From 2002 to the end of 2017, total energy consumption in the UK fell by 10 percent
– and this despite the population rising by 19% from 55 million to over 66 million
in the same period. This was achieved, in part, by increased energy efficiency.
To meet the legally binding target, laid down in the Climate Change Act 2008
, of reducing the UK’s greenhouse gas emissions by at least 80% below base year levels by 2050, more has to be done to reduce the use of hydrocarbons for energy. Improving energy efficiency is one of the major potential solutions.
What government policies and regulations exist in the UK to make us more energy efficient?
At the EU level: Energy Efficiency Directive (EED)
There are over 200 results
on the UK legislation site relevant to the Energy Efficiency Directive, including many recently laid before Parliament due to Brexit
Article 7 of the Energy Efficiency Directive sets a target for 1.5 percent annual reduction in energy sales to end users through the end of 2020.
The UK’s approach for complying
with Article 7 is set out for the period 2010-2020; and the progress of the UK’s national energy efficiency action plan
is reported annually. The April 2017 report indicated that since 2007, industrial energy consumption fell by 23%; household energy consumption fell by 12%; passenger transport consumption fell by 8% (although passenger kilometers increased by 6% since 2014); and road freight transport decreased by 3%.
Article 8 of the EED is discussed in further detail below.
UK Building regulations
The Building Regulations 2010
“are minimum standards for design, construction and alterations to virtually every building. The regulations are developed by the UK government and approved by Parliament.”
- The installation of cavity wall insulation
- Work affecting the thermal elements, energy status or energy performance of a building.
Part L of the Building regulations
concerns conservation of fuel and power
. It lays down the maximum heat conduction, or U-values, for roofs, walls, floors and windows for new buildings, and alterations to existing buildings.
New public buildings
of the Building Regulations sets out that new buildings should be nearly zero-energy, and in a circular letter of 14 January 2019
, the Ministry of Housing, Communities & Local Government informed building control bodies of the requirements that new public buildings should be nearly zero-energy.
Who makes sure Building Regulations are complied with?
Local authorities have the duty of making sure that any building work in their area complies with the Building Regulations. Advice can be found for homeowners, professionals such as architects and builders, and local authorities on the Local Authority Building Control website
Energy Performance certificates (EPCs)
The Building Regulations indicate that EPCs are required for new and modified buildings. They are also required when a property is sold or let, and have to be carried out by an accredited person
Energy Savings Opportunity Scheme (ESOS)
The ESOS Regulations 2014
are the UK's implementation of the EU Energy Efficiency Directive Article 8 (4 to 6)
. These regulations make it mandatory for UK organisations employing 250 or more people, or with an annual balance sheet total in excess of 50 million euro (£38,556,700), to carry out annual audits
. The audits must include an estimate of total energy consumption covering buildings, industrial processes, and transport, and must identify energy saving opportunities. However, there is no regulatory requirement for organisations to implement
the energy saving opportunities identified.
Enhanced Capital Allowance (ECA) scheme for energy-saving technologies
Businesses can benefit from tax breaks when investing in eligible energy-saving equipment
. Plant and machinery that demonstrates a high standard of energy efficiency has been independently evaluated across 17 separate technology categories. Purchases of the equipment receive accelerated tax relief by claiming a 100% capital allowance in the year of purchase.
Lighting and other energy-using products
Energy-hungry incandescent light bulbs have been unavailable for purchase in the UK since 2009 and halogen light bulbs were gradually phased out from 2016 and completely banned for sale from October 2018.
Resources for those overseeing lighting upgrades can be found in the EI's Lighting Guide.
CRC Energy Efficiency Scheme and its successor
The CRC (Carbon Reduction Commitment) Scheme
, introduced by BEIS and the Environment Agency in July 2015, aimed to incentivise energy efficiency and cut emissions in large energy users, in the UK's public and private sectors, by making them buy allowances
for every tonne of carbon they emit.
Domestic energy efficiency
Energy Company Obligation (ECO) Scheme and fuel poverty
Tax incentives and grants for energy-saving products in homes
For some energy-saving products, such as loft insultation, a reduced rate of 5% VAT
is charged. There are also reduced VAT rates for certain qualifying people for installation of heating appliances.
However for most people, VAT at 20% is still levied on home improvements such as double-glazing and energy efficient boilers.
The government is requiring the energy suppliers to offer each of their customers a smart meter
by the end of 2020 (although customers can refuse to have one installed). The idea is that people will be able to see how much energy they are using, and what it is costing, in real-time, thereby enabling them to better manage their energy use.
Fuel tax for vehicles
It could be argued that the high percentage of duty and VAT on road fuel
has encouraged the design of more energy efficient vehicles as well as a reduction in journeys. However, the rate of duty per litre (eg, 57.95p for unleaded petrol) has remained unchanged since 2011, with the 20% rate of VAT static since 2012.
What for the future?
Having begun to address large organisation efficiency through ESOS, in his Spring Statement
in March 2019, the UK Chancellor of the Exchequer set out the government’s intentions including plans concerning energy efficiency for smaller businesses:
An Energy efficiency scheme for small and medium sized businesses: call for evidence
has been launched by BEIS for the period 13 March 2019 – 8 May 2019, to “help smaller businesses reduce their energy bills and carbon emissions…to explore how [the Government] can support investment in energy efficiency measures”. And on 13 March 2019 the UK Government opened a competition
which is making available up to £6m of funding for the development of new business models that allow for the aggregation and scaling up of delivery of small-scale energy efficiency building projects in the commercial industrial sectors
The Chancellor also stated “to help ensure consumer energy bills are low and homes are better for the environment, the government will introduce a Future Homes Standard by 2025, so that new build homes are future-proofed with low carbon heating and world-leading levels of energy efficiency”.
UK government’s Industrial Strategy Challenge Fund
UK government’s Industrial Strategy Challenge Fund
, being delivered on behalf of the UK government by UK Research and Innovation, aims to “strengthen UK science and business innovation and take on the biggest challenges that society and industry face today.” This includes ensuring that the UK prospers from the energy revolution
including moving to a low-carbon, more resource-efficient economy. As reported in May 2018, £102.5 million will be invested in developing smart, clear energy systems.
Energy efficiency in buildings
- Links to guidance, regulation, research, policy papers and consultations on the subject from BEIS, Ministry of Housing, Communities & Local Government, DEFRA, Cabinet Office, etc.