A report published by think tank Green Alliance has claimed that the UK public could save as much as £2.5 billion by 2025 if the government introduced a feed-in tariff for energy efficiency technologies.
The independent think tank said the report, dubbed ‘Getting more from less: realising the potential of negawatts in the UK electricity market’, demonstrated how the UK’s electricity market was “distorted in favour of supply side measures” and neglected the need for better demand side technologies.
Green Alliance said this could be resolved with a new ‘negawatts’ strategy which creates financial incentives for saving electricity at less than half the cost of building new power generation capabilities.
The negawatts feed-in tariff proposed by Green Alliance would pay out based on avoided energy consumption and allow receivers to compete in an open auction to deliver electricity savings through technologies such as LED lighting in homes. The report claims this could reduce electricity demand by 6.4GW by 2030 and yield net savings of £2.4 billion by 2025.
The report also states that opening the UK’s capacity market to competition from demand-side response and energy demand reduction on an equal basis with generation could create an additional 6GW of load shifting and reduction by 2023.
Lead author Amy Mount said that negawatts are a “no-brainer” for consumers. “Not only are they the cheapest way to reduce carbon emissions. They also reduce the pressure on the electricity system by reducing peaks in demand,” she said.
“These policies would save the UK huge amount of money, by avoiding the construction of unnecessary power stations. If government wants to reset energy policy for the benefit of consumers this is where they should start,” Mount added.
The report comes just two weeks after a separate study by the Association for Decentralised Energy claimed that the UK could save £3 billion per year on energy costs by adopting “immediate and practical” energy efficiency technologies.