Individual or collective route to net zero

19th Jul 2021

 

In the heat of the battle between hydrogen and electricity, (we’ll need shed loads of both actually), it is all too easy to ignore the real challenge, namely delivery. Writing a policy is simple; reaching agreement with your university Twitter chums, a piece of cake – actually doing stuff is hard. Too much time is spent thinking about “what” to do, rather than “how” to do it.

So let’s open up another debating point. Is the delivery of net zero going to be done through individual actions or by collective decisions? Consumer-led or systems-led? National Grid’s Future Energy Scenarios lay out these two options in their four scenarios, published last week. And if I were mulling over big government decisions, such as the heat and buildings strategy, I’d take time to read them and think through the implications.

But to help us reach agreement, let’s look at a few key facts on how consumers engage with energy. Two of the most quoted means of saving money from household energy bills are switching supplier and installing loft insulation. For the former, numerous online tools are there to make it an easy task. For the latter, there are a number of ways to get the insulation free or at low cost for low-income households.

According to BEIS, last year switching rates fell, and for gas only 18.3 per cent of households switched supplier. So on average, despite evidence suggesting money can be saved, we will switch every five years. According to the English Housing Survey, over 5 million homes have less than 100mm of loft insulation; the vast majority of these are owner-occupiers, again despite estimate bill savings of £200 a year achieved through this simple measure.

What does this suggest for our delivery method?

I would argue that system transformation is the key. Consumers won’t always act as you think they will. Carrots, despite being good for you, don’t always appeal. The stick is politically unacceptable. So engage the consumer in the discussion; get their support but deliver through system transformation and not 27 million individual decisions.

 Best wishes

Mike Foster, CEO