Evidence mounts of looming gap to meet both fuel poverty and climate targets

By Matt Copeland, Policy Manager

Today the Government have updated energy and emissions projections for greenhouse gas emissions and energy demand from 2018 to 2035. Unfortunately, the new analysis shows the legally binding fifth carbon budget could be missed by 10%.

Figure 2.3 from “Updated Energy and Emissions Projections 2018”

Many organisations have recently highlighted one area where more progress must be made is the household energy efficiency sector. In February the Committee on Climate Change showed that none of their energy efficiency key indicators required to meet the second carbon budget (non-traded sectors) have been met.

Table 1 from Letter sent from Lord Deben to Claire Perry MP on 15th Feb 2019

NEA has also noted that domestic energy efficiency installations have dropped to their lowest point since 2008 (and possibly beyond that) in the last quarter of 2018. This comes at a time when the Government’s Committee on Fuel Poverty have also been underlining the shortfall in investment required to meet the 2020 and 2025 milestones to ensure the legally binding 2030 fuel poverty target is met.

As noted by the CCC, CFP and Professor John Hills’ Independent Review of Fuel Poverty, Climate and Fuel Poverty Targets are not independent of each other. If we meet our 2030 Fuel Poverty Target, we will be well on our way to meeting the 2030 climate target, as a significant number of homes will be insulated to an acceptable standard. That’s one of the reasons why NEA believes that the Government should listen to the recommendations of the Committee on Fuel Poverty, and allocate £1.0 billion funding to a new ‘Clean Growth Challenge Fund’ to run from 2019-2021, to meet the 2020 milestone. The 2025 milestone could be met with an extension of this challenge fund, if £1.8bn is allocated for the period 2022-2025.

This challenge fund would essentially amount to an energy efficiency delivery scheme, to compliment and compensate for the weaknesses of the only energy efficiency scheme in England, the Energy Company Obligation (a scheme that is funded through energy bills). Any new scheme should leverage key learnings from energy efficiency delivery for low-income households in the devolved nations of Northern Ireland, Scotland and Wales where area based and self-referral schemes exist.

Action needs to be taken to solve these two challenges, and taken quickly. This year, a comprehensive spending review will allocate budgets to all Government departments to ensure they can execute their strategies and meet targets. This represents a golden opportunity to invest in energy efficiency in order to meet the 2020 Fuel Poverty Milestone and get us back on track towards meeting the fifth carbon budget. Beyond meeting binding targets, this will also help achieve other important UK Government goals; a successful industrial strategy, supporting small business growth in every region, help improve local air quality, reduce health and social care costs and provide real benefits to households who are struggling financially.

 

 

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