We will all spend more on insulation, low energy light bulbs and other measures

Mr Benn, the Environment Secretary is going to require energy companies to spend more money on energy saving measures, such as insulation and low energy light bulbs with some scope for renewables.

Under the Carbon Emissions Reductions Target “CERT” (formerly known as the Energy Efficiency Commitment “EEC”), energy companies are obliged to spend an amount of money – it used to be £500 million a year but Mr Benn is proposing to double that amount – on energy efficiency measures.

The new CERT scheme permits a much greater range of measures than the old ECC did, so that now under CERT technologies such as solar heating can be included, although the prime expenditure will be on insulation and low energy lighting.

It is a good response to the problem of rising fuel prices and as 40% of the expenditure will be on the fuel poor, it will help this vulnerable section of our society.

The energy companies are obliged to spend this money on these measures and their expenditure is monitored by Ofgem, who have the power to fine the energy companies up to 10% of their turnover if they fail to make sufficient expenditure.

However, this is not largess by the energy companies. They pass on the costs of the expenditure to their customers, which have added around £30 to £40 a year to energy bills over the past three years. That is why the Government ensures that the expenditure is properly checked by Ofgem and why the fines for not complying are so huge. The energy companies are spending their customers’ money on these measures, so it is really another form of very indirect taxation.

I have never been sure whether the expenditure is best left to be organised by the energy companies – there seems to be a direct conflict of interest in asking them to spend money to ensure that we use less fossil fuel energy that they supply.

However it is clear that the expenditure does constitute the probably largest financial spending that we have as a nation on carbon dioxide emission reduction. It is right that we should not waste energy and insulation, for example, is a good way to prevent wasted energy which will lower emission rates provided that the people living in newly insulated homes do not turn the thermostat to a hotter setting.

However the expenditure is “spun” by Mr Benn (and I have yet seen the details as to whether it will actually eat into energy suppliers pockets) I welcome it as a positive environmental measure. It may add another £30 to £40 a year to your energy bill.

Finally, there is one thing I should point out. We are so used to special offers, discounts and so much off the price that I suspect that the genuinely subsidised CERT measures and in particular insulation, is treated by a marketing weary public as a “con”. It is not. You would be foolish not to take up subsidised insulation as a means of preventing energy waste because as an energy buyer, you have probably already paid for it several times over in the extra energy charges hidden in your bill and it ill save you money in the future.

You can get advice from you energy company about the various schemes they offer or call the Energy Savings Trust Hotline in business hours Mondays to Fridays at 0800 512012 or look at their website www.est.org.uk   

    

2 Responses

  1. I think the Dinosaurs who supply fossil fuel should not be allowed to control energy saving technology subsidy expenditure, I think a higher environment taxation 20% of these companies ( who are currently enjoying a very profitable year as energy prices rise) is required and the funds from this should be controlled by an accountable organsation with a mandate to subsidise domestic renawable energy.
    Maybe the nice people who sell the fossil fuels will not be happy until they max up the oil/gas price until there are scenes in the streets as featured in the movie “The Saint” where Ivan Tretiak cuts off the oil supply to the country.If they push, hopefully there will be someone like the beautiful Dr Emma Russell, to save the day with a technology to change the situation.

  2. Peter

    We are dependent on places like Russia and Norway for gas, as the natural gas we produce diminshes.

    When we had plenty of coal we sold it to the highest bidder and we cannot be surprised if Norway and russia do the same with their gas.

    Robert

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