examples of this include Consumer Attitudes to Involuntary PPM and Consumer Standards qualitative research. (Consumer attitudes to involuntary prepayment meter installation rule changes | Ofgem and Consumer standards qualitative research | Ofgem) (Consumer standards qualitative research | Ofgem) More recently, Ofgem conducted research to directly inform the future of our Consumer Vulnerability Strategy (Understanding the lived experiences of consumers in vulnerable circumstances | Ofgem) . This research aimed to explore, and bring to life, the contexts and lived experiences of consumers in vulnerable circumstances. The findings of this research were used to support recommendations on how to take the Strategy forward. Ofgem’s board, GEMA, also heard directly from consumers that participated in this research, to support the decision on next steps. Compliance and Enforcement From a broader compliance and enforcement perspective, we have undertaken significant programmes of work to ensure that energy companies are complying with their obligations. This has included MCR work on how companies identify and support consumers in vulnerable situations, and how they support customers in payment difficulty or debt. 19 Consultation – Consumer Vulnerability Strategy: Refresh The MCRs have led to improvements across several areas, including suppliers’ processes on identifying and supporting customers in payment difficulty. Updates on our MCR work can be found on our website.(Compliance and enforcement - Improving energy supplier performance for consumers | Ofgem) Separately to our MCR work, we have also undertaken compliance and enforcement investigations into energy company treatment of vulnerable customers. For example, we have opened investigations into compliance with smart meter roll out activities, treating customers fairly, obligations on the Priority Services Register (PSR), and billing and communications.(Compliance and enforcement - Investigations, orders and penalties | Ofgem) We have ensured that money companies pay into the Energy Industry Voluntary Redress Scheme is used to fund energy related projects to support vulnerable customers.(Three suppliers pay total of £8 million in relation to 'Guaranteed Standards of Performance' Final Billing Compensation failures | Ofgem)(Your guide to understanding the new redress scheme (energyredress.org.uk)) The Scheme, launched in 2018, has awarded over £100 million to fund over 500 projects across GB that support vulnerable energy consumers and carbon emission reduction initiatives. (Your guide to understanding the new redress scheme (energyredress.org.uk)) Infrastructure and Networks In Electricity Distribution (ED2), the Stakeholder Engagement and Consumer Vulnerability Incentive (SECV) was replaced by the strengthened and sharpened Customer Vulnerability Incentive (CVI). The CVI’s purpose was to ensure that Distribution Network Operators (DNOs) are held to account for delivering their vulnerability strategies and baseline expectations. We did this by setting key metrics which we then measured over time. The CVI drives performance in respect of increasing sign-up to the PSR, improving customer satisfaction in the delivery of services and measuring the value of services provided. In addition to the CVI, we also sought to protect consumers in vulnerable situations in ED2 by introducing a new principles-based licence obligation for networks electricity distribution licensees to treat domestic customers fairly. More recently, as part of our price control setting for RIIO-3 (RIIO-3 Sector Specific Methodology Decision – GD Annex (ofgem.gov.uk)) (which will apply from April 2026), we reviewed our approach to consumer vulnerability in the gas distribution sector, to ensure we protect and support those in vulnerable situations. In our RIIO-GD3 SSMD, we decided that the Gas Distribution Networks (GDNs) should continue to address 20 Consultation – Consumer Vulnerability Strategy: Refresh consumer vulnerability within their existing areas of competence, activity and consumer interaction. This role includes addressing issues of fuel poverty, carbon monoxide safety, and supporting a just transition to Net Zero. We are also mindful of our wider work in Ofgem looking at debt and affordability, and we will ensure these areas remain in alignment with each other. In our RIIO-GD3 SSMD, we also decided to retain the Vulnerability Minimum Standards, which include the Additional Services Licence Obligation for specified customer groups, a principles-based “Treating Domestic Customers Fairly” Licence Obligation, and the Guaranteed Standards of Performance (GSOPs). These will continue to protect consumers in vulnerable situations and to ensure that they are treated fairly. We also decided in our SSMD to retain the requirement for the GDNs to each maintain and update individual consumer vulnerability strategies, which are tested with diverse stakeholders and inform both their use of the Vulnerability and Carbon Monoxide Allowance (VCMA) and business as usual (BAU) activities. We made the decision to introduce a new requirement for GDNs to develop and maintain a high-level joint-GDN vulnerability strategy. This will help facilitate a more collaborative approach to anticipating, identifying and responding to vulnerability issues, and facilitate progress on cross-sector challenges like delivering a just transition and data use for vulnerability identification