Government commits £6bn for energy efficiency drive to ease record bills
The Government has will double the funding for a nationwide drive to boost the energy efficiency of people’s homes.
Chancellor Jeremy Hunt has pledged to spend a further £6bn from 2025 to insulate homes and upgrade boilers, as it targets a massive 15 per cent cut in energy demand this decade.
He said: “This must be a shared mission with families and businesses playing their part – but so will the government. Our commitment to the British people is, over time, to remove this single biggest driver of inflation and volatility facing British businesses and consumers.”
He argued that cutting demand could save £28bn the UK’s national energy bill at today’s prices, shaving £450 off the average household bill.
This is on top of £6.6bn the Government has allocated to boosting energy efficiency across UK households since the start of this Parliament in 2019.
The spending commitment was announced at the Autumn Statement alongside the ramp up of the windfall tax and the extension of the support package.
Energy efficiency boost welcomed by industry
Leaky homes are an increasing issue for the UK as it scrambles to both reach net zero goals, and to tame record energy bills – which are set to rise to £3,000 per year for average use from April despite further Government subsidies.
Earlier this year, the Government unveiled £1.5bn in funding to boost energy efficiency and cut bills for low income households across the country.
Installation rates across the UK have dropped sharply in the past decade from over two million homes per year to just tens of thousands after former Prime Minister David Cameron slashed previous efficiency schemes in the mid-2010s – as revealed in the BEIS Select Committee report on energy pricing earlier this year.
Currently just one third of UK homes have an energy performance certificate rating of C or above – the minimum standards the Government has set for domestic households by 2035.
This means an estimated 19m homes need retrofitting – with a study from EDF and Sprift earlier thuys year revealing the insulation age of UK homes to be at least 46 years old.
The energy giant surveyed 2,000 UK homeowners, which indicated more than than half (58 per cent) the country’s households only meet the insulation standards of 1976 or before.
Nigel Pocklington, chief executive of challenger supplier Good Energy, praised the support for energy efficiency but urged the Government to speed up its ambitions.
He said: “Investment in energy efficiency is crucial today. It requires a mass insulation campaign today, not a taskforce to look at extra spending in three years’ time. “
This was echoed by environmental think Green Alliance, which argued efficiency measures should have been making a dent in people’s energy bills this winter.
Sam Alvis, head of economy, said: “The Chancellor is asking people to wait another three years to get their home insulated when they urgently need help now. Promises for after the next election isn’t good enough