RAP Senior Associate Jan Rosenow provided expert testimony to the UK House of Commons’ Public Accounts Committee, which has launched an inquiry into the Green Deal and the Energy Company Obligation (ECO). View his testimony here.
The Green Deal was a short-lived energy efficiency policy instrument that enabled households to finance energy efficiency improvements with the loan repayments being attached to the electricity meter rather than the person taking out the loan. ECO was the seventh phase of Energy Efficiency Obligations in the UK since they started in 1994.
The Public Accounts Committee’s inquiry follows a publication on the Green Deal and ECO by the National Audit Office (NAO), an independent body that scrutinises public spending for Parliament. The NAO concluded that “the Green Deal has not achieved value for money. The scheme, which cost taxpayers £240 million including grants to stimulate demand, has not generated additional energy savings.” Furthermore, the NAO stresses that the Green Deal and ECO have only delivered 30 percent of what previous schemes achieved in terms of energy savings. A key piece of evidence for this, and the only piece of academic work cited by the NAO, is a paper by RAP’s Jan Rosenow and Nick Eyre from Oxford University.
“The introduction of the Green Deal, which was meant to revolutionise and transform energy efficiency, resulted in a collapse of the domestic energy efficiency market. This is perhaps ironic, but was not unexpected to informed observers” says Dr. Rosenow. “The introduction of the Green Deal also led to Energy Efficiency Obligations being focused in areas in which they were less immediately effective, with the result that the energy-saving targets have now been substantially reduced.”
RAP is developing ideas for reinvigorating energy efficiency policy in the UK. The UK has achieved substantial gains in energy efficiency in the past and RAP engages closely with government and stakeholders to create a more ambitious energy efficiency strategy going forward.
“The UK has decades of experience with successful energy efficiency programmes,” states RAP director of European programmes, Richard Cowart. “The Green Deal experiment is over and we have learned what doesn’t work. Now government and industry have a fresh opportunity to launch far better programmes that offer savings across all bill-paying households and business customers, while improving Britain’s energy security, reducing fuel poverty, and lowering carbon emissions.”