and action. The GDNs should ensure that the most up-to-date versions of their individual and joint-GDN strategies, including executive summaries, are easily accessible to stakeholders on their websites. In our SSMD, we decided to retain the VCMA in RIIO-3. The VCMA enables the GDNs to fund vulnerability projects and carbon monoxide safety initiatives that go beyond the BAU activities already funded through other price control mechanisms, or required through the license conditions. It is a use-it or lose-it allowance, with unspent funds returned to consumers at the end of the price control, and projects are mostly delivered in partnership with third sector organisations. The GDNs must produce individual and collaborative annual reports detailing their use of the VCMA and the progress of their VCMA Projects, and publish these on their websites. We will work with the GDNs and stakeholders ahead of RIIO-3 to further develop the VCMA to ensure it is sustainable and impactful for consumers in vulnerable situations. We decided in our SSMD to retain the financial output delivery incentives for Customer Satisfaction and the Complaints Metric, and intend to update the target scores to reflect and incentivise the GDNs’ continued high performance in these areas. To provide additional protection for consumers in vulnerable situations, we have decided to introduce new reputational output delivery incentives which will require the GDNs to 21 Consultation – Consumer Vulnerability Strategy: Refresh report on their Customer Satisfaction and Complaints Metric scores for customers on the Priority Services Register. Delivery of Government Schemes Throughout the lifespan of the Consumer Vulnerability Strategy 2025 we have continued to deliver and administer government schemes designed to tackle fuel poverty. Below we set out our role on the Warm Home Discount, Great British Insulation Scheme and Energy Company Obligation schemes. Key information on Ofgem’s role in WHD, GBIS and ECO WHD Purpose: The Warm Home Discount scheme (WHD) provides an annual, one-off £150 discount off energy bills for eligible households including those on low-income and who are vulnerable to cold-related illness or living wholly or mainly in fuel poverty. In addition to providing the £150 bill rebate, each participating supplier has a spending obligation towards Industry Initiatives. Ofgem’s role: Ofgem’s role is to administer the Industry Initiatives and facilitate suppliers’ compliance with the scheme. Key information: The scheme’s 12th year, which covered support delivered between 1 April 2022 and 31 March 2023, delivered over £443m in rebates to eligible households and £44.3m on industry initiatives that provided different types of support to fuel poor households. (Warm Home Discount Annual Report - SY12 | Ofgem) ECO Purpose: The Energy Company Obligation scheme (ECO) works by placing a Home Heating Cost Obligation (HHCRO) on medium and large energy suppliers. Obligated suppliers must promote measures that improve the ability of low income, fuel poor and vulnerable households to heat their homes Ofgem’s role: Ofgem’s role in administering the scheme includes allocating a proportion of targets to obligated suppliers, monitoring supplier progress and compliance and reporting to the Secretary of State. 22 Consultation – Consumer Vulnerability Strategy: Refresh Key information: ECO4 runs from 27 July 2022 to 31 March 2026. Over 500,000 measures have been delivered to eligible households to date. (Energy Company Obligation public reports and data | Ofgem) GBIS Purpose: Like ECO, the Great British Insulation Scheme (GBIS) places an obligation on medium and large energy suppliers. A minimum of 20% of GBIS obligations must be delivered to low income, fuel poor and vulnerable households Ofgem’s role: Ofgem’s role in administering the scheme includes allocating a proportion of targets to obligated suppliers, monitoring supplier progress and compliance and reporting to the Secretary of State. Key information: GBIS runs from 1 April 2023 to 31 March 2026. Whilst measure volumes have thus far been low, we have recently seen increases in delivery activity. What have we seen from industry In the lifespan of the Consumer Vulnerability Strategy 2025, we have seen good practice from energy companies to help support and protect consumers in vulnerable situations. While we recognise that there are areas of good practice across industry, there remains challenges with consistency of support offered across energy companies. We consider that more can be done to put consumers at the heart of company policies and ensure that consistently appropriate support is provided to customers in vulnerable circumstances. Collaboration and best practice sharing In 2020, Energy UK launched its Vulnerability Commitment, aiming to drive continuous improvement in standards over and above the expectations set out in licence conditions. The Commitment is based on three key principles: • Accessibility; • Collaboration; and • Innovation. 