Memorandum submitted by the Association for the Conservation of Energy (NPS 78)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 the opportunity to submit written evidence to this inquiry.
1. ACE is concerned that the National Policy Statements on the whole, and the Draft Overarching National Policy Statement for Energy (EN-1) in particular, do not sufficiently investigate the potential for reducing UK electricity demand. The Department for Energy and Climate Change (DECC) seems to view energy supply policy as entirely separate from energy demand policy. Any consideration of future supply requirements has to be founded upon a detailed assessment of energy demand.
2. ACE sees no evidence that such an assessment has taken place. The statements on the potential for reducing energy demand simply claim that any efficiency savings will be displaced by increased demand from electric heating (presumably heat pumps), electric vehicles, and an increase in the number of households. This is not an acceptably rigorous assessment.
3. It is vital that electricity demand reduction be considered fully because the successful implementation of policies in this area may negate the need for additional generating capacity. Government is relying upon technologies that are in most cases highly controversial, often unproven, and potentially very costly to meet an 'electricity need' that could be reduced through the implementation of effective demand reduction policies. How do the costs and benefits of such investment in generation capacity compare to the costs and benefits of demand reduction? It appears that Government has ignored the question.
4. In 1981 The House of Commons select Committee on Energy (Sixth Report to Session 1980-1) posited this specific criticism of Government policy: Government "still has no idea whether investing £1,300m in a single nuclear plant is as cost-effective as spending a similar sum to promote energy conservation". This report was issued at a time when Government had just announced its intention to promote a new generation of nuclear power stations (of which just one was finally built). It is plainly ludicrous that a generation later Government is still failing to address this most basic question.
5. Government frequently espouses the virtues of energy efficiency: it is the cheapest way of reducing carbon emissions, it improves energy security, it increases the productivity of our businesses and industry, saves money for householders and generates economic wealth. Yet, when designing national energy policy, Government would rather opt for controversial, unproven and/or costly technologies such as nuclear power or carbon capture and storage.
6. ACE believes that it is possible to radically reduce our electricity consumption, whilst allowing for the increasing penetration of heat pumps and electric vehicles (which would largely consume electricity during off-peak hours). One scenario sees electricity demand falling to 282 Twh in the long-term[1]. Potential demand reduction policies could include: · Fully insulating homes that use traditional electric heating systems, and replacing these systems with heat pumps that are between two and four times more efficient · The rigorous implementation of minimum efficiency standards on all electrical products · Consideration of 'scrappage schemes' to accelerate the replacement of inefficient products
6. In conclusion, energy efficiency must be given primacy in energy policy in order to reduce costs to businesses and householders, and to maximise security of supply. As such, Government must undertake and publish a thorough review of the potential for reducing the UK's consumption of electricity, and set these options alongside those for increasing generating capacity to present the full range of alternatives for meeting the UK's electricity needs.
January 2010 [1] A Renewable Electricity System for the UK: A Response to the 2006 Energy Review. (2006). UCL http://www.cbes.ucl.ac.uk/projects/energyreview/Bartlett%20Response%20to%20Energy%20Review%20-%20electricity.pdf |