The Government has delayed the start of a new four year programme of the Government’s already minimal home energy conservation programme. This means that several tens of thousands of poor households will miss out on vital cost-saving measures. The Energy Company Obligation (ECO), whose funding is small compared to the tax concessions handed to oil and gas companies, is a pale reflection of the scheme which operated under the last Labour Government. Insulation rates funded by ECO have fallen by over 90 per cent since Labour’s scheme ended in 2012 (see page 112 of last year’s report by the Committee on Climate Change).
The delay appears to have been caused by a failure to prepare the necessary legislation – but this failure speaks volumes about the Government’s priorities when it comes to energy conservation.
Rates of loft and cavity wall insulation have plunged by over 90 per cent since 2012 – despite the fact that the majority of buildings are under-insulated even with these most basic measures. Other types of energy conservation support are practically non-existent. Since 2012 the Conservative-led governments have organised feeble efforts to mount failed schemes to fund energy conservation, whilst starving the programme that has worked of funds.
The next phase of the Energy Company Obligation, funded by a levy on electricity consumers’ bills, was supposed to start in April However, according to the Energy and Climate Information Unit it may not now begin until the Autmun.
Jess Ralston, SeniorAnalystat the Energy and Climate Intelligence Unit, said: “With this further delay to the highly successful ECO insulation scheme and Treasury having blocked additional help for homes leaking heat, voters struggling to pay the bills, many of them in swing seats, will be wondering when help is coming. …..The recent energy security strategy with its focus on North Sea drilling will not bring down bills now, but there are plenty of roofs that still need insulating.”
The Government claims it does not have money to spend on energy conservation yet the ECO scheme could be boosted by large amounts simply by not giving so much tax concessions to the oil companies. Doug Parr, Greenpeace Chief Scientist, commenting on the Chancellor’s recently announced tax breaks for investment in oil and gas supply, said: ‘The tax break is worth between £2.7bn and £5.7bn to the oil companies, but a £3bn efficiency programme on homes would save bill payers over £700mn every year, for good’. This tax concession is only the latest in the multi-billion worth tax concessions earned by the oil and gas companies. Since 2015 they have not had to pay any taxes at all on their Uk activities.
The currently planned ECO programme is for £1 billion a year over four years. The range and type of measures is limited, and it is only large enough to serve some of the needs of a minority of the fuel poor which are eligible. Only households on low incomes can qualify for support, and the funding is predicated on the fact that the majority of this group will not be served in the scheme. There are strict limitations under the new ECO programme on what can be financed. Only the worst insulated houses can be helped, and then only if the work is going to give very large specified improvements. Buildings that already have an Energy Performance Certificate (EPC) rating of C will not be funded.
By David Toke
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