23 Consultation – Consumer Vulnerability Strategy: Refresh 13 suppliers have signed up to the Commitment, which covers around 90% of UK homes. (Vulnerability Commitment - Energy UK (energy-uk.org.uk)) As part of their annual assessments, good practice is identified and shared with industry. Energy UK published the most recent Vulnerability Commitment Good Practice Guide in 2023, highlighting good practices from the panel hearings and sharing industry-leading customer support. (Energy-UK Vulnerability Commitment- Good Practice Guide 2023) Involuntary Pre-payment Meters Ofgem has been monitoring suppliers’ handling of Involuntary PPM under the new licence conditions implemented in 2023. We have taken suppliers through a rigorous process prior to being given permission to restart to ensure that they had made appropriate changes to their processes. Through the monitoring of PPM customer journeys, we have seen that suppliers have put in place new processes to handle vulnerability during the PPM pathway, both as defined in the licence conditions as “do not install” or “further assessment needed” categories and where complex vulnerability is discovered. We have worked closely with suppliers throughout the monitoring processes and have seen their identification and handling of vulnerability within the Involuntary PPM process mature. They are keen to learn from each other and share best practice, which will be beneficial for all customers with vulnerabilities. Support for customers struggling to pay their bills In addition to offering hardship funds for customers who are struggling to pay their bills and/or in debt, some suppliers have partnered with third parties to help people with severe health conditions manage their energy bills by providing targeted support to ensure they live in a warm home. Others have also launched targeted debt support, such as schemes aimed at incentivising debt repayment by providing financial support that matches customer payments. Data Sharing A significant amount of progress has been made in sharing PSR data between utility sectors, thanks to the work of Water UK and the Energy Networks Association, with support from Ofgem, Ofwat and Energy UK. All DNOs had established data sharing agreements with local water companies by 2023, and the majority of suppliers have adopted the necessary legal changes to enable their PSR data to also be shared with water companies. We expect this project to be fully functional across all parties during 2025. Several companies have established relationships with projects looking to establish multi-sector data-sharing platforms, for example some network companies are working 24 Consultation – Consumer Vulnerability Strategy: Refresh with Northumbrian Water’s Support for All pilot, which aims to establish a ‘tell us once’ model of vulnerability data sharing. Some suppliers have also partnered with third parties to offer customers on the PSR free wellbeing checks to identify any additional health issues which may need support. (Support for All 2 - Ofwat Innovation Fund (challenges.org) We want to build on the good practice we have seen, and we set out proposals for how we could do this in chapter 6. 25 Consultation – Consumer Vulnerability Strategy: Refresh 4. Consumer Vulnerability This section sets out key information on vulnerabilities across Great Britain, and how these may have changed since we published the current Consumer Vulnerability Strategy 2025 in 2019. More detail on this is included in Annex 2. Questions Do you agree that we should not prioritise updating the vulnerability definition? Vulnerability definition We define vulnerability as when a consumer’s personal circumstances and characteristics combine with aspects of the market to create situations where he or she is: • significantly less able than a typical domestic consumer to protect or represent his or her interests; and/or • significantly more likely than a typical domestic consumer to suffer detriment or that detriment is likely to be more substantial. In developing our Consumer Vulnerability Strategy 2025, we looked at amending our vulnerability definition, first set out in 2013. We decided against changing the definition to make it more prescriptive and less dynamic as this would not do justice to the many types of vulnerable situations customers can face. The current definition retains a nuanced perspective of vulnerability, that recognises its transient nature. Risk factors for individual circumstances mean that vulnerability can be complex and multidimensional, and as such, we consider that changing the definition of vulnerability does not prevent, discourage or otherwise impact the outcomes we see for vulnerable customers. We also have received stakeholder feedback around defining financial vulnerability and including it in the vulnerability definition. Financial vulnerability remains a key focus for us and we have work to tackle specific issues such as energy affordability in train. We believe this is a better way of delivering outcomes for consumers in these circumstances than amending the definition to include financial vulnerability specifically. Qualitative research conducted with consumers demonstrated that some participants felt that the complexity of their circumstances required a more personalised approach to provision of support. (Understanding the lived experiences of consumers in vulnerable circumstances | Ofgem) We remain of the view that energy companies must put in effort to identify and support customers in vulnerable circumstances, even if that is challenging. Where self- identification and notification of consumer vulnerabilities or circumstances is required, we expect suppliers to allow consumers to do so easily. 