Yesterday, the Government published a consultation on the Heat and Energy Saving (HES) Strategy: a long-term plan dubbed the "Great British refurb" by the Energy and Climate Change Secretary, Ed Milliband. The consultation closes on 8 May 2008.

In the draft HES Strategy, the Government has concluded that existing buildings in the UK will need to reduce carbon emissions to almost zero in order for the UK to meet the target of an 80% cut in emissions by 2050. To meet this target, the Government is considering how to incentivise individuals and communities to take radical steps to save energy. In the Government's view, taking such steps will: (i) benefit households by reducing their energy costs; (ii) help address energy security and diversity of supply issues; and (iii) boost the economy by creating new business opportunities.

To view the article in full, please see below:


Full Article

Yesterday, the Government published a consultation on the Heat and Energy Saving (HES) Strategy: a long-term plan dubbed the "Great British refurb" by the Energy and Climate Change Secretary, Ed Milliband. The consultation closes on 8 May 2009.

In the draft HES Strategy, the Government has concluded that existing buildings in the UK will need to reduce carbon emissions to almost zero in order for the UK to meet the target of an 80% cut in emissions by 2050. To meet this target, the Government is considering how to incentivise individuals and communities to take radical steps to save energy. In the Government's view, taking such steps will: (i) benefit households by reducing their energy costs; (ii) help address energy security and diversity of supply issues; and (iii) boost the economy by creating new business opportunities.

Key proposals of the draft HES Strategy

Refurbishment and kitting out of existing building stock

The Government wants to deliver a "whole house" solution. It aims by 2020 for 7 million homes to have been refurbished and kitted out with energy efficiency and renewable heat and electricity measures. By 2030, the Government wants every house to have access to such measures. Key aspects of the Government's plan include:

  • Offering "whole house" energy assessments to households, followed by detailed, tailored advice on potential solutions.
  • Developing a training regime to expand the role of Domestic Energy Assessors (who currently provide Energy Performance Certificates), so that they are equipped to provide detailed energy efficiency advice to households. An accreditation scheme for installers of energy efficiency measures is also being considered.
  • Providing (potentially subsidised) financial support to encourage households to undertake energy efficiency works. The Government is considering a number of finance models, including:
  • linking repayment of finance to the property, rather than the resident, so that the initial costs can be spread over time and would transfer from one homeowner to the next; or
  • applying an energy service company (ESCo) model to the residential housing sector, where the service contract could potentially transfer from one homeowner to the next.

In structuring a financial model, the Government will need to address a number of commercial, competition, consumer protection and other regulatory issues. The final shape of the overall delivery model for the draft HES Strategy (see below) will influence which financial model is most appropriate.

  • Getting the Renewable Heat Incentive in place by April 2011. See Law-Now for details. The Government asks for views on whether: (i) banding should be structured by technology and/or by customer group; and (ii) the scheme could be structured to allow upfront payments to small-scale heat generators (such as households) to cover their initial capital cost of purchasing the relevant technology.

Delivery Model

The Government is reviewing the delivery model for its proposals beyond 2012. It is considering the pros and cons of extending the current energy supplier-led model or setting up a central co-ordinating body. While a decision has not been made, the Government considers that a new co-ordinated delivery model could roll out improvements house-by-house and street-by-street. The Community Energy Savings Programme (CESP) will be a pilot for a more co-ordinated approach. The Government also stresses the need to deliver through close partnerships with Local Authorities and acknowledges its responsibility to take the lead by ensuring that building stock in the Government and social sectors reflects best practice.

Further regulation

The Government has not ruled out further regulation of existing building stock and is also considering a new voluntary code of practice with the building trade on energy efficiency and low carbon energy.

District Heating

The Government is keen to encourage greater use of district heating and to this end will establish a Heat Markets Forum with representatives of Government, energy industry and consumers. This body will look at how to best supply district heating, build market confidence and protect consumers.

Combined Heat and Power (CHP)

The Government wishes to encourage combined heat and power. It seeks views on whether the range of existing or planned policy measures which affect carbon pricing provide sufficient support to encourage development of new CHP schemes, particularly CHP generated from renewable sources.

Related Consultations

The Government also published two other related consultation papers on:

  • the design of CESP which will run until the end of 2012 and will provide whole house improvements to around 900,000 homes in low-income areas backed by approximately £350 million in funding from energy companies; and
  • the changes to the existing Carbon Emission Reduction Target (CERT) scheme, including an extension of the scheme until the end of 2012 and a 20% increase in the overall carbon emission reduction target.

All three consultations can be viewed by clicking here.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 13/02/2009.