Energy efficiency should be front and centre of our energy strategy
The government’s eagerly awaited Energy Security Strategy has finally been released, a welcome response to the Russian invasion of Ukraine.
Important though it is to wean ourselves off Russian gas, this is not the strategy’s only goal. Months prior to the war, wholesale gas prices skyrocketed and in February the energy regulator Ofgem announced a 54 per cent increase to the price cap. This has come into effect this month with devastating consequences for households.
Annual bills are expected to reach approximately £2,000 for the average household, even higher for customers on pre-payment meters, and a further rise is expected in October. National Energy Action (NEA) have said the rise has pushed an additional two million households into fuel poverty, totalling six and a half million.
If this wasn’t enough, the threat of climate change looms large, with the IPCC this week warning that even with current national commitments we are on track for 2.2 degrees of warming.
The reality is that because the government’s strategy focuses on the supply side, it’s missing a key tool in tackling all three of these crisis – insulating our draughty housing stock and electrifying domestic heating. The research is clear – this will reduce demand for Russian gas, save households vital money off their energy bills, reducing fuel poverty, and support our net zero target. It’s a triple win for government and households, which is why it is so disappointing to see reports that the Treasury blocked a £200 million uplift to the Energy Company Obligation (ECO) scheme.
Now is the time to go further and faster, not delay and downsize
Our largest energy efficiency scheme, ECO, will support over 200,000 low-income households with vital energy efficiency improvements and low-carbon heating installations in its first two years alone. Government have heeded MPs earlier warning on energy efficiency and we welcome the commitment to ECO, but now is the time to go further and faster, not delay and downsize.
We know that households in the least efficient properties have energy bills that are twice the cost of the most efficient homes. There is a statutory target to upgrade the energy efficiency of all fuel-poor households to EPC C by 2030 and all households to EPC C by 2035.
Government needs to ensure that it follows through with its existing commitments. Ensuring the ECO 4 legislation is prioritised in Parliament to maintain installation rates, making swift decisions on minimum energy efficiency standards in the rented sectors and meeting its manifesto commitment to spend £2.5 billion on the Home Upgrade Grant this Parliament.
Failure to invest in energy efficiency at the pace and scale required will leave hundreds of thousands – if not millions – of vulnerable households exposed to high energy costs this winter, at risk of ill-health. Ultimately, many will die as a result of living in a cold home. It also stifles our progression towards net-zero at a time when we should be accelerating.
The government is starting to get the message on renewables, it’s now time to recognize energy efficiency must be front and centre of our energy strategy this decade.
Ben Lake is the Plaid Cymru MP for Ceredigion and chair of the Fuel Poverty and Energy Efficiency APPG.
Get the inside track on what MPs and Peers are talking about. Sign up to The House's morning email for the latest insight and reaction from Parliamentarians, policy-makers and organisations.