Memorandum submitted by the Association for the Conservation of Energy (ACE) (GJS24)
Introduction to the views of ACEThe Association for the Conservation of Energy is a lobbying, campaigning and policy research organisation, and has worked in the field of energy efficiency since 1981. Our lobbying and campaigning work represents the interests of our membership: major manufacturers and distributors of energy saving equipment in the United Kingdom. Our policy research is funded independently, and is focused on three key themes: policies and programmes to encourage increased energy efficiency; the environmental, social and economic benefits of increased energy efficiency; and organisational roles in the process of implementing energy efficiency policy. We welcome this opportunity to respond to this consultation.
Summary
· Investing in energy efficiency has the potential to create hundreds of thousands of green jobs. · Current Government investment in energy efficiency and sustainable energy is too low and needs to be increased. · ACE urges Government to support the Fuel Poverty Bill which, if enacted, has the potential to create 37,000 direct jobs. This is before considering the many thousands of indirect jobs that would accrue. · Government must set energy efficiency and sustainable energy targets to provide industry with the certainty it needs to start investing - thus creating jobs. · Financial incentives for energy saving measures will provide a much-needed boost to the energy saving materials market.
1. Government has identified that energy efficiency is the cheapest, cleanest and safest way of meeting our energy needs.[1] A focus on energy efficiency will also help boost employment and has the potential to create hundreds of thousands of green jobs, across a range of different skills.
2. A recent report commissioned by Greenpeace has highlighted the benefits of an energy efficiency based fiscal stimulus and shows that a £5 billion investment in energy efficiency in the domestic sector alone over 10 years will deliver around 55,000 jobs directly and hundreds of thousands of jobs indirectly. [2] 3. It is not only environmental groups who are calling for a green stimulus. Sir Nicholas Stern, world renowned author of the Stern Review on the Economics of Climate Change, has called for a green stimulus[3] and the New Green Deal policy package, designed to maximise the energy efficiency of homes, power a renewables revolution and create thousands of green-collar jobs, and is supported by a growing number of UK experts in finance, energy and climate.[4] 4. Yet a recent report by the New Economics Foundation shows new and additional spending for the green stimulus part of the Pre-Budget Report is incredibly low - at just 0.6% of the UK's £20 billion recovery plan. This is just 0.0083% of UK GDP, an incredibly low amount when compared to the fact that nearly 20% of UK GDP has been made available to support the financial sector in recent months.[5] 5. The UK needs to shift away from our dependency on fossil fuels and Government needs to target much-needed funds towards energy efficiency and sustainable energy. Government has an opportunity to invest in low carbon and sustainable industries which will not only create green jobs but also help us to meet our newly announced 2020 interim carbon emissions target, putting the UK on a low carbon trajectory towards achieving our 2050 target. Setting the foundations for an early transition to a low-carbon economy will create new jobs as well as encourage new business and investment thus paving the way for a more stable, sustainable future. Fuel Poverty Bill6. The Association for the Conservation of Energy, as part of the End Fuel Poverty Coalition[6], is promoting the Fuel Poverty Bill which would require a national energy efficiency programme to raise the energy efficiency standards of homes in fuel poverty to those enjoyed by new homes. Our research shows that the proposed improvement programme will have major economic benefits, important at a time of economic recession, and would provide 35,700 'green' jobs[7]. This is an eight fold increase in direct jobs compared with current 'fuel poverty' programmes (Warm Front and the priority group element of CERT). 7. This is before considering the jobs created indirectly as householders spend some of the money they save on additional goods and services. The Impetus report for Greenpeace reviewed previous energy efficiency programmes and found that over twice as many jobs were created indirectly than were created directly - in some cases up to 7.5 times as many were created. We would therefore expect hundreds of thousands of indirect jobs to be created as a result of the adoption of the Fuel Poverty Bill. 8. Our research also shows that the additional benefits of this energy efficiency programme would lift over 80% of fuel poor households out of fuel poverty, reduce energy bills (with some of the financial savings being spent elsewhere in the economy), cut carbon emissions and have considerable economic benefits - putting around £6.6 billion back into the economy. This programme represents a very cost effective way of addressing the current recession and protecting the fuel pool from any price increase linked to climate change initiatives. 9. ACE therefore strongly recommends that Government support the Fuel Poverty Bill and ensure that it becomes law in this Parliamentary session. Sectoral Targets10. In order to protect existing jobs, create opportunities and encourage investment the UK needs a mixture of policies that will tackle the current global economic slowdown as well as help us to meet our targets to reduce carbon emissions and ensure that we achieve energy security. 11. To this end ACE is promoting the Climate Change (Sectoral Targets) Bill which requires the Secretary of State to set long term targets for energy efficiency in the domestic and non domestic sectors, for renewable energy, microgeneration and other low carbon sources of energy generation in order to satisfy all of the UK's energy needs, provide for security of supply and also help achieve carbon reduction targets. Setting targets for these sectors will give industry the certainty it needs to start investing and this in turn will create jobs and help to regenerate the economy. 12. ACE therefore urges Government to support this Bill and urges the early setting of energy efficiency and sustainable energy targets in all sectors. Financial Incentives13. One
of the major barriers to installing energy saving measures in homes is high
upfront costs. Setting up a comprehensive package of financial incentives to
encourage homeowners to install energy saving measures will create more demand
for energy saving materials and thus provide a much needed stimulus to the
energy saving materials market. This will expand the market and create direct
and indirect green jobs. [1] Energy White Paper, Our energy future - creating a low carbon economy, DTI, February 2003 [2] The case for including energy efficiency investment in the fiscal stimulus package, A report for Greenpeace by Impetus Consulting Ltd, 30 March 2009 [3] An outline of the case for a 'green' stimulus; Alex Bowen, Nicholas Stern, Dimitri Zenghelis, Policy Brief February 2009 [4] A New Green Deal , New Green Deal Group, New Economics Foundation, July 2008 [5] A. Simms, V. Johnson & S. Nissan, Green Stimulus or Simulus? New Economics Foundation, 2009 [6] The End Fuel Poverty Coalition consists of Age Concern and Help the Aged, Association for Charity Officers, the Association for the Conservation of Energy, Barnados, the Centre for Sustainable Energy, Child Poverty Action Group, Compass, Consumer Focus, Counsel and Care, Disability Alliance, Federation for Private Residents Associations, Friends of the Earth, GMB, Macmillan Cancer, National Childbirth Trust, National Pensioners Convention, National Federation of Women's Institutes, National Right to Fuel Campaign, Royal College of Nursing, the Sustainable Energy Partnership, Tenants and Residents Organisations of England, UNISON, WWF. [7] Raising the SAP - tackling fuel poverty by investing in energy efficiency, Report to Consumer Focus by the Association for the Conservation of Energy (ACE) and the Centre for Sustainable Energy (CSE), May 2009 |