Green Alliance and WWF call for introduction of energy saving Feed-in Tariff
The environmental think tank Green Alliance and green campaign group WWF are calling on the Government to adopt a Feed-in Tariff (FiT) to incentivise energy efficiency and create a ‘market’ for electricity savings.
The proposal is contained in a new report published today by Green Alliance and WWF, which concludes that an Energy Efficiency FiT (EE FiT) could reduce electricity demand by 40 per cent by 2030 and save in excess of £10 billion per year, a target highlighted in a McKinsey report commissioned by the Government last year.
The WWF/Green Alliance report comes in the wake of major increases in energy bills by almost all the Big Six energy firms and ahead of meeting on Thursday of senior Ministers, including David Cameron, George Osborne and Nick Clegg, on the content of the Energy Bill, which aims to set the framework for clean, affordable energy in the UK.
The report says the Energy Bill is a “one-off opportunity” to save money and energy, but in its current form contains nothing to reduce demand for electricity and therefore will only deliver a third of the electricity saving potential of the UK by 2030.
After examining a number of potential energy efficiency measures, it concluded an EE FiT would the “simplest” solution, and could even complement other energy saving policies such as the Green Deal, which the Government launched on October 1.
The EE FiT would work much in the same way as the existing Feed-in Tariff that incentivises renewable energy adoption, but instead of providing a predictable payment for each unit of renewable energy produced, it would provide one for each unit of electricity saved, or ‘negawatt’. It suggests it would create a new energy efficiency market, which would encourage new entrants and innovation in the energy market, as companies tried to find the best ways to cut electricity use.