The UK’s Energy Market Reform was introduced for two main reasons: concern that inadequate private investment under the liberalized system was eroding the UK’s security of supply, and growing recognition that the existing system of Renewables Obligation Certificates (ROC) support was an inefficient way to support capital-intensive, low carbon investments like renewable energy. The EMR was intended to address these concerns. Contracts-for-Difference (CfDs), providing a long term fixed-price contract, were introduced to enhance investor confidence and thus reduce financing costs; CfDs were seen not only as a preferable way to support renewable energy, but also one applicable to nuclear energy. The Capacity Mechanism introduced fixed payments to all plants guaranteeing power available when needed. (more…)
By Peter Mallaburn and Ian Hamilton, UCL Energy Institute
Over the past 25 years, the UK residential sector’s energy efficiency policy has primarily been directed through a combination of: programmes requiring energy suppliers to retrofit efficiency improvements; building regulations; appliance efficiency standards; and more recently a short-lived market-based approach, the ‘Green Deal’. These programmes have had multiple aims: to reduce general consumer exposure to rising energy prices (sometimes with other benefits eg. warmer and/or quieter homes from double-glazing); to reduce national energy dependence and environmental impacts; and to protect vulnerable customers.
With energy policy once again in a state of flux, it is worth now briefly reviewing some of what has happened within the residential energy policy landscape over the past 25 years, and offer some insights for future policy. (more…)