Our national energy policy debate has finally shifted its focus to two areas where we need to do more to wrest control of our energy bills back from Putin for good: energy efficiency and onshore wind power. With Treasury resources rightly prioritised for insulating many more fuel-poor homes, the Government should look at other ways to help families upgrade their homes and conserve energy. But it must also end the ban on new wind farm projects to give communities a genuine choice and access to cheap power locally.
In a welcome move, the Business Secretary has launched a campaign to advise families on how to waste less energy and announced a taxpayer-funded, industry-led insulation programme for the fuel poor. Both begin to fill the big hole in the Government’s Energy Security Strategy, which focuses on securing our energy supply but not reducing consumption and waste. Insulation is the most effective way to directly shield British households from the volatility of international gas markets.
Despite the new investment, ministers have already been advised that the new ECO+ programme won’t be enough to meet the Chancellor’s target of a 15% reduction in energy consumption by 2030. There are 19 million energy-inefficient homes that need upgrading, at a cost estimated by the Environmental Audit Committee of between £35 and £65bn (at an average cost of between £1800 and £3400 per property). Clearly, the Government cannot afford to foot all of this bill, nor should it. Whitehall has a bad track record when it comes to delivering insulation programmes.
The new energy efficiency taskforce, announced by the Chancellor, should focus on developing novel financing mechanisms to help people pay for upgrades. For example, an employee benefit scheme could help people spread payments for upgrades, tax-free, across their monthly pay packets. Low-interest loans, underwritten by the new UK Infrastructure Bank, could link repayments to the property itself rather than the occupier. Allowing people to reclaim Stamp Duty to improve a home’s efficiency would help buyers, incentivise sellers, and encourage banks to develop green mortgage products.
There are lots of ideas out there and numerous success stories from other countries to follow. But while insulation and efficiency reduce the impact of market volatility on people’s bills, reducing our dependence on gas for heat and power through electrification will solve the problem for good. Wind and solar were the cheapest energy sources even before Russia invaded Ukraine. Since 2015, the ban on onshore wind has left us less secure than we otherwise would have been, while analysis from the Energy and Climate Intelligence Unit found that we will pay £800m more than we would have had we allowed onshore wind turbines to be built.
Onshore wind was effectively banned because communities felt they didn’t have an adequate say over projects in their area. But with sky-high energy bills, growing concerns about climate change, and energy firms offering communities perks for hosting wind farms, onshore wind is more popular than ever.
There is now broad support, across the back benches and reportedly within Cabinet, for Simon Clarke’s amendment to the Levelling Up and Regeneration Bill, which would return decision-making to local communities and allow them direct access to cheap wind power. Octopus Energy alone has identified 2.3 gigawatts, enough to power nearly two million homes, that has community backing already. Despite some rumblings from a vocal but shrinking minority, local wind farms are now backed by three-quarters of the 2019 Conservative voter coalition; it does not split the vote like fracking.
The community consent mechanism is important. It allows communities to have the final say over whether they would prefer to have companies compete to give them the best deal and provide access for constituents to cheap power, or prefer to save their eyes from a few turbines. Labour prefers a different approach: compelling local authorities to find suitable sites for wind turbines paired with a top-down mandated target. This is an inferior solution. Finding suitable sites is best left to energy companies, with their resources and expertise, rather than resource-starved councils. The Government should accept the amendment and take the chance to lock in a smart community consent for good.
The Conservatives have made huge strides in scaling up renewables, especially offshore wind, that have come to the rescue during this crisis, but the missteps on insulation and onshore wind have made us more exposed than we would have been. Both have the strongest public backing when it comes to combating Putin’s weaponisation of fossil fuels. Helping more people to upgrade their homes and allowing them the option to build wind farms are two no-brainers.
First published by CapX. Jack Richardson is Senior Climate Programme Manager at the Conservative Environment Network.