As talks aimed at securing a global climate deal kicked off in Copenhagen today, UK energy and climate change secretary Ed Miliband announced steps in the UK aimed at helping householders make their contribution to cutting emissions. The government's Energy Bill, also has its second reading in the Commons today.
Homeowners in Birmingham, Sunderland, the London Borough of Sutton and Stroud will be testing out new ways to finance whole house energy makeovers under the government's £4m Pay As You Save scheme. Following an open competition, Birmingham City Council, Gentoo Sunderland, British Gas, B&Q UK and Stroud District Council have been chosen to deliver individual projects in the first ever UK trials.
The Home Energy Pay As You Save pilots will give households the opportunity to invest in energy efficiency and microgeneration technologies in their homes with no upfront cost. Householders will make repayments spread over a long enough period so that repayments are lower than their predicted energy bill savings, meaning financial and carbon savings are made from day one.
A total of around 500 homes across England will take part in the trial which will provide evidence of how to foot the bill for the Great British Refurb – the government's plan to make the 22 million existing homes in the UK more energy efficient.
Energy and climate change secretary Ed Miliband said: "The next two weeks in Copenhagen are crunch time for the planet. The UK has taken a lead in putting solutions on the table throughout the process so far and I'll not rest until we have the most ambitious, effective and fair deal possible.
"Our credibility abroad is based on our ambition at home. We're the first country to put carbon targets into law, and our target of an 80% reduction by 2050 is one of the most ambitious.
"Many British householders want to reduce their emissions, but are put off by the upfront cost of installing insulation, solar panels or ground source heat pumps. Pay As You Save will trial different ways of paying for this work so it's affordable.
"One quarter of the UK's total emissions come from homes, so householders have to be a part of the solution to climate change. Increasing the energy efficiency of homes not only helps reduce emissions, but will also help reduce fuel bills."
DECC is keen to learn whether the PAYS scheme is attractive to consumers and how, in the medium term, it could be a method for enabling more householders to invest in the energy efficiency of their homes.
The Energy Bill, which receives its second reading in the Commons today will:
Protect vulnerable households
– providing mandatory social price support, such as in the form of an electricity bill rebate. This builds on the success of the voluntary agreement with energy companies which ends in 2011 and has helped reduce the fuel bills of more than one million vulnerable customer accounts. The level of support to be provided through the new mandated scheme will be greater than the £150m committed by suppliers in the final year of the agreement.
– Making absolutely clear Ofgem, the energy market regulator, must:
– include the reduction of carbon emissions and the delivery of secure energy supplies in their assessment of the interests of consumers
– step in proactively to protect consumers as well as considering longer term actions to promote competition.
– Giving Ofgem additional powers to tackle market exploitation where companies might take advantage of constraints in the electricity transmission grid.
– Strengthening the deterrent nature of Ofgem's powers by extending the time limit from 12 months to 5 years within which Ofgem can impose financial penalties for breaches of licence conditions.
Put UK at the forefront of developing CCS technology
– The new CCS incentive will support the construction of up to four commercial-scale CCS demonstration projects in the UK.
– The CCS incentive could also provide funding for the retrofit of demonstration projects to their full capacity, should it be required in future.
– It is hoped this Bill will strengthen the UK's leadership position in the development of clean coal technologies that could bring between £2-4bn a year into the UK economy by 2030, and support between 30,000-60,000 in jobs such as engineering, manufacturing and procurement.