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Government plans higher efficiency standards

04 April, 2023

The UK Government is planning to raise Meps (minimum energy performance standards) and to strengthen energy labelling requirements for energy-using products, to help cut energy demand. This was revealed in the more than 2,000 pages of documents that accompanied the recent launch of its Powering Up Britain plan for the future of energy security in the UK.

Although the new strategy focuses mainly on energy supply issues, it also contains some information on the Government’s plans to help curb energy demand. For example, the Meps activities, which are starting this year with a consultation on lighting, will be followed by other, unspecified technologies over the coming year.

Other demand-side measures outlined in the documents include:
• plans to launch a digital energy advice service this year to give impartial advice on improving energy efficiency to small businesses, aimed at cutting their energy use and bills;
• piloting a new audit and grant scheme, also this year, to help small businesses to move from insight to implementing energy efficiency measures;
• extending the Climate Change Agreements Scheme by two years, as announced in the Budget, to provide reduced Climate Change Levy rates for eligible businesses in more than 50 industrial sectors, worth an estimated £300m a year;
• facilitating and promoting the “extensive deployment” of rooftop solar power arrays on industrial and commercial properties to make maximum use of the available surfaces; and
• extending the Industrial Energy Transformation Fund (IETF), and increasing the total grant funding available to £500m. Subject to the business case being approved, the Government plans to open a third phase of the IETF to new applications in early 2024, helping industry to cut energy bills and carbon emissions by investing in high-efficiency and low-carbon technologies.

The Government is also committing itself to supporting industrial fuel switching, and says it wants to replace 50TWh of fossil-fuel-powered processes by electrical alternatives by 2035. It says that this transition has the potential to cut the UK’s annual industrial greenhouse gas emissions by 7-19 million tonnes of CO2 equivalent, contributing 15–40% of the required carbon abatement in industry by 2050.

It adds that the level of electrification uptake will depend on a secure supply of electricity, grid access, technology innovation, and the relative cost of electricity compared to other fuels. “We recognise that there are barriers to fuel switching to electricity – including the relative cost of electricity compared to gas – and we plan to launch a call for evidence in 2023 to seek views on overcoming these challenges,” the Government says.

NatWest CEO Alison Rose is co-chairing the Government’s Energy Efficiency Taskforce which is due to publish an action plan this summer

Earlier this year, it launched an Energy Efficiency Taskforce, co-chaired by NatWest CEO Alison Rose and Lord Callanan (minister for business, energy and corporate responsibility), with the aim of supporting energy security and decarbonising buildings and industry. The Taskforce is developing an action plan which it plans to publish in the summer.

The Government says that the Taskforce will play a vital role in bringing government and business together to deliver ambitious resource efficiency and energy efficiency (REEE) savings. It will advise and work with ministers on delivering the government’s ambition to cut the UK’s final energy consumption from buildings and industry by 15% by 2030, compared to 2021 levels. This applies to domestic and commercial buildings as well as industrial processes.

REEE measures could contribute up to 12 million tonnes of CO2 equivalent of annual savings by 2050 (excluding potential additional savings from the iron and steel sector).

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