People don’t trust energy companies to give them advice about energy efficiency
People don’t trust energy companies. So why are power providers being asked to persuade householders to install subsidised energy measures?
Energy companies say it’s difficult to persuade consumers to insulate their homes, even when government subsidies are on offer. And yet two thirds of people would make their homes more energy efficient if someone told them how, according to a new poll for the Energy Savings Trust.
But does that ‘someone’ include the energy companies? The polling also suggests that it probably doesn’t.
Arguments about ‘green taxes’ are largely about energy efficiency
Levies on consumer energy bills pay for government measures to increase energy efficiency, support renewable power, and help low-income households insulate their homes. Together they make up about nine per cent of the average bill.
Despite a media fixation on subsidies for windfarms, energy efficiency measures account for a larger part of the green levies:
Bar chart showing how the government’s climate and energy policies add to the average consumer energy bill. Subsidies intended to increase energy efficiency or help low-income households pay energy bills are coloured blue; subsidies for low-carbon generation are coloured grey. Source: DECC data.
The Energy Company Obligation ( ECO), which requires energy providers to seek out low-income households and subsidise home insulation, accounts for a particularly large chunk. The policy forms a part of the government’s plan to tackle fuel poverty, and energy companies have criticised the scheme for being too expensive.
Now, in the face of rising bills and energy company hostility to ECO, government is considering cutting the programme altogether, according to media reports.
Not much trust in energy companies
ECO requires energy companies to find householders eligible for the scheme. But utilities say that’s difficult – partly because data protection rules mean they don’t have access to the government’s data about low-income households and benefits claimants.
When they do find the right people, householders often aren’t interested in having the measures installed, the companies say. A spokesperson for supplier RWE Npower tells us that on one occasion the company marketed a previous government scheme for subsidised insulation. It offered a £50 gift to anyone who would ring in about the scheme – and out of 120,000 people, only six rang in.
Why? An Ipsos Mori survey for the Energy Savings Trust suggests a possible answer.
64 per cent of respondents said they “would be more energy efficient in the home if someone told them how”. But 60 per cent said they didn’t want energy efficiency advice from utilities. Just over two thirds – 68 per cent – said this was because they believe energy companies are only interested in making money, not helping them.
Consumers may trust local tradespeople more than energy companies. 58 per cent of respondents said they would be most likely to hire a small local firm to do work on their home. But the poll also showed only 18 per cent of tradespeople give energy efficiency advice.
So people don’t trust the energy companies to give them energy efficiency advice, and don’t get information about energy efficiency from the people they trust more. Not a great recipe for implementing an major government programme of home insulation.
Energy efficiency scheme may be cut rather than fixed
It probably isn’t a hopeless situation – although energy companies opposed to the scheme may argue that it is. First, energy companies don’t need to work alone. Npower tells Carbon Brief that it employs small businesses to install energy efficiency measures once households have agreed to them. That doesn’t fix the problem of getting people to agree to the measures in the first place, but it seems a sensible step.
Other commentators have suggested that energy efficiency programmes would work better if they were implemented – and presumably marketed – in partnership with local councils. Or the programme could even be separated from energy companies entirely. Merlin Hyman, chief executive of sustainable energy company Regen SW, told the conference last week:
“My view is we would be much better off where the money was taken off an put into a programme of energy efficiency where it’s delivered locally but managed by public servants in some way, I think we should break the link between these schemes and the energy suppliers”.
There’s not much disagreement that insulating the UK’s housing stock – among the least energy efficient in Europe – should be a central part of any plan to reduce greenhouse gas emissions and tackle fuel poverty.
But looks as though ECO may fall victim to a continuing political row between the Lib Dems and Conservatives over ‘green’ subsidies. George Osborne wants to use his Autumn statement to cut green measures, according to the Telegraph – and ECO is in the firing line.