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Five more years: energy efficiency

While the flagship Green Deal scheme has now financed over £50 million worth of improvements, the new Government will have to look wider to tackle energy efficiency across the UK economy.

While the flagship Green Deal scheme has now financed over £50 million worth of improvements, the new Government will have to look wider to tackle energy efficiency across the UK economy.

Energy efficiency received little mention in the Conservative manifesto, save for two notable pledges; to ensure that every home and business has a smart meter installed and that one million additional homes are insulated by 2020.

Domestic

For the domestic energy efficiency market, the landscape is unlikely to deviate far from the plans set out in the previous Parliament, with support set to focus on the already established Green Deal scheme.

New figures from the Green Deal Finance Company (GDFC) show that the pay-as-you-save scheme is starting to show signs of good health, with over £50 million of finance now in place to fund energy efficiency improvements. 

More than 550 households now make applications for Green Deal finance each week and £21 million worth of applications has been received by the GDFC in the past six months. 

However, the future of domestic energy efficiency policy is in need of clarification, with the much larger Energy Company Obligation (ECO) scheme slowing down considerably ahead of its 2017 deadline and new figures showing that the annual number of households installing insulation has dropped by 67 per cent since 2010.  

“Home retrofit has probably been the single biggest disappointment and frustration of the last five years…this is where we’ve got our work cut out”, said John Alker, director of policy and communications at the UK Green Building Council (UKGBC).

Non-domestic 

In the non-domestic market, the Energy Saving Opportunity Scheme (ESOS) will be the Government’s main focus for large business, with £250 million of annual energy savings potentially up for grabs and the first audits due by December 2015. 

Other pre-established mechanisms such as Climate Change Agreements (CCAs) and the CRC Energy Efficiency scheme will continue to be in place for large business, while the Government’s Energy Demand Reduction (EDR) pilot may also provide an opportunity to bid for funding in return for delivering electricity savings at peak times.

However, the picture for SMEs is more complex. Calls for a re-launch of the Green Deal in the non-domestic sector to help encourage take-up by businesses are yet to be answered, with most funding opportunities confined to the Feed in Tariff (FiT) and Renewable Heat Incentive (RHI) schemes.

However, SMEs that rent their property may soon benefit from new Private Rented Sector Energy Efficiency Regulations, announced in February 2015. 

The regulations, described by Alker as “the single most significant piece of legislation to affect our existing building stock in a generation”, mean that commercial properties must meet minimum energy performance standards of E or higher to be lettable from April 2018.