We need a social tariff to avoid a winter emergency every year

David Buttress, CEO of OVO

Featured in September 2025’s New Statesman issue

As the nights draw in, the reality for millions of households becomes grimly familiar: colder homes, rising debt, and difficult choices. This is not a new crisis; it happens every year – and unless the government acts, it will keep happening.

Here’s the reality: UK homes are some of the hardest hit by fuel poverty in the developed world. Britain’s fuel poverty problem has become structurally embedded. Energy prices may have come down from their crisis peak, but they are still far higher than they were just a few years ago – and for many households, the pain never went away.

We talk about global shocks and price volatility like they are temporary, but gas prices are still unpredictable and heavily influenced by geopolitics. Meanwhile, the UK remains one of the most exposed countries in Europe, because of how we heat our homes, how we structure our bills, and how little we’ve done to protect those who need the most help.

Half of homes in England and Wales have an EPC rating of D or below – typically these properties are inefficient, leaky and costly to run. And while other countries are rolling out clean, efficient solutions like heat pumps, we’re still wedded to gas boilers. That means every time there’s a global price shock, UK households are hit harder, and the most vulnerable suffer.

At the same time, the tools we’re using to fight fuel poverty are outdated and poorly targeted. The Warm Home Discount, for instance, costs £1bn each year and delivers just £150 per household – a fraction of what’s needed when the average fuel poverty gap is now more than £400 per household. Even more strikingly, the support is funded through bills, which means low-income households who don’t qualify for help are still footing the cost.

This approach is not just inefficient–it is regressive and unfair. If we’re serious about fixing this problem, we need a new social contract on energy. And at the heart of it must be a targeted, social tariff.

A well-designed social tariff would ensure those on the lowest incomes pay a fairer price for the energy they need. It would replace the patchwork of temporary schemes with something that is progressive, automatic and enduring. It would also give certainty to households, to suppliers and to the government.

We’ve done this before. Labour governments have a proud track record of introducing bold, targeted welfare policies that transform lives. Tax Credits lifted millions of children out of poverty. Pension Credit ensured dignity in retirement. Sure Start invested in families when it mattered most.

A social tariff would build on that legacy, applying the same principles of fairness, automatic support and targeted help, this time to one of the most basic human needs: staying warm in your home.

New research by Green Alliance, supported by OVO, shows just how transformative this could be. A properly implemented social tariff, when combined with stronger minimum energy efficiency standards in rented homes, could lift over half of all fuel-poor households out of poverty. That is the scale of the opportunity.

The government’s Warm Homes Plan is a welcome step, but it will not be enough on its own. We need long-term solutions, not short-term patches. A social tariff is not the only answer, but it is one of the most effective tools we have, and we should start using it.

Winter isn’t a surprise: it comes every year. This winter should be the last one where millions are left out in the cold.