Lga Response To Hes

The government today published three consultations: 1. Changes to the Carbon Emissions Reduction Target (CERT) 2. The new Community Energy Saving Programme (CESP) 3. The Heat and Energy saving strategy We would encourage member councils to respond to the consultations. Further information and the consultations are available at www.http://www.decc.gov.uk/hes

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On the day briefing – Heat & Energy Saving Strategy 12 February 2009

LGA key messages Energy suppliers should pay a £500 million annual charge to help fund a comprehensive home insulation programme that would lift half a million people out of fuel poverty. This would match the contribution householders already pay for the three year CERT through their energy bills. LGA research last September showed that the energy supplier’s dividend payments in 2007 were £1.65 billion (an increase of £275 million from 2006). If suppliers provided an additional £500 million each year to CERT, from their own profits, all remaining lofts and cavity walls could be insulated. • •

Councils should lead such a national programme, delivering measures streetby-street across their communities. By investing more in home insulation, ten million households would each save £280 a year on their energy bills, 500,000 people would be lifted out of fuel poverty and up to 20,000 new ‘green’ jobs would be created in areas such as renewable energy and provision of insulation.

briefing

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1. Changes to the Carbon Emissions Reduction Target (CERT)

Changes have further been proposed to incentivise topping up loft insulation, to allow suppliers to claim energy savings for conducting home energy audits and for consumption display devices. In September the Prime Minister also committed to insulating six million homes by 2011. However, the LGA predicts that CERT will only insulate four million homes. LGA key messages • The LGA welcomes the increased target. We want to see all of the additional £510 million spent on insulation, which could deliver an additional one million insulation measures. • CERT should be changed to focus on delivering insulation measures. The proposed inclusion of audits and display devices would make it easier (and cheaper) for suppliers to meet their targets. The long term energy savings from these measures have yet to be proven. Page 1 of 2 For further information please contact Kirsty Ivanoski in LGA public affairs [email protected] 020 7663 3120

Local Government House, Smith Square, London SW1P 3HZ DX 119450 Clerkenwell 3 Email [email protected] Tel 020 7664 3000 Fax 020 7664 3030 Information centre 020 7664 3131 www.lga.gov.uk

In September the Prime Minister announced that the CERT target on energy suppliers would be increased by 20% - an extra £510 million. The announced consultation is to enable the necessary change to the secondary legislation.

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In September the Prime Minister repeated that the additional £510 million should not be passed on to consumers, however there is no mechanism to ensure this and suppliers could pass on the costs to householders.

2. The new Community Energy Saving Programme (CESP) The CESP plans to require energy suppliers and – for the first time – generators to deliver insulation measures in community schemes and working with community partners. It will include more expensive and disruptive measures such as solid wall insulation and aims to provide whole-house solutions to people in deprived areas. The consultation proposes around three thousand eligible areas leading and aims for around one hundred schemes helping around one hundred thousand households. LGA key messages • This community-focused proposal is a step in the right direction but it is very small scale compared to CERT, and therefore is unlikely to provide capacity building to help set up new community schemes. • Energy companies must be required to work with the local council who can help them identify suitable areas with harder to treat properties. Councils are uniquely placed to lead and coordinate community based schemes and in particular can help the generators and new entrants to this field. • We are concerned that, similar to the increase in CERT target, there is no way to ensure the £360 million predicted spend for CESP is not passed on to consumers.

3. The Heat and Energy saving strategy to 2030 The consultation to establish a heat and energy saving strategy takes a longer view for tackling the housing stock. It suggests ways for existing homes to receive insulation, renewable heat and/or microgeneration. It aims to address the building fabric, behaviour change and energy using goods in the home. LGA key messages • A Heat and Energy saving strategy must provide the opportunity to address all homes including those which are hard to treat homes by installing solid wall insulation, renewables and renewable heat. • Councils should be at the heart of delivering this scheme. As those with local knowledge they are best placed to identify and deliver appropriate solutions to help people cut fuel bills and save carbon, and can provide the necessary advice and support to residents.

Page 2 of 2 For further information please contact Kirsty Ivanoski in LGA public affairs [email protected] 020 7663 3120