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On the day briefing – Heat & Energy Saving Strategy

12 February 2009

The government today published three consultations:

1. Changes to the Carbon Emissions Reduction Target (CERT)
2. The new Community Energy Saving Programme (CESP)
3. The Heat and Energy saving strategy

We would encourage member councils to respond to the consultations. Further

information and the consultations are available at www.http://www.decc.gov.uk/hes

LGA key messages

• Energy suppliers should pay a £500 million annual charge to help fund a
comprehensive home insulation programme that would lift half a million
people out of fuel poverty. This would match the contribution householders
already pay for the three year CERT through their energy bills.

briefing
LGA research last September showed that the energy supplier’s dividend
payments in 2007 were £1.65 billion (an increase of £275 million from
2006). If suppliers provided an additional £500 million each year to CERT,
from their own profits, all remaining lofts and cavity walls could be insulated.

• Councils should lead such a national programme, delivering measures street-

by-street across their communities.
• By investing more in home insulation, ten million households would each
save £280 a year on their energy bills, 500,000 people would be lifted out of
fuel poverty and up to 20,000 new ‘green’ jobs would be created in areas
such as renewable energy and provision of insulation.

1. Changes to the Carbon Emissions Reduction Target (CERT)

In September the Prime Minister announced that the CERT target on energy
suppliers would be increased by 20% - an extra £510 million. The announced
consultation is to enable the necessary change to the secondary legislation.

Changes have further been proposed to incentivise topping up loft insulation, to

Local Government House, Smith Square, London SW1P 3HZ

allow suppliers to claim energy savings for conducting home energy audits and for
Information centre 020 7664 3131 www.lga.gov.uk

consumption display devices.

DX 119450 Clerkenwell 3 Email info@lga.gov.uk

In September the Prime Minister also committed to insulating six million homes by
2011. However, the LGA predicts that CERT will only insulate four million homes.
Tel 020 7664 3000 Fax 020 7664 3030

LGA key messages

• The LGA welcomes the increased target. We want to see all of the
additional £510 million spent on insulation, which could deliver an additional
one million insulation measures.
• CERT should be changed to focus on delivering insulation measures. The
proposed inclusion of audits and display devices would make it easier (and
cheaper) for suppliers to meet their targets. The long term energy savings
from these measures have yet to be proven.
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For further information please contact Kirsty Ivanoski in LGA public affairs
Kirsty.ivanoski@lga.gov.uk 020 7663 3120
 • In September the Prime Minister repeated that the additional £510 million
should not be passed on to consumers, however there is no mechanism to
ensure this and suppliers could pass on the costs to householders.

2. The new Community Energy Saving Programme (CESP)

The CESP plans to require energy suppliers and – for the first time – generators to
deliver insulation measures in community schemes and working with community
partners.

It will include more expensive and disruptive measures such as solid wall insulation
and aims to provide whole-house solutions to people in deprived areas.

The consultation proposes around three thousand eligible areas leading and aims for
around one hundred schemes helping around one hundred thousand households.

LGA key messages

• This community-focused proposal is a step in the right direction but it is very
small scale compared to CERT, and therefore is unlikely to provide capacity
building to help set up new community schemes.
• Energy companies must be required to work with the local council who can
help them identify suitable areas with harder to treat properties. Councils are
uniquely placed to lead and coordinate community based schemes and in
particular can help the generators and new entrants to this field.
• We are concerned that, similar to the increase in CERT target, there is no way
to ensure the £360 million predicted spend for CESP is not passed on to
consumers.

3. The Heat and Energy saving strategy to 2030

The consultation to establish a heat and energy saving strategy takes a longer view
for tackling the housing stock. It suggests ways for existing homes to receive
insulation, renewable heat and/or microgeneration. It aims to address the building
fabric, behaviour change and energy using goods in the home.

LGA key messages

• A Heat and Energy saving strategy must provide the opportunity to address
all homes including those which are hard to treat homes by installing solid
wall insulation, renewables and renewable heat.
• Councils should be at the heart of delivering this scheme. As those with
local knowledge they are best placed to identify and deliver appropriate
solutions to help people cut fuel bills and save carbon, and can provide the
necessary advice and support to residents.

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For further information please contact Kirsty Ivanoski in LGA public affairs
Kirsty.ivanoski@lga.gov.uk 020 7663 3120