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Energy Efficiency Innovation Review (2005)

Energy Efficiency Innovation Review (2005). Summary report: http://www.hm-treasury.gov.uk/media/FB4/AE/ pbr05_energy_675.pdf Domestic sector: http://www.est.org.uk/uploads/documents/aboutest/Household%20energy%20efficiency%20action%20for%20a%20low%20carbon%20society.pdf.

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Energy Efficiency Innovation Review (2005)

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  1. Energy Efficiency Innovation Review (2005) • Summary report: http://www.hm-treasury.gov.uk/media/FB4/AE/ pbr05_energy_675.pdf • Domestic sector: http://www.est.org.uk/uploads/documents/aboutest/Household%20energy%20efficiency%20action%20for%20a%20low%20carbon%20society.pdf

  2. Energy Efficiency Innovation Review (2005) • Launched – pre-budget report (2004) • Published Dec 2005 • Defra, HM Treasury, Carbon Trust & Energy Saving Trust • An input to the wider review of the UK Climate Change Programme • Purpose • Examine how a step-change in energy efficiency (domestic, business & public sector) can be delivered cost effectively • How can energy efficiency improvements be embedded into decision making across the economy • ‘Innovation’ – technical & policy innovation

  3. Focus • Includes • How to deliver demand side efficiencies • How to increase the uptake of existing energy-efficient goods and services • How to accelerate the development of new, energy-efficient technologies • Excludes: • Transport • Energy services • The scope for local and regional delivery • Assessments • Potential energy & carbon savings projected to 2010 and 2020 • Role of new technologies – up to 2050

  4. Energy intensity of EU countries in 2003 (tonnes of oil equiv/million EUR GDP at 1995 market prices)

  5. UK position – consumer products • UK/EU leads energy performance standards for washing machines & dishwashers • Good energy performance standards & best practice standards for heating demand reduction – not world leader • Patchy coverage • other white goods, heating products • Limited/no coverage • consumer electronics, domestic lighting, cooking, ICT • UK/EU – few performance standards for motors, drives, commercial lighting • No UK/EUI minimum standards for commercial air conditioning & lighting • UK/EU few endorsement standards, little best practice coverage • except domestic boilers, gas water heaters, domestic heating, demand reduction and ICT • Where standards are in place – 40% standards lead world wide.

  6. UK carbon emissions • UK good progress on reducing greenhouse gas emissions • On course for meeting Kyoto Protocol • 12.5% reduction in gg emissions below base year by 2008-12 • ‘Significant effort needed’ to meet domestic 2010 goal • 20% reduction of CO2 below 1990 levels • Revised emission projections – 10% below 1990 levels by 2010.

  7. Household Sector • Responsible for 40MtC/year (30% UK total) • Space & water heating 75% • Lights & appliances 25% • Scope to deliver 9MtC of cost-effective savings by 2020 • 7.5MtC from measures tackling space and water heating • 1.5MtC from appliances • Two types of decisions impact on energy efficiency investment • (in addition to low or no cost behavioural measures) • One-off measures driven by energy saving • Eg retrofit insulation or heating controls • Purchase or replacement of fittings/appliances • Decision to purchase not driven by energy saving • But scope to purchase high efficiency option • Potential carbon emission similar but levers to influence decisions are very different

  8. Energy Efficiency Commitment (EEC) • Electricity and gas suppliers are required to achieve targets for the promotion of improvements in domestic energy efficiency. • Environmental aim • will contribute to the Climate Change Programme by cutting greenhouse gas emissions • Social aim • EEC will also contribute to the alleviation of fuel poverty. • 50% of energy savings must be focussed on a priority group of low-income consumers in receipt of certain benefits and tax credits/pension credit. • Eleven suppliers were set a target of 62 TWH in 2002 apportioned according to number of customers • 1 M homes loft/cavity wall insulation • 750,000 energy efficient appliances • 450,000 condensing gas boilers • 36 M low energy lamps • All obligated suppliers met their energy saving targets or went beyond them

  9. Several key challenges • Current programmes deliver their savings through social housing • By end of decade the improvement of social housing insulation will be exhausted • Need to find ways to deliver to owner-occupiers & private landlords • Lack of focus on behaviour/ how to incentivise behavioural change • Reduce heating hours, internal temperature, lighting levels and appliance usage • Current physical measures will reach saturation point early to mid next decade • Need to draw in new physical measures • Solid wall insulation, low carbon technologies, high insulation products

  10. Options for new or expanded policies on buildings: supplier obligation (EEC) • An effective route to drive energy efficiency take-up • Access to consumer is a key factor in delivering carbon savings • Further increase in target is feasible - 50% increase on the current phase • 2 barriers • Cost perception gap – customers have poor knowledge of costs and benefits of measures • Distrust of supply chain • How can EEC and other measures facilitate an increase in the uptake of energy efficiency measures • Move from a market which provides units of energy to one that addresses the heating, lighting and power needs of the consumer • Cost effectiveness not a key driver for installing insulation • Up-front costs, reliability and reputation of installer, perceived ‘hassle factor’, personal recommendation • Supplier cap and trade scheme – after 2011 • Move away from installation of physical measures towards direct delivery of carbon or energy targets • Energy Consumption feedback • Cost effective • Accessible real time displays • Smart metering • (Energy End-use Efficiency and Energy Services Directive)

  11. Building Regulations • Most consistently effective policy • Further tightening in 2010 • Opportunities will decline after 2010 • Further improvements – low carbon technologies • Solar water heating, small-scale renewables, micro-CHP, heat pumps • Need to reduce costs • Builders Obligation • Sustainable Building Code for a small proportion of houses built by volume house-builders • Drive down costs of new technologies by increasing market penetration • Compliance with Building Regulations • Study of 99 new houses • Third failed to achieve recommended level for air tightness

  12. Consumer Goods • Appliances & lighting - 20% household energy goods • Long term energy and cost saving do not drive consumers decisions electrical goods • Price is key factor • Personal recommendation • Where energy label exists the energy rating an important factor • But fewer A+ & A++ products sold in UK • Domestic lighting • Market misalignment • Financial benefits not regarded as important • Poor quality lights & fittings • Lack of product information & mandatory standards • Lack of compatibility • More scope for minimum energy performance standards & energy labelling schemes • EU level • Up-rate labelling & standards for white goods • New product standards and labelling information on consumer electronics & lighting

  13. Business & public sector

  14. Business & public sector

  15. Studies feeding into Energy Efficiency Innovation Review

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