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Huhne demands greater lagging effort from energy suppliers
A massive increase in the amount of home insulation installed across Great Britain is being kick started today, paving the way for the Government’s new Green Deal.
By properly insulating homes, people can save money on fuel bills, protect the warmth of their home and cut carbon emissions. It’s estimated the most energy inefficient homes in the UK could save, on average, around £550 per year by installing insulation measures.
Climate Change Secretary The Rt Hon Chris Huhne MP is today demanding that energy suppliers work harder to insulate lofts and walls ensuring that consumers, especially low income vulnerable households, receive measures which can offer significant energy bill savings.
Under the newly restructured Government obligation on energy companies (CERT - Carbon Emissions Reduction Target), extended from March 2011 until December 2012:
- 68% of energy suppliers’ work will now have to be met through professionally installed loft, cavity and solid wall insulation. With DIY insulation added, more than 80% of the scheme will be focused on insulation. Previously just 60% was met through professional and DIY work
- 15% of homes helped will be the lowest income households more at risk of fuel poverty
- energy companies will now be stopped from promoting compact fluorescent lamps in order to prioritise insulation, further to the total ban on light bulb mail-outs.
DECC will also consult this summer on whether to retain the subsidy for low carbon gadgets like eco-kettles, shower regulators and high efficiency appliances in place of even more homes being insulated.
The changes to CERT will mean some 3.5 million more homes across Great Britain are likely to benefit from insulation, building substantially on the 2.5 million homes treated under the scheme since April 2008.
The Rt Hon Chris Huhne MP said:
Our plans will give a huge boost to the insulation industry during the economic recovery as we pave the way for the start of the Green Deal. This is the beginning of a massive and urgent increase in home energy insulation for the nation. We are demanding that energy companies work harder to make homes warmer, more environmentally friendly and cheaper to run, especially for those who need it most.
The government announced in the Queen’s Speech that it is to introduce legislation which will enable households to finance more expensive measures like solid wall insulation with no upfront costs. Through the Green Deal, energy efficiency work could be repaid through a charge on a home’s energy meter offset by the savings made on fuel bills, meaning many householders will benefit from day one. This Green Deal is expected to be available in late 2012.
National Insulation Association Chief Executive, Neil Marshall, said:
We welcome this bold move by Government and recognition of the critical role that insulation has to play in reducing energy bills and tackling climate change. The introduction of a minimum level of insulation that must be carried out by the energy suppliers along with other changes such as stopping the promotion of CFLs will ensure that there is a major increase in the amount of insulation undertaken. This will provide significant benefits to householders and a much needed boost to our industry enabling us to plan and be ready for the introduction of the Green Deal in 2012.
Director of the Association for the Conservation of Energy, Andrew Warren, said:
This decision provides an important step towards refocusing the long-standing energy efficiency obligations upon energy companies. It breaks new ground, by mandating a minimum percentage of investment for one specific energy saving option - in this case, insulation.
Notes to editors
- CERT is an obligation placed by Government on gas and electricity suppliers to deliver a reduction in household carbon savings across England, Scotland and Wales. It aims to help ensure the UK meets its statutory carbon reduction targets. In helping households take up energy efficiency measures, it helps more households benefit from reduced energy bills and increased thermal comfort alongside increased security of supply from reducing energy demand and local air quality benefits.
- By extending the Carbon Emissions Reduction Target to December 2012 an additional 108 million tonnes of CO2 will be saved with annual savings by the end of the scheme, equivalent to 2% of current household emissions. It is expected that suppliers will need to invest around £2.4 billion on energy efficiency to meet this target.
- CERT requires suppliers to focus at least 40 per cent of their activity on a ‘Priority Group’ of vulnerable and low-income households including those in receipt of eligible benefits and pensioners over the age of 70 by increasing the energy efficiency of these households. 15% of homes helped under the 40% will be the lowest income households more at risk of fuel poverty. It will focus on older poorer households and low income families and disabled groups including Pension Credit claimants, Child Tax Credit recipients under a £16,190 income threshold, income-based Job Seeker’s Allowance, income-related Employment and Support Allowance (that includes a work-related activity or support component) or Income Support, and one of the following:
- pensioner premium
- disability or severe disability premium
- award of child tax credit that also includes an element for a disabled, or severely disabled, child or young person
- child under the age of five
- Assuming suppliers pass all their costs on to consumers in their energy bills then the average annual supplier cost per consumer bill will be £50 under the extension compared to £41 under CERT now, meaning an additional £9 to consumer bills per year to 2012 only. All households will have an opportunity to benefit from measures which can deliver energy bill savings significantly beyond these costs.