Fuel Poverty in New Zealand

The concept of fuel poverty emanated out of grass roots environmental health movements in the UK in the early 1980s. In recent years it has been taken on board by the UK Government in as much as they have committed to eradicate it by the middle of this decade. A household is in fuel poverty if it would need to spend more than 10% of the total household income on all household fuels to achieve a satisfactory indoor environment. The satisfactory indoor environment is defined as being at temperatures of at least 21 degrees Celsius in the living areas and 18 degrees Celsius in other parts of the house. The number of households in fuel poverty in the UK has been variously estimated at somewhere between one million and seven million with a median acknowledged by the Government of around three million in 2001. This number would mean some 14% of the population in the UK was in fuel poverty at that time. The present paper suggests that in NZ the number of households in fuel poverty in 2001, using the same definition of adequate indoor temperatures as for the UK, is very similar, with a range of between 10% and 14% of the total households. Background Fuel poverty is a concept that arose out of grass roots energy action groups in the UK and Ireland during the early 1980s. This was a time when the oil price hikes of 1974 and 1979 produced fuel cost increases which in turn led to large heating bills for residential consumers. The poorer consumers suffered more than others in terms of having to pay a larger percentage of their total income to keep warm. The first definition of the concept was a fuzzy notion: “The inability to afford adequate warmth in the home” as given by Lewis in a submission for the National Right to Fuel Campaign in Bradford UK (Lewis1982). Later, Brenda Boardman, in her doctoral thesis and her groundbreaking book on fuel poverty (Boardman 1991) expanded the concept to include the effect of energy inefficient housing. The idea was roughly that households which would need to spend more than 10% of their income on all household energy fuels in order to achieve a satisfactory indoor heating regime were categorized to be in a state of fuel poverty (Clinch and Healy 2001). The key idea here is that the fuel cost is attributed to what they would need to spend, not what they actually spend. The early definitions lacked precision both in terms of adequate economic parameters and in terms of the thermal parameters. Even today the definition is debated both in terms of what constitutes an adequate thermal environment and what constitutes the total household income. Despite the definitional debates, fuel poverty has been taken on board by the UK government in their current strategy to combat the health effects associated with cold homes (DEFRA 2001). The problem in the UK has been particularly politically sensitive due to historical poor levels of housing quality and their nearness to better housed and cooler northern neighbors. Household fuel poverty is currently defined in Britain (DEFRA 2003) as the need to spend more than 10 per cent of annual household income on ALL household fuel use. The heating fuel component of the household fuel use should be sufficient to enable the home to achieve a satisfactory heating regime (see below). The household energy use excludes transport, lawn mowers, boats and other recreational energy use not specific to that used within the residential building itself. The UK definition assumes that a satisfactory heating regime is one where the main living area is at 21°C, with 18°C in other occupied rooms. It is assumed that heating is available for 16 hours per day for households likely to have occupants home all day, and 9 hours per day for households in work or full time education. It is also assumed that the whole house is