UK public believes low energy prices send wrong signal regarding efficiency

Following the publication of the Government’s Performance and Innovation Unit (PIU) report on the future of energy supplies in the UK (see related story), the Department of Trade and Industry commissioned a series of consultations with energy stakeholders and the general public.

The research has revealed that cost is one of the biggest concerns in the UK regarding energy, but energy supply is taken for granted due to the reliability of current supplies. There was strong support for energy efficiency and renewable energy, and many respondents were concerned that the Government’s focus on lower prices might be sending the wrong message about using energy efficiently.

The PIU’s report, published in February, called for a 20% increase in renewable energy by 2020 and a 40% rise in domestic energy efficiency by the same time, and also noted that the door should be left open for nuclear power and clean coal technology. However, last month the Institute of Chemical Engineers criticised the report’s ‘dubious’ predictions for long-term energy prices and for having an overriding faith in the ability of the liberalised market to hold prices down (see related story). The Institute also noted that current low energy prices are stifling the development of cleaner renewable energy sources.

The Government’s New Electricity Trading Arrangements (NETA) have also been heavily criticised for the negative impact on small – often renewable – electricity generators, many of whom have had to be shut down due to cripplingly high costs (see related story).

In 2000, the Royal Commission on Environmental Pollution stated that the UK needs to achieve a target of 60% of the nation’s energy consumption over the next 50 years. Secretary of State for Trade and Industry Patricia Hewitt agrees.

“It’s already quite clear that action on that scale is what is needed,” said Hewett, announcing the publication of the results at the seventh annual Greenpeace Business conference. “There is no doubt we need a massive step-change in investment in renewable energies.”