UK Government ups the ante on domestic energy efficiency

Instead of leaving it to the electricity regulator to set targets, the Government has included provision in the Utility Bill (see related story) for it to decide how much improvement in domestic energy efficiency electricity suppliers should achieve. It has also proposed expanding the energy efficiency efforts of utilities by allowing them to improve not only electric-heated homes but the efficiency of the majority of UK homes, which are heated by gas.

Last week – when Deputy Prime Minister John Prescott outlined the UK’s proposed Climate Change policy (see related story) – plans for Energy Efficiency Standards of Performance (EESOPs) for the period 2002-2005 were also published. The plans have been put out to consultation, with the following proposals included:

• 53 terawatt hours fuel savings between 2002-2005 in UK domestic energy consumption, which would result, by 2005, in an 11 terawatt reduction (about two percent of 1998 levels)
• 50% of EESOP 4 energy savings would have to be met by improving the efficiency of householders in receipt of one or more income or disability benefits
• electricity supply companies would be encouraged to “pay special attention to ‘near benefit’ consumers” when attaining energy savings from the remaining 50% of households

“The obligation for EESOP 4 is certainly ambitious,” Mish Tullar of the Electricity Association told edie. Despite the tough targets, the Electricity Association is happy with the Government’s plans for EESOP 4. In particular, the Association is pleased to see gas-heated homes becoming eligible for energy efficiency assistance. According to Tullar, there have been huge improvements in the efficiency of electric-heated homes since the EESOP programme began in 1994 and there is little left to do. “With the obligation now on gas-heated homes we can make great strides,” says Tullar.

But what about expanding the range of measures electricity suppliers offer to consumers to improve their homes’ efficiency? The Government says that it’s happy for companies to continue to introduce measures such as cavity wall insulation, loft insulation, hot water tank insulation, higher efficiency appliances, high efficiency light bulbs and the like, but it also wants to see innovation. It suggests:

• collaboration with house builders offering new or refurbished housing with high levels of insulation
• collaboration with house builders on developments with high-efficiency community heating
• domestic CHP in individual properties
• development of ever-more energy efficient appliances

The Electricity Association’s Mullar concedes that new ways of improving homes’ efficiency should be explored but that most companies are sticking to the tried and tested methods. “There are some ‘sexy’ proposals like domestic CHP and doubtless there is a lot that can be done in that area, but it remains to be seen where funding will come from for some of these initiatives,” says Mullar.

In addition to the higher targets, the Government’s EESOP 4 proposals introduce competition into the energy efficiency market. Not only will electricity suppliers continue to compete with each other for customers, they will also compete with each other for the households where they achieve improved energy efficiency. “A company may, if it wishes, offer EESOP programmes to consumers other than their own, and earn EESOP score through them,” says the Energy efficiency standard of performance, 2002-2005 consultation document.

EESOP’s focus on lower-income and pensioners’ homes will remain. In this way, the EESOP programme is one of the UK’s best examples of ‘sustainable’ policy, where anti-poverty measures combine with environmental concerns.