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What the renewable energy strategy and low carbon transition plan mean for your home

Posted by Cathy Debenham on 20 July 2009 at 3:01 pm

Households are expected to make cuts in their carbon emissions of 29% by 2020 according to the Government's Low Carbon Transition Plan, announced by Ed Miliband last week (houses currently emit more than a third of the UK's carbon).

This will be done through a combination of cutting the amount of energy used in homes and by incentivising homeowners to generate their own heat and electricity.

The good news for people keen to improve their homes is the plan for a "pay as you save" scheme (also known as a green mortgage). You will be able to borrow up to £10,000 to make your home more energy efficient, whether it be through insulation, a low energy boiler, renewable energy or other means.

The loan is repaid over a 25 year period from the savings in energy use that result. It is attached to the property, rather than the owner, so it doesn't matter if you sell your home before it's paid off. The bad news about this scheme is that so far it is only a pilot. It may be some time before most of us can benefit from it.

On renewable energy, the government is planning on just 2% of electricity coming from domestic microgeneration - an amount described as "lacking in ambition" by the Renewable Energy Association, which says the potential is much higher.

The much longed for feed-in tariffs were also announced. Called "clean energy cashback", the scheme will reward people who generate electricity with wind turbines and solar photovoltaic panels up to 5MW in size. The rate is being consulted on now, prior to its introduction in April next year. While most commentators have welcomed the commitment to the tariff, there is concern that it will not be set at a high enough level to encourage much take up or to build a UK industry. Low carbon commentator Chris Goodall does the sums on his blog, and concludes that they are "probably enough to get the microgeneration industry started".

The uncertainty of what will happen in the interim before the clean energy cashback is introduced has been removed, with the announcement that anyone installing solar panels or wind turbines before April 2010 will be eligible to receive it. The same applies for the renewable heat incentive due in April 2011. If you install renewable energy before they come in, there are still grants available from the low carbon buildings programme, as long as you use an MCS accredited installer (check under the nitty gritty tab on their YouGen profile, or on the MCS website).

On the energy efficiency front, Miliband announced plans to install smart meters in every home in the UK by 2020. Energy suppliers, who are already obliged to help householders to save energy and reduce their emissions through the Carbon Emissions Reduction Target (CERT), will have to do more. CERT has been extended to the end of 2012, and is expected to help an extra 1.5 million households reduce their energy use (on top of the 6 million already helped). Ring your local Energy Saving Trust advice centre to find out what help is available in your area on 0800 512 012.

Of course, all these changes are not without cost. The government estimates that the average household energy bill will rise by 8% over the next 11 years. While this might sound a lot, George Monbiot argues that it's nothing to what supply and demand and peak oil have done recently, and will do in the future, to prices if we don't move away from fossil fuels.

This road map is a step in the right direction. However, the day before it was announced I went to a conference run by the Ecos Trust. I was fired up with enthusiasm by some of the ambitious ideas outlined there (of which more in future blogs), and so rather disappointed that the plans weren't a bit bolder.

Photo by zedzap


If you have a question about anything in the above blog, please ask it in the comments section below.

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2 comments - read them below or add one

John Smith

John SmithComment left on: 29 July 2009 at 10:24 am

I receive 30p a unit for my exported solar, pv, generated electricity. Whatever electricity I use when the pv panel is generating is then costing me 30p a unit. This is an excellent reason to minimise use when the sun shines. Having minimised use then, it is not so difficult to minimise use at other times.

If the normal domestic background requirement is about 500W for 'fridges, clocks, telephones, alarms and the like then a small micro generator of say 800Wp will never be cost effective under this payment scheme. If the payment was for generated electricity then the picture changes entirely and maybe not for the better.

The good news is that so much can be saved just by careful thought.

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Cathy Debenham

Cathy DebenhamComment left on: 24 July 2009 at 10:25 am

Very interesting analysis of whether the touted Pay as You Save scheme will work in practice by Casey Cole at Carbon Commentary. He reckons that it will need significant investment from government or others. Maybe there are lessons to learn from the Kirklees RE-charge scheme, where the council is putting £3m of capital funding into the scheme.

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