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UTILITY WEEK | 17TH - 23RD APRIL 2015 | 19 Next week: Manifestos under scrutiny E L E CT I O N C O U N TD O W N : 2 0 D AY S TO G O T he "negawatt" anyone? Former climate change minister Greg Barker was a fan. "The era of negawatts has finally arrived," he pro- claimed as the Energy Bill was still making its way through parliament. The negawatt is a theoretical unit of power representing an amount of energy saved as a result of energy conservation or increased energy effi- ciency. Indeed, as the European Union commissioner for energy and climate action, Miguel Arias Canete, said in February: "[The] energy we do not use is the cheapest, most sustainable, and most secure energy we have." The UK has had state-organised energy efficiency schemes since 1994, when we saw the launch of the energy efficiency standards of performance (EESoP). The latest iteration is the Energy Company Obligation (Eco), accompanied by the able-to-pay scheme, the Green Deal. The latter has soundly failed to live up to expectations with only 10,846 households signed up to plans in the two years since it was launched. Barker famously said he wanted 10,000 plans by the end of its first year or he wouldn't sleep. Meanwhile, Eco, was fettled and changed in order to provide a £50 cut to bills last winter. The scheme has also insulated more than 1.1 million properties over the past two years. Labour claims the coalition's insu- lation plans are failing, and leaving the fuel poor helpless. They have unveiled a grand plan to insulate 500,000 homes a year, focus- sing on the poorest households. This pitches it, somewhat conveniently, at the same level as Eco, although shadow energy secretary Caroline Flint insists Labour's scheme will be much more successful. She told Utility Week: "We're clear we're working towards 200,000 homes a year of people in fuel poverty or in danger, and they'll be whole house retrofits. We don't want to come back time and time again to paper over the cracks that haven't been done." However, the offers being put for- ward by the main parties, continu- ing with the Green Deal and Eco, or Labour's energy efficiency plans, is not enough for many outside observers. Campaign group Energy Bill Revo- lution is calling for a radical over- haul of the way energy efficiency is delivered to households. It wants the carbon tax to fund a national infra- structure-style retrofit programme for households. So far, 255 MPs have signed up backing the scheme, but it seems unlikely to be adopted, espe- cially with the carbon tax revenue des- perately needed by the Treasury. All the parties understand the ben- efits that increased energy efficiency can have. It may not be sexy, but it is important for cutting the UK's emis- sions and reducing bills. The trick the new government will have to pull off is delivering a pro- gramme without placing more of a burden on the suppliers, and therefore the customers, to pay for the scheme. Savings from nothing The cheapest and most reliable unit of energy is the one you don't use. Energy efficiency When utility bills are not paid by choice, rather than not being paid because the customer is unable to, the shortfall has to be footed by the companies, and therefore spread across the rest of its customer base. In the water sector, the companies are losing an estimated £1,635 million a year in outstanding and unpaid bills. This equates to an average of an additional £15 per household. The forthcoming Ofwat review into affordability, due out in the autumn, is expected to reveal that this figure has increased, placing more of a burden on consumers, and pushing even more into water poverty – where 3 per cent of household income goes on water bills. The better known cousin of water poverty is fuel poverty, where 10 per cent or more of household income goes on energy bills. The latest government statistics showed that 2.28 million households were in fuel poverty in 2012. And within the energy sector, Uswitch.com estimates that four million households are in debt to their supplier, owing a collective £464 million. With the average dual fuel energy bill coming in at £1,264 a year, and the average water and sewerage bill at £393, and these expected to rise in the medium to long term, the pressure on helping people pay and reduce their bills is growing. This is a growing concern for utilities, which will be le more and more out of pocket unless this growing deficit is closed. Social policies and efficiency measures can go some way to closing the black hole in utilities' finances, but with government incentive costs and levies being added to bills, pushing them up, the next government will be under pressure from consumers and companies to address the affordability agenda. This will in turn help ensure customers pay, reducing the pressure of bad debt on the companies. Bad debt Can pay, won't pay Energy Efficiency Standards of Performance (EESoP) 1: 1994 to 1998 EESoP2: 1998 to 2000 EESoP3: 2000 to 2002 Energy Efficiency Commitment (EEC): 2002 to 2005 EEC2: 2005 to 2008. Carbon Emissions Reduction Target (CERT): 1 April 2008 and 31 December 2012 Community Energy Saving Programme (CESP): 1 September 2009 and the obligation period ran from 1 October 2009 to 31 December 2012. Eco: Energy Company Obligation (ECO): 1 January 2013 to 31 March 2015 Eco2: 1 April 2015 to 31 March 2017 Green Deal: January 2013 onwards £50 Eco costs £50 per household per year £38 Cert costs households £38 per year ENERGY EFFICIENCY SCHEMES: HOW MUCH?