26 Consultation – Consumer Vulnerability Strategy: Refresh Our broad definition ensures the energy sector is focusing on all aspects of vulnerability, and it does not prevent developing more specific definitions to target solutions to certain cohorts. We therefore propose that we do not focus on updating the vulnerability definition at this time. Our overarching focus is to deliver for consumers in vulnerable situations against the outcomes set out later in this chapter and concentrate on specific interventions. Q1. Do you agree that we should not prioritise updating the vulnerability definition? If you disagree and think that we should update the vulnerability definition, please provide reasoning for prioritising this activity. How vulnerability has evolved Our statutory duty requires us to consider the needs of people with disabilities, who are chronically sick, of pensionable age, on low income or living in rural areas. Vulnerability in the energy market is not solely related to affordability of energy. There are many factors that contribute to vulnerability and can increase the risk of detriment or harm to consumers being realised, such as health and mental health, poor literacy or numeracy skills, and digital or language exclusion. All consumers, in any market can be vulnerable to detriment. As set out above, our definition of vulnerability is intentionally broad to capture the dynamic and transient nature of vulnerability. We have seen economic factors exacerbate and stretch the nature of vulnerability over recent years. The Covid pandemic has contributed to an increase in long term health conditions and the cost-of-living crisis, including soaring energy prices, have contributed to an increase in customers struggling to pay their bills, which in turn can create and exacerbate health and mental health conditions. There are millions of consumers with characteristics of vulnerability in GB. It is crucial that we understand these vulnerabilities so that we can determine how best to protect their interests. Customer circumstances Disability There are around 16 million people in the UK with disabilities, representing 24% of the total population. (UK disability statistics: Prevalence and life experiences - House of Commons Library (parliament.uk)The proportion of the population reporting a disability has risen by 6 percentage points since 2002 (UK disability statistics: Prevalence and life 27 Consultation – Consumer Vulnerability Strategy: Refresh experiences - House of Commons Library (parliament.uk, data running up to FY 2021/2022)) In 2021/22 around 11% of children were disabled, compared to 23% of working age adults and 45% of adults of state pension age. The number of people in Great Britain entitled to receive a disability benefit has risen from 3.9 million in 2002 to 6.3 million in 2023 and is expected to rise further. (UK disability statistics: Prevalence and life experiences - House of Commons Library (parliament.uk)) In contrast, there are around 5 million with health conditions and disabilities in work. (Disability facts and figures | Disability charity Scope UK) However, disabled people are almost twice as likely to be unemployed as those without health conditions or disabilities. (Disability facts and figures | Disability charity Scope UK) Data shows that along with food, energy bills make up a larger proportion of expenditure for disabled households. (Cost of living for people with disabilities - House of Commons Library (parliament.uk)) Many disabled people need more heating to stay warm, in particular if they lack mobility, or use additional electricity to charge specialist equipment. (Out in the Cold | Disability charity Scope UK) Despite this, research suggests disabled people are more likely to live in a cold home. In November 2022, research suggested that 41% couldn’t afford to keep their homes warm compared to 23% of the non-disabled population. (Out in the Cold | Disability charity Scope UK) In 2020 the average disabled household faced around £975 a month in extra costs, if this figure is updated to account for inflation over the current period, these extra costs rise to £1,122 per month. (Disability Price Tag 2023: the extra cost of disability | Disability charity Scope UK) Long term health issues Self-reported long-term health conditions are increasing among working-age adults, especially since the Covid pandemic. The number of working-age people reporting at least one long-term health condition has climbed steadily, reaching 36% in the first quarter of 2023. This is a jump from 29% in 2016. (Rising ill-health and economic inactivity because of long-term sickness, UK - Office for National Statistics (ons.gov.uk)) Over 2.5 million people are now economically inactive due to a long-term health issue. This represents an increase of over 400,000 since the Covid pandemic began. For those unable to work due to long-term sickness, nearly two-fifths (38%) report having five or more health conditions; this is an increase from 34% in 2019. (Rising ill-health and economic inactivity because of long-term sickness, UK - Office for National Statistics (ons.gov.uk)) This suggests a rise in complex and interconnected health problems. 