Energy efficiency loophole risks major cost to the energy system

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Britain’s landowners could cost the energy grid millions of pounds by using loopholes in the Government’s housing standards to avoid developing ­energy efficiency.

Landlords are foreseen to file for ­exclusion from the incoming efficiency policies to avoid shouldering the cost of improving the country’s most inadequately insulated areas, at a major cumulative cost to energy users who will pay for new energy ­capacity through their bill statements.

By improving 300,000 homes at the lowest end of the energy efficiency program, consumers could save £600 on each power bill statement. This totals £180m in savings on electricity bills overall, and the value of creating a new gas-fired plant or two huge wind farms.

Association for the Conservation of Energy representative Joanne Wade announced “the bigger prize” would be a progress to cover all houses under a C band of ­energy efficiency.

“The total annual energy savings would be the equivalent to turning the Drax coal plant off for eight months, or avoiding construction of 4GW of new capacity,” she said.

She added that the power savings could represent a significant role in solving the growing uneasiness over rising ­energy prices – but new policies making it simpler for landlords to invest in warmer places would be needed.

In the current regulation, landowners can petition for an exclusion to standards if they cannot obtain funding to begin the work at no upfront expense.

This rule was proposed with the Green Deal, but Ms Wade has cautioned that landowners will find it easier to file for an exclusion. Instead, it is recommended that a maximum cost threshold of £600 should be set so landowners can tackle simple efficiency standards that could result in significant energy savings.