The Clean Growth Strategy – Where Are We One Year On?

Last October, The Guardian headline read “UK climate change masterplan – the grownups have finally won” with Energy Minister, Claire Perry’s “Ambitious, broad and binding” renewed aspiration and ambition for energy efficiency in the guise of the Clean Growth Strategy. This announcement saw MIMA and the Energy Efficiency Infrastructure Group’s (EEIG’s) aspirational target of bringing homes up to EPC C by 2035 being publicly supported by the Energy Minister and the Government. Now where are we almost one year on? Was this purely an aspiration or are we seeing some real, long-awaited action? Were the voices of doom and gloom, right?

Firstly, it is important to remind ourselves how much we have achieved, how far we have come and how, through the efforts of the EEIG, we are continuing to see significant progress and serious ambition with a huge boost on energy efficiency policy given by government and policymakers:

  • The Prime Minister, Theresa May has made a significant pledge to “halve energy use in new buildings by 2030” and halve costs for existing buildings. Nor surprisingly little detail on the how but we DO have a commitment from the very top.
  • The National Infrastructure Commission has made energy efficiency a national infrastructure priority and its first NIA has asked for 21000 insulation measures a week by 2020 – a six-fold increase. Whilst the final report was a little deflating it was nevertheless advocating significant spending on social housing; a “quick win” in the words of the NIC’s, CEO Phil Graham.
  • The Clean Growth Strategy has pledged to bring all homes up to EPC C by 2035 and all fuel poor homes to C by 2030 with BEIS working with us and working hard to find policies and money to support this objective.
  • The Green Finance Taskforce makes positive recommendations for energy efficiency including financial incentives for meeting EPC C 2035 target on all buildings and suggesting Capital Infrastructure Plan for government for objectives such as energy efficiency.
  • We have secured the support of MPs – with cross party consensus in Parliament on the need for a national energy efficiency infrastructure plan. Simply there are a growing number of cross party MPs supporting and championing our aims and realising the impact of positive measures on voters.

Fast & Furious

To some extent action has not been as fast and furious as we want (dare I say lackadaisical on occasions!) and tumbleweed has been spotted in the policy arena but this ambitious, reinvigorated and much needed spotlight on energy efficiency in Westminster provides us with vital opportunities. It has been demonstrated that the UK has substantial energy efficiency policy capability and experience
spanning decades clearly capable of doing better, a lot better but this needs to be supported by capital investment and effective, well-organised delivery. We must ensure that the enormous remaining potential for energy efficiency and specifically the potential to slash household energy demand by 50% is realised.

The track record and trends speak for themselves, even in the context of 2 million more households, gas and electricity demand has fallen by 21% and 13% respectively since 2004. In 2017, energy bills were £500 lower than they would have been without energy improvement measures – thanks to insulation, and increasingly efficient boilers and household appliances. But we must not allow the trend to buck – it is fact that the rate of insulation installations is down 95% compared to 2012. A warning that must be taken seriously.

Capitalise on Momentum

Now is an important time to capitalise on momentum for greater ambition. Given energy efficiency’s central importance, it is up to us, as an industry, with our partners to convince government how to effectively drive greater demand for energy efficient renovation – including the harnessing of the £27.6 bn market for housing repair and maintenance.  Government is not oblivious to the fact that the annual public and private investment needed to 2035 is £5.2bn. Public investment in 2017/18 was £0.7bn. Eek, this leaves an annual gap of £4.5bn.

Other countries such as France, Germany, the Netherlands and Scotland have all demonstrated that combinations of policies and public investment that are far more effective at raising renovation rates and unlocking more private investment. This is what the EEIG is grasping with both hand in its 2018 strategy and activity plan. We believe the EEIG and its members play a crucial part in any future success. 

We Need to Support BEIS

It is important to realise that BEIS is committed to energy efficiency improvements but is held back by HM Treasury constraints – the department holding the purse strings. Whilst we cannot eradicate the political uncertainty and, in the context of Brexit, the fact that Treasury is holding back major spending decisions, they are gradually changing their thinking on environment & energy. Through the EEIG we need to support BEIS in presenting the case to Treasury as well as driving the cause across government departments – with Ministry of Housing, Communities and Local Government, with the Department of Health – facilitating cross-departmental cooperation and improving their thinking and understanding on energy efficiency.

So, let’s be mindful of progress and remind ourselves that incremental policy steps are being taken by Government and along with the strong recommendations from the Green Finance Taskforce that would enable the financing of home energy improvements mainstream. Let’s park the doom and gloom for now, we just have to be patient. We must “softly, softly, catchy monkey”.

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