UK Energy Efficiency Trends – October 2015

Energy Efficiency Trends is a quarterly report focused on the UK market, providing insight into non-residential energy efficiency.

In this edition (Vol. 12) which reflects industry views for the second quarter of 2015, supplier confidence in the government’s management of energy efficiency hit an all-time low. With the dust barely settled on the UK general election, Amber Rudd, the incoming Energy and Climate Change Minister announced a major change to the feed-in tariff for renewable technologies. As you will no doubt have seen, this move was (and still is) the source of much consternation within the sector, with many column inches lamenting the major job losses as a result.

It may be a harsh reality, but from a hard-nosed energy efficiency perspective this change is not bad news.  The financial support that has helped to drive renewables investments has, in part at least, meant that energy efficiency has been the poorer, less appealing relation to a confident renewables sector bolstered by generous financial support.  Conversely, energy efficiency has largely had to stand on its own two feet, without the same level of financial support. Whatever the rights and wrongs of this policy shift, for the energy efficiency sector, it indicates a move towards a new and level playing field in attracting ‘green’ investment pounds.

If that wasn’t enough, in the last month, HM Treasury also put out a consultation on changing energy efficiency taxation, incentives and reporting (see https://www.gov.uk/government/consultations/consultation-reforming-the-business-energy-efficiency-tax-landscape).

One would certainly expect the outcome of any Treasury-led policy change to be an increase in the tax take and, as a result, greater commercial interest in saving increasingly expensive energy. This is consistent with the turnaround in supplier confidence with respect to the government’s management of energy efficiency policy anticipated for Q3 2015.

A final point of note is the upcoming COP21 negotiations in Paris where expectations for reaching a binding agreement have grown in recent months. If this does come to pass, and if the UK Government does not intend to back renewable generation as a means of achieving any agreement, political momentum could well be swinging in favour of energy efficiency.

For more information, please visit the Trends portal on the EEVS website: http://www.eevs.co.uk/trends.html

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