Energy Saving Trust: our view to 2030 for England

Introduction

Over the past decade, the UK has been successfully transforming its power sector through a mix of policy and market-based measures. Now, the priority has to be transforming patterns of demand.

Our vision for Net Zero protects future generations from fuel poverty by starting with a very efficient housing stock then proceeds to reduce demand further via a high degree of local renewable energy generation and storage at both household and community level.

This transformation requires a clear roadmap for raising energy standards in our buildings, underpinned by regulation and financial support. And building owners and community organisations will only act if they know what to do.

Everyone should have access to impartial, expert advice on what they can do to save energy and cut carbon. We need a support network of advice centres across the country to provide consistent and coordinated advice and support.

We have eight key asks summarised below – you can read our full view to 2030 for England here.

Our priorities for homes

1. For homes to be retrofitted to at least Energy Performance Certificate (EPC) standard ‘C’ by 2030

Currently, 70% of English homes don’t meet a reasonable modern standard of energy efficiency, defined as Energy Performance Certificate (EPC) ‘C’. Bringing homes to this standard would set the UK on track for the most cost effective means of delivering net zero (meeting the Committee’s on Climate Change’s 5^th carbon budget scenario), avoiding the need for power stations the size of Hinkley Point C and largely eliminating fuel poverty.

2. A roadmap, underpinned by regulation and incentives, will build a market for retrofit

Voluntary action alone will not deliver the scale of delivery required (1.6m homes/ year). We need a clear long-term trajectory of the minimum energy efficiency standards required for sale and rental to give homeowners the confidence to invest in improvements.

3. Democratise retrofit: Provide access to low cost finance so homeowners can act

While ‘C’ is an appropriate regulatory minimum, many homes can reach a higher standard, particularly by fitting renewable energy systems. Providing access to low-cost finance will grow the market and boost innovation at a lower cost to taxpayers[1]. The social housing sector could play a pivotal role here if supported to do so by new powers and flexibilities.

4. Deeper retrofit can be cost effective if the wider public benefits are included

Getting to ‘C’ would:

• avoid costly reinforcements to the electricity grid
• deliver savings to the NHS (up to £2.0 billion each year)[2]
• cut gas imports (by 26%[3]) and
• reduce the overall cost of decarbonising heating (£6.2 billion per year)[4]
• create employment (100,000 FTE jobs to 2030[5]) and
• benefit the wider economy (0.6% GDP increase by 2030[6]).

While retrofit will require investment from building owners and government (at least £1.5 billion per year of additional public investment) tax revenue alone would increase £51.1 billion by 2030[7]. Assessment of what level of retrofit is cost effective must look beyond immediate bill savings to include these wider benefits.

5. Heat solutions must consider the long-term impact on consumer bills

Decarbonised heating options are likely to involve higher costs than current natural gas heating. To protect consumers, credible heat solutions must start with a high level of retrofit and should seek to minimise future consumer bills as well as system costs.

Our priorities for communities

1. A network of advice centres would empower homeowners and communities to act

Many people want to play an active part in the low carbon transition rather than have change ‘be done to them’. Easy access to expert, impartial and tailored advice, along with improved consumer protection is necessary if we want people and communities to invest their own money and make the right choices.

2. Ensure new routes to market for community energy

Community energy has the potential to play a key role in encouraging the uptake of new technologies and business models and supporting the shift to a more distributed, decentralised and digitised energy system. But recent changes to taxes and regulations have not helped the community energy sector.

3. Flexibility first: allow local generation and demand reduction to compete with generation

Demand-side measures such as demand-side response (DSR) – where communities manage how their local energy system draws and shares energy from the national grid – could play a valuable role in balancing the electricity grid and avoiding costly reinforcements. We would like to see the regulatory regime amended to oblige network companies to create a level playing field for demand-side measures and to reward innovation on this.

Footnotes

More on this…

• read our full view to 2030 for England report
• learn more about the programmes we deliver in the UK
• find out more about our policy work