A: Excluding people does reduce the headline cost, but risks leaving millions who need support without it. It’s a false economy given health costs, and the apparent “saving” ends up as excess profits for energy giants rather than helping squeezed households. And schemes face range of other issues:
They generally mean big savings for big users, whilst those in dangerously underheated homes are often given less help. Judging people’s needs based on how much energy they have used in the past is intrinsically unfair and positively dangerous. Many people who need a lot of energy have used very little because they cannot pay for it. That doesn’t mean they should be deprived in the future!
Eligibility is a big issue. People in great need often miss out completely because they don’t fit the specific criteria chosen. Income £1 too high, or variable due to self-employment, or incorrect government data, or flawed disability assessments, or any of the other well-known problems! And some people don’t claim the benefit – which is a huge issue with pension credit. Overall, we don’t trust the government to solve these many complex challenges any time soon.
Cliff-edges. Some schemes offer big discounts e.g. 50% to some whilst giving 0% to someone earning £1 more per year, which is obviously totally unfair.
Lack of energy security. They provide zero guarantee for those suffering from energy starvation and underheating their homes. A discount is not much use if you don’t have the money to benefit.
Lack of energy efficiency incentive. Discounts encourage high energy usage and undermine energy efficiency improvements.