Guy Newey

Renewable costs on bills to double due to European target

As officials try to meet the Prime Minister’s promise to roll back the ‘green levies’ and cut the ‘green crap’, lots of attention has focused on the Energy Company Obligation (ECO), the Coalition’s flagship energy efficiency policy. Its aim is to improve the state of the UK’s woeful housing stock and to reduce the amount of heating people use.

The scheme is far from perfect. It offers too many subsidies to expensive measures like solid wall insulation, rather than much cheaper ones, such as loft insulation. Also, it has yet to show support for charity incentives that show people how to use less energy. But the general ambition is right. The only sure way you can get people’s bills down in the long term is by reducing their demand for energy.

Since 2005, energy use by UK households has fallen by a quarter.

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