Addressing a seminar in Adelaide today - Mr Callum McCarthy, the Chief Executive Officer of the United Kingdom Office of Gas and Electricity Markets Authority (OFGEM) - said such consideration was necessary to address the likelihood of "fuel poverty".

In the United Kingdom, those households which need to spend 10% or more of their disposable income in order to keep comfortably warm - defined as 21°C in a residence's living areas and 18°C in other areas of the home - are considered to be in "fuel poverty".

Mr McCarthy was delivering the keynote address to a Fuel Poverty & Low Income Energy Consumers seminar held in Adelaide today - exactly six months ahead of South Australia's move to a free retail market for electricity for the State's 760,000 households and small businesses.

Recounting the United Kingdom's own experience in moving to competitive retail markets for electricity and gas, Mr McCarthy noted that "in the year 2000, there were four million households in Great Britain in fuel poverty".

"Of those, three million were 'vulnerable' households with children, or headed up by an older, disabled or chronically sick person," Mr McCarthy said.

"Three in five members of these families living in fuel poverty are aged 60 or over," he said.

"Fuel poverty can lead to death with around 40,000 'excess winter deaths' recorded in the United Kingdom each year."

Contributing factors

Mr McCarthy said the main factors leading to fuel poverty were low incomes, high fuel prices and energy inefficient homes.

"The risk of fuel poverty is increased if you live in a rural area, do not have access to the gas network, live alone, your home has solid walls or you live in private rented accommodation," he said.

In the United Kingdom, the Authority - the country's electricity and gas regulator - had begun a sustained campaign to combat fuel poverty by working in conjunction with government, social housing providers and social action groups to: Help reduce fuel prices; make households more energy efficient; and introduce industry initiatives such as special electricity and gas payment plans for the elderly.

Mr McCarthy said that from 1996 to 2000, the Authority's domestic energy efficiency program had helped 1.5 million people break out of the fuel poverty cycle.

Initiatives in the program included installing loft and cavity wall insulation in 400,000 fuel poor homes at no charge to the household, and providing appliances, heating controls and energy efficient lightbulbs at no cost.

Mr McCarthy said that overall, one million of the households were saved from fuel poverty by a fall, in real terms, in fuel prices.

"Lower energy prices are the single most important factor in reducing fuel poverty," he said.

About 100 people are attending today's Fuel Poverty & Low Income Energy Consumers: The U.K Experience & Issues for South Australia seminar - hosted by the South Australian Independent Industry Regulator.

This is a joint initiative between the South Australian Council of Social Services and the Council of the Ageing (S.A.), and is funded by the Office of the South Australian Independent Industry Regulator.