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The Importance of Energy Efficiency for Net-zero Emissions

A new Committee Report for the Department for Business, Energy and Industrial Strategy (BEIS) has highlighted shortfalls in UK energy efficiency policy across various sectors. Since the UK government committed to a 2050 net-zero greenhouse gas emissions target, all sectors of its economy are coming under greater scrutiny to develop emissions reductions strategies. Energy efficiency is among the more cost-effective arenas for decarbonisation, but there has been a nearly decade-long slump in investment in it. The report highlights investment and infrastructure, home retrofits, new homes, and commercial buildings as areas for policy focus in energy efficiency and gives policy recommendations for each.

Investment and infrastructure in energy efficiency are low per capita in the UK compared to the rest of Europe. While the UK has set energy efficiency targets through its Energy Performance Certificate (EPC) Band C targets, the government is unclear on how much public spending is needed to meet them.

The UK’s housing stock is among the more energy inefficient in Europe. Consequently, more than one in ten households are considered fuel-poor[1]. The government’s main initiative to reduce fuel poverty, and thus improve energy efficiency, is the Energy Company Obligation (ECO), which funds retrofits. However, it suffers from a lack of funding and has a focus on low cost rather than need. It is unsuitable as the government’s only fuel poverty and major household energy efficiency scheme. The BEIS Committee recommends that retrofits be planned at central and local levels in addition to the supplier-led ECO. Additionally, new homes often underperform by their advertised energy efficiency standards and can be sold as such because of loopholes in the Building Regulation. The Committee recommends that all newly built properties must have their as-built energy efficiency assessed and published.

Lastly, the report considers energy efficiency in commercial buildings. Businesses in the UK are mostly not aware of the energy efficiency targets of the UK or believe they will not be met. The Committee recommends that commercial energy efficiency standards be raised and that operational performance ratings be introduced for businesses.


 

[1] The UK defines fuel poverty as follows: when a household’s fuel costs are above the median level, and it were to keep warm, the household is left with a residual income below the poverty line.

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Nick Fedson MEng MSc

Carbon Compliance Analyst at Alfa Energy
Nick is an analyst with an interest in energy, climate, and sustainability. Nick maintains both technical and policy interest in these areas, with an undergraduate background in mechanical engineering from the University of Bristol and a recently completed Master’s degree in Global Energy and Climate Policy from SOAS, University of London. He has completed internships in a solar energy consultancy in Brighton, a not-for-profit independent think tank in New Delhi, and in data analysis at a software company in Cambridge.

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Nick Fedson MEng MSc

Nick is an analyst with an interest in energy, climate, and sustainability. Nick maintains both technical and policy interest in these areas, with an undergraduate background in mechanical engineering from the University of Bristol and a recently completed Master’s degree in Global Energy and Climate Policy from SOAS, University of London. He has completed internships in a solar energy consultancy in Brighton, a not-for-profit independent think tank in New Delhi, and in data analysis at a software company in Cambridge.