Driving home the energy efficiency message

In mid-May, the government announced that it would accept the recommendation of the Committee on Climate Change (CCC) and commit the country to reducing its carbon emissions by 50 per cent (from 1990 levels) by 2025. This is a significant ramping up of the action against climate change. After all, the 2020 target is 34 per cent and if that target is met then a great deal of the much-talked-about ‘low hanging fruit’ will already have been picked.

The CCC suggested where many of these savings could be made. One of the main areas of focus is the built environment. In the report it compiled on how to continue to reduce emissions in the coming years, the committee devoted one chapter to ‘Reducing emissions from buildings and industry through the 2020s’. Emissions from buildings currently account for 36 per cent of the UK total. Their previous analysis identified scope for a 35 per cent reduction in building emissions by 2020, primarily through energy efficiency improvement and increased deployment of renewable heat.

Into the future
Looking beyond this, the committee identifies a further 74 per cent reduction in building emissions (relative to 2007) by the year 2030. Insulation will still play a major part (though mainly external and internal wall insulation as most roofs and cavity walls will have been treated by then) but so will technology. In particular, it highlights the potential for reducing indirect (i.e. electricity-related) emissions through the use of energy efficient appliances and lighting. This assumes that options like energy management have already been deployed by 2020 in appropriate buildings – and not just those included in the CRC.

The Energy Services and Technology Association (ESTA) has been stressing the need to look at these areas. They are cost-effective and – even before the Green Deal kicks in – there are a number of third party financing options to help organisations implement energy efficiency programmes. And the health sector is an attractive area for these organisations as it is relatively low risk.

Government focus
ESTA is concerned that, despite such opportunities, the emphasis from government remains resolutely on decarbonising energy generation rather than on resource-efficiency.

Speaking at the ESTA Energy Summit in London in May, the Liberal Democrat spokesman on climate change in the House of Lords, Lord Teverson, argued that we need to take energy efficiency much more seriously if we are ever to achieve a sustainable energy future for the UK. He added that by really embracing energy efficiency and cutting consumption, it will be much less expensive to construct the low-carbon energy supply system we need for the future.

Add to this the cost savings to consumers as well as the employment opportunities for low carbon industry and it looks distinctly odd that the emphasis remains on the supply side.

There are, though, one or two signs that the message may be finally getting through. The government has just announced the establishment of an Office of National Energy Efficiency, although details are still awaited. It is to be part of the Department of Energy and Climate Change (DECC) to provide a “wider energy efficiency strategy, strong programme management, and a cohesive view of DECC’s customer facing policies”.

Meanwhile, the Carbon Trust and Energy Saving Trust have had their core grant funding removed from 2012-13, and the government has said that it expects them to compete for services put out to tender while also developing new commercial opportunities. These will include services provided under the umbrella of the Green Deal, which will be the main vehicle for delivering energy efficiency programmes over the coming years. The government has said that it wants the services that underpin the scheme to be the subject of competitive tendering.

In a recent speech at a conference organised by Climate Change Capital, Deputy Prime Minister Nick Clegg also suggested The Green Investment Bank may have a role to play in delivering energy efficiency, particularly in the non-domestic sector.

However, given the range of policy streams and programmes, it can be difficult for organisations to work out practically what is the best, most cost-effective, way forward. The way the energy markets are organised in this country is currently being revised by Parliament, while the powers of the regulator, Ofgem, are also being reviewed and upgraded. At the same time as the government pushes forward with its climate agenda, heavy industry is pushing back against further carbon taxation – with some success given Chris Huhne’s promise to introduce measures to protect it against foreign competition. Energy can often seem to be a maze of conflicting policies.

The European picture
It is not just the UK where action seems unfocused. Giles Chichester is president of the European Energy Forum, conservative member of the European Parliament (MEP) and conservative spokesman on the European Parliament’s Energy Committee. Speaking at the ESTA Energy Summit, he remarked on the lack of attention to energy efficiency in the overall mix of policy aiming at a low carbon economy. “Energy efficiency is the low hanging fruit of European energy and climate change policy yet we have failed to grasp it,” he said.

Ultimately, though, the essentials remain the same. Only using what you absolutely need – i.e. being efficient – is good for the organisation’s balance sheet and also the environment. It reduces vulnerability to price volatility and there is plenty of that at the moment given the political realities in the Middle East. As Robin Teverson says, a sustainable energy supply is one that is resource-efficient.

The urgency to move forward on carbon savings remains, so we need to take action now. Indeed, the CCC believes that the buildings sector will have to be zero carbon in total by 2050 if the UK is to meet its commitment to an 80 per cet cut in emissions by then. So if we are aiming to become a sustainable, low carbon society in the very near future, energy efficiency is the place to start!

The Energy Services and Technology Association (ESTA) represents over 100 major providers of energy management equipment and services across the UK.

For more information
www.esta.org.uk