Zero ambition

This is a laudable, far-sighted attempt to kick-start the UK’s renewables industry.

Even the most energy-efficient homes will still need some form of electricity supply to meet the loads created by domestic appliances. On-site generation is one way of meeting this demand. But it will be more expensive than, say, using a remote wind-farm to generate electricity and feed this into the grid.

Wind-farms are, by their nature, best suited to wild, exposed and undeveloped locations, which makes them unpopular with conservationists and planners. This introduces a note of uncertainty about their potential to meet future energy needs.

It is time for a new approach. The economic trade-off between cheaper remote generation and less economic on-site generation has to be seen in the context of stimulating the UK’s fledgling renewables market. Investment in these products should help make the technology more cost-effective for both new and existing housing. And if the RAB’s claims are to be believed, then the government’s zero carbon homes policy could generate a new market for solar water heating, wind turbines and CHP, to name but a few, that could be worth more than £