UK should put energy savers 'in competition' with energy generators

Instead of paying incentives only for new, clean energy like solar power, governments looking to promote sustainability should also reward energy efficiency.

In Britain, paying for greater efficiency would cost half as much as investing in new energy sources, according to a new report from the Green Alliance. That could reduce costs to citizens by £35 billion by 2025 by reducing the need to develop additional generation, whether from nuclear, wind or other sources.

The Green Alliance recommends that the government move in that direction by creating new “competition” between energy generators and energy savers.

“The electricity market is a one-way street: there are big incentives to produce more power, and very few to save energy,” said Dustin Benton, who authored the report. “This means we spend more on energy than we need to. Getting a low-cost, low-carbon transition means paying for energy saving, and creating new competition between power producers and energy savers.”

In his report, Benton finds that, while the British government is banking on a 16 percent decrease in electricity demand between now and 2025, its policies are unlikely to achieve that. As a result, the UK might have to meet additional demand by building six new nuclear power plants or installing 5,000 offshore wind turbines. Those options carry a price-tag of around £70 billion.

By contrast, doing more to boost energy efficiency could eliminate the need for at least half that new generation, cutting the potential cost to taxpayers by £35 billion.

The report notes that energy efficiency can have an even greater payoff in other countries. In the US, for example, energy-saving programs are about three-and-a-half times less expensive than building new power generation.

The Green Alliance recommends that the UK enact an electricity efficiency feed-in tariff similar to the ones it uses to promote the development of solar, wind and other renewables. It adds the government should begin trials of such a tariff now and “road test” its mechanisms with “low-cost, low-risk energy saving measures.”