Dreams and reality, a follow up

13th Nov 2023

 

In my blog last week, I said my three priorities for UK energy policy would be energy efficiency, energy efficiency, and energy efficiency.

I want to follow up that call using some thoughts I developed for a presentation to the Future of Utilities Summit last week.

I framed my contribution along the lines of the “Dreams versus Reality” sketch from Father Ted, where a hapless character got confused between the two. I asked my audience to consider policy in the world we actually live in, not the one of our dreams. That’s why energy efficiency scores so highly in my eyes; it meets our social policy aims against the reality consumers find themselves in. Let me explain.

In a debate on heat decarbonisation, often wrongly pitched as “heat pumps v hydrogen”, the capital outlay required to reduce the carbon footprint is a major barrier to fitting a heat pump. Given the situation consumers face, is it any wonder this is a hard sell?

The median average household savings in the UK is just over two thousand pounds, that’s right, half of UK households have less. In fact, a third (34 %) have zero savings. Now that’s a fairly sobering fact and not an ideal backdrop to sell a net zero policy requiring significant outlay.

So why not borrow to invest? Well as anyone with a mortgage deal coming up for renewal will confirm, interest rates are at a 15-year high and eye watering compared to where they have been. If we as a country were going to borrow to invest, the time to do so was 15 years ago, not today.

And let’s not forget the elephant in the room. There is a general election looming. The Chancellor is laser-focussed on the short term. Ideally, he wants sweeteners for voters, nothing else. So how do we progress towards net zero, help consumers by cutting bills and reduce our energy requirements to protect ourselves amidst unstable geo-political crisis, well energy efficiency of course.