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What does ‘energy efficiency infrastructure’ mean?

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At Labour’s party conference in Manchester last week, the Labour Shadow Energy Secretary’s announced it would, if elected, refocus the Energy Company Obligation (ECO), ensuring at least 200,000 homes a year to benefit from whole house retrofits over the next Parliament. 

And, in support of empowering local level activity in energy, she promised to “put local authorities and communities in the driving seat” in delivering this ambition of the ECO scheme. Many welcomed this announcement as local authorities are uniquely well placed to draw together their understanding of their local communities, such as the location of the most vulnerable, planning developments and local economic strategies. 

Flint also said a Labour government would ‘make saving energy a national infrastructure priority’. This followed from an almost identical promise from the Liberal Democrats a few weeks previously. This is a key change, considering local action as part of the infrastructure debate, rather than simply large plant and power lines. Well designed, such a policy could allow energy efficiency investments to compete head-to-head with large-scale energy generation for infrastructure funding. 

The risk with the policy is too narrow a definition. Local energy infrastructure goes far beyond insulating homes, which is where ECO is focussed. We need to look both at homes and industry but at end users as part of the whole energy system, not individual islands. If we miss the system-wide perspective there are major energy-saving opportunities that may get overlooked. 

Local authorities are today investing in more efficient local generation, installing innovative heating solutions and balancing local demand to make sure we get the most out of the energy we have. By focussing locally and on the energy needs of their residents, local authorities are able to coordinate a full range of local energy efficiency measures. 

Worryingly, Labour said they will fund interest-free loans for homeowners by using £300m already earmarked for other energy efficiency programmes between 2015 and 2017. Cutting other innovative schemes to fund domestic efficiency investments is a case of robbing Peter to pay Paul. 

Instead, we should be requiring energy generation projects to prove they provide equal or greater benefits to the economy than other energy investments– be it reducing demand, efficient local generation and heat supply, or helping users to manage their power demand actively. 

The three main political parties will need to ensure ‘energy efficiency infrastructure’ includes all of these different energy saving mechanisms if we are going to most cost-effectively reduce demand and the cost of energy bills, for homes and businesses alike.

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Guest Monday, 29 May 2017