Examination of Witnesses (Questions 900-906)
MR DAVID
VINCENT, MR
JAMES WILDE,
MR DAVID
TIMMS AND
MR ED
MATTHEW
9 MAY 2007
Q900 Chairman: One of the things
that comes out of this line of questioning is coming back to the
central point of this bit of the inquiry about behavioural change,
in terms also of the point, I think, that witnesses were making,
which is almost going for the low-hanging fruit. In other words,
where you are going to get the biggest hit for whatever amount
of resource you use. What should be the pecking order? We have
been talking about resistance, because not every home is insulated
perhaps as well as it could be, and yet you have advocated as
your number one priority good energy efficiency. What are the
barriers to progress and what is the best device to remove the
barrier?
Mr Wilde: In the business sector,
I spoke earlier about the sets of barriers and drivers and how
you need an integrated set of policy measures, including building
regulations, which force change and product standards, which take
poor performing bits of equipment out of the market place. The
Energy Performance Commitment that the Government are looking
at is a good way of incentivising change as well for the business
sector. I think there is a series of policy measures that are
required beyond just taxation to really look to overcome the barriers
and drivers. One piece of work we are doing that relates to the
consumer is really looking at the influence businesses can have.
We did an exercise to map UK emissions by consumption in service,
and you find that the UK is a net importer of emissions; and so
now we are working with companies, not just to look at their own
direct emissions, but to look at the carbon embodied in the products
that they produce and, therefore, supply chain emissions. We find
that two-thirds of consumers want to know what the carbon footprint
of the products is that they are buying and two-thirds would also
want to buy lower carbon products. We have had a lot of businesses
coming to us to say, "We want to look at our supply chain
emissions, look for opportunities to reduce them and also inform
customers as to what those emissions are."
Q901 Chairman: Mr Timms, your body
language and demeanour suggested more enthusiasm for carrots than
it did for sticks in terms of moving barriers and getting agendas
moving forward. How do we hit the low-hanging fruit then?
Mr Timms: I am not sure if my
body was misleading you. I would not say I am more of a carrot
man than a stick man. The low-hanging fruit is definitely home
energy efficiency, and everybody has recognised this. It is the
lowest cost carbon emission reductions that we are really going
to get anywhere, apart from voluntary behaviour changes. However,
I think there is a danger with a strategy that says: what we do
is look at the cost-effectiveness as measures and we do all of
the most cost-effective, then we move on as a society to looking
at the next most cost-effective and then we move down, because
what you will do is you will find yourself getting to 2020 and
there are still maybe 500,000 homes that are holding out against
a particular energy efficiency measure and you have not got round
to developing a renewable energy sector and you do not have homes
starting to put in micro-renewables. So, I think there is a risk
of having a strategy which just says you move from A to B to C
to D and that delivers you 80% cuts in your carbon emissions by
2030. I do not think it will work like that. What that means is
that while you do have to have massive investment for a range
of mechanisms, and it is not just the incentives for the able-to-pay,
it will be the state, in various forms, actually doing this for
those that are unable to pay as well, but you do have to start
to have mechanisms to roll out, using taxpayers' money, micro-renewables.
We see this as being an industry which can play a significant
role in the UK. True, some of the sectors and technologies have
been monopolised by different countries, but there are others
where the UK could have a leading role.
Q902 Lynne Jones: Such as?
Mr Timms: Tidal, for a start.
Q903 Lynne Jones: That is not microgeneration.
Mr Timms: No, that is true; you
are right there. Certain areas of wind as well, but I think as
regards photovoltaics, British industry is really struggling with
the Low Carbon Buildings Programme.
Q904 Lynne Jones: Are we giving too
much emphasis to domestic installations of microgeneration and
not enough on community generation, which would be much more effective?
What we saw in Germany is people are willing to bung a bit of
money to have the school or the local community building full
of photovoltaics, or a community, a village wind-turbine rather
than people having little things all over the place. How could
we stimulate investment? The Chancellor has asked Ofgem to look
at this and to look at ROCs for individuals, but if people invest
in microgeneration, they could have it tax exempt so that, instead
of putting money into ISAs, people will be putting it into microgeneration.
Mr Timms: I know the Committee
has been over to Germany to have a look there, and we have certainly
got a colleague in Germany who bought a home which had solar panels
on it and sends us emails every now and again saying, "I
woke up this morning and my house is making me money", because
he is getting 35 pence a kilowatt hour for it, and people here
are getting between four and 10 pence a kilowatt hour. We certainly
think the Government needs to take the measures necessary. Lynne
Jones is absolutely right that we have to do something other than
just look at people's individual homes and off-shore wind arrays
like the London Array—there are levels in between—and
things liked the Merton Rule on new developments will start to
address that. I have to say, it is not my area of expertise how
you are going to roll it out at different levels, but we certainly
agree with you that there is a need for it and we can send you
some evidence on how we think that might happen, if that might
be useful.
Q905 Chairman: I do not want to this
to get to be a re-run of evidence that we have already taken on
a multiplicity of other things. I think the message I have got
from you all is that there is no one, single policy instrument
in any of the things that we have talked about; it is a question
of blending all of the policy instruments, some carrots, a bit
of stick, some technology, some behavioural change, some corporate
social responsibility—all of those mixed together as appropriate
to achieve the task—rather than simply saying: silver bullet,
green taxation, everything fixed. I think that is the main message
that you have put across and, as you are all nodding, I am going
to thank you very much indeed for coming before the Committee
this afternoon and thank you for your written submissions. It
is all down on the record, but, obviously, if there are further
thoughts you have that you wanted to give to us, we are at the
stage where this is the last piece of the jigsaw puzzle to go
into the report before we draw our final conclusions and produce
a draft, so time is short, but, nonetheless, thank you very much
indeed for your contribution. We really appreciate it.
Mr Vincent: May I come back on
that last set of points.
Q906 Chairman: Is it a postscript
comment?
Mr Vincent: It is a very brief
one. It is to suggest there should be consistency and complementarity
and longevity of that package of measures. Otherwise there will
not be the confidence, certainly in the business community, to
make that transition.
Chairman: If I could respond to that,
we have taken evidence on, if you like, the lessons learnt from
EEC1, where we are with EEC2 and what is EEC3 going to look like,
to coin a phrase about the Energy Efficiency Commitment, and,
you are quite right, this question of investment and resources,
the training and the skills are points that certainly the Committee
have been made aware of. Thank you for emphasising it again.
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