28 Consultation – Consumer Vulnerability Strategy: Refresh Pensionable age Our aging population likely means continued growth in long-term sickness inactivity in coming years (REAL Centre (health.org.uk)). In 2023, there were over 11 million people aged over 65 in GB. This is projected to increase by 10% in the next five years and by 32% by 2043. (Age UK briefing - State of Health and Care July 2023 (ageuk.org.uk)) In 2021, over 97% of residents aged 65 years and over, in England and Wales lived in private households. (Profile of the older population living in England and Wales in 2021 and changes since 2011 - Office for National Statistics (ons.gov.uk)) Rurality In 2020, 13.5% of households in urban areas in England (2.7 million) were fuel poor and in rural areas 11.7% (495,000) were fuel poor (ie where a household is living in a property with an energy efficiency rating of band D or below in a home that cannot be kept warm at reasonable cost without bringing their residual income below the poverty threshold). (Fuel poverty in rural areas - GOV.UK (www.gov.uk);) However, homes in rural areas are typically less energy efficient and can be more reliant on potentially expensive heating fuels. (Fuel poverty in rural areas - GOV.UK (www.gov.uk)) In England, around 12 million (21.3%) people live in predominantly rural areas, in Scotland 17% and in Wales, 32.8% of the population live in rural areas. (Statistical Digest of Rural England: 1 - Population April 2024 (publishing.service.gov.uk)) In these rural areas, more people are aged 50-59 years old than any other group. More than one in ten rural homes in England fail to meet the minimum standard set under the Housing Health and Safety Rating system and one in five fail to meet the decent homes standard. (Statistical Digest of Rural England: 1 - Population April 2024 (publishing.service.gov.uk)) (Statistical Digest of Rural England: 2 - Housing July 204 publishing.service.gov.uk)) Literacy and digital exclusion Around 8.5 million people in England, Scotland, Wales and Northern Ireland have very poor or lack basic literacy skills (Adult literacy | National Literacy Trust). Government statistics from its 2012 report also suggest that 49% of the working-age population of England have the numeracy level that we expect of primary school children. (2011 Skills for Life Survey: A Survey of Literacy, Numeracy and ICT Levels in England (publishing.service.gov.uk)) Around 2.1 million adults (4%) do not use the internet and around 4.4 million (8%) adults lack ‘some of the essential skills for life” like using email or search engines. (2023 29 Consultation – Consumer Vulnerability Strategy: Refresh Consumer Digital Index (lloydsbank.com)) There are a range of drivers for digital disadvantage. These can include, but are not limited to, factors such as low income, disability and impairments, age and education. (2023 Consumer Digital Index (lloydsbank.com)) Whilst smart meters are the foundation of a new energy system for domestic consumers, their "one-size-fits-all" approach might not benefit all users, particularly older adults. This demographic often faces an "age-based digital divide" when it comes to Information and Communication Technologies (ICT). (View of Too Old for Technology? How The Elderly of Lisbon Use and Perceive ICT | The Journal of Community Informatics (uwaterloo.ca)) Financial Vulnerability As the cost of living increased, so did the number of UK adults with low financial resilience, increasing from 11.9 million in February 2020 to 12.9 million in May 2022. In 2023, a report by Retail Economics and Grant Thornton showed that nearly nine out of ten adults plan to cut back on their spending. (The Cut Back Economy 2023.pdf (grantthornton.co.uk)) Most people had seen their financial position worsening; 7.8 million UK adults (15%) found paying their domestic bills or meeting credit commitments a heavy burden and over a third were finding it impossible or difficult to cope financially. (Financial Lives 2022 survey | FCA) While around 73% of adults reported having sufficient savings to cover a 25% fall in household employment income, ONS analysis between April 2018 and March 2020 found over a quarter of households could not. Households most likely to report this were: • • Lone parents with dependent children; Renters; • Households with a Black, African, Caribbean, or Black British head; • Households where the head had a routine or semi-routine occupation; and • Households where the head had a limiting disability or longstanding illness. (Impact of increased cost of living on adults across Great Britain - Office for National Statistics (ons.gov.uk) Fuel Poverty In 2023, there were an estimated 13.0 per cent of households (3.17 million) in fuel poverty in England under the Low Income Low Energy Efficiency (LILEE) metric, effectively unchanged from 13.1 per cent in 2022 (3.18 million). (Annual fuel poverty 30 Consultation – Consumer Vulnerability Strategy: Refresh statistics in England, 2024 (2023 data) (publishing.service.gov.uk)). For fuel poverty definitions across nations, please see England Fuel poverty statistics - GOV.UK (www.gov.uk) Scotland Fuel Poverty (Targets, Definition and Strategy) (Scotland) Act 2019 (legislation.gov.uk) and Wales Fuel Poverty in Wales - National Energy Action (NEA). The latest Scottish figures indicate that in 2022, an estimated 31.0% of all households were in fuel poverty, around 791,000 households. Higher than the 24.6% seen in 2019. Around 472,000 of these households (18.5% of all households) were living in extreme fuel poverty, higher than 311,000 in 2019. (Scottish House Condition Survey: 2022 Key Findings - gov.scot (www.gov.scot)) In 2021, 14% of households were reported to be in fuel poverty in Wales, with predictions of