Which? report says next government must do more on energy efficiency

A new Which? report has called for the next government to radically re-think its energy efficiency strategy to help millions of consumers ensure their homes are better insulated.

With energy bills consistently one of the top financial worries for consumers, our new report, A Local Approach to Energy Efficiency, calls for a better approach to energy efficiency. Despite successive governments attempting to address this issue, the UK’s housing stock continues to be among Europe’s least energy efficient with millions of homes leaking cash every winter through poor insulation.

Up to 5.4 million homes still do not have their cavity walls filled, a measure which can save up to £140 per year off the average dual fuel bill, and up to 7.4 million still need their lofts fully lagged. It is also estimated that the NHS spends £1.36 billion each year treating illnesses caused and exacerbated by cold homes.

The report highlights action for the next Government including:

  • A switch to a long-term local approach: partly funded by a long-term levy on energy suppliers and paid into a central pot. Funds would be allocated by a central administrator to local authorities for them to lead the roll-out of energy saving measures from 2017. This could include partnerships, for example between councils and GPs or social landlords, to use local knowledge to maximise consumer take up.
  • An overhaul of the Green Deal: With just 399 plans taken out on average each month since it launched – around 9,600 in total – we want to see fundamental improvements and an immediate evaluation of the scheme.
  • A decade-long cross-government plan: We want to see clear insulation targets and delivery plans extending over the next ten years. Taking action on energy efficiency needs a joined up approach across government including Department of Energy & Climate Change (DECC), Department for Communities and Local Government (DCLG), HM Treasury, Department of Health, Department for Business, Innovation & Skills (BIS) and devolved administrations, because of the many benefits for health, jobs and the economy.
  • Better cost control and value for money: We want to see greater scrutiny and oversight of the money spent from consumers’ bills on energy efficiency. We want to change the supplier obligation to a fixed levy on bills, overseen by Government, which would ensure more transparency and certainty about the costs consumers pay for green measures.

Which? executive director, Richard Lloyd said:

“With millions of homes still not insulated, energy efficiency is a collective failure of successive governments. The next Government must grab this issue by the scruff of the neck and commit to an aggressive energy efficiency strategy as soon as it takes power.  We want to see radical improvements to the roll out, funding and take-up of energy efficiency measures so people can enjoy warmer homes, lower bills and better health.”

Energy efficiency is part of a wider issue with this sector, and we believe the next Government must prioritise making sure the energy market is stronger, more competitive and works better for consumers. We need to make it easier for consumers to choose the best energy deal, which is why we published research highlighting how simple pricing can help consumers pick the best tariff. Also as district heating becomes more widespread, we have published a new report raising questions for the next government on how to ensure these schemes offer consumers a fair deal.

Which?’s Fix the Big Six campaign calls for radical reforms from the Government, regulators and energy companies to fix the broken energy market. The campaign calls for an overhaul of the Green Deal to make it a fairer deal for consumers – more than 60,000 people have supported the campaign and you can give your support at www.which.co.uk/fixthebigsix

Notes to editors

  1. A full copy of the report is available here.
  2. According to Age UK the NHS spends £1.36 billion each year treating illnesses caused and exacerbated by cold homes.
  3. According to Government figures from December 2014, up to 7.4 million UK homes still don’t have their lofts fully lagged, up to 5.4 million GB homes with cavity walls remain uninsulated and only 3% of homes with solid walls have been insulated.
  4. It is not practical to expect more public funding or levies on bills to fund energy efficiency measures, so existing resource must be delivered more cost effectively. Through local partnerships, for example between councils and GPs or social landlords, local knowledge can be maximised to successfully find and engage consumers, achieve higher take up and achieve economies of scales on a street-by-street basis. As currently happens in Scotland, this would require local authorities to develop and implement new energy efficiency strategies.
  5. The proposals set out in our report require a number of changes to be made in 2015/16 including legislation for the new levy that would come in after the Energy Companies Obligation (ECO) in April 2017; establishing a central administrator function and central support unit and allocation; and allocating seed funding to all English local authorities to prepare them for the new fund, to enable them to prepare the initial strategy and to collate housing stock data.
  6. A recent study by Verco has estimated that the economic benefits of a large-scale energy efficiency programme would be considerable: including £3.20 returned through increased GDP and £1.27 in tax revenues per £1 invested by government.
  7. The Which? Consumer Insight tracker reveals that over the last month:
  • Energy prices are the top consumer worry, with two thirds of people (66%) saying they are worried about energy prices.
  • Only one in four (24%) people currently trust gas and electricity companies to act in their best interests.

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