An inefficient Bill

Following the publication of the draft Energy Bill, Paul Suff asks what happened to the government's pledge to improve energy efficiency across the UK?

The draft Energy Bill has not provided all the answers many were hoping for; potential investors will have to wait a little longer for the kind of certainty they require before deciding whether to contribute to the £110 billion needed to update and, in part, decarbonise UK electricity generation.

But, while the Bill was short on detail in some areas, one issue was almost completely ignored. There is just one reference to the need for energy efficiency in the 307-page document, and that only refers to the Green Deal and the roll-out of smart meters.

It’s not clear, as WWF points out, whether the planned reform of the electricity market will include incentives to improve efficiency, so encouraging people and organisations to reduce demand. Or, as the Chemical Industries Association notes, if energy-efficient technologies, such as combined heat and power generation, will be given financial support alongside nuclear and carbon capture and storage.

Given that one-fifth of existing generating capacity is due to close over the next decade, the government needs to create the conditions quickly for a secure and, hopefully, decarbonised electricity supply. But lowering demand should also feature highly in the reform of the market. As the UK Energy Research Centre (UKERC) pointed out in 2009, reducing energy consumption plays a key role in any energy-secure, low-carbon future.

The three main aims for the Bill are security of supply, sufficient investment in low-carbon technologies, and generating maximum benefits from minimal cost. UKERC reported that energy efficiency could reduce the costs of decarbonising the UK’s power sector by up to £70 billion by 2050. And most experts would acknowledge that the fastest and cheapest way to bring down carbon emissions is by ramping up energy efficiency.

Given the absence of energy efficiency from the draft Energy Bill, much is now riding on the Green Deal to help reduce electricity demand. That might be a big ask, as there is mounting concern that widespread take-up of the scheme is unlikely to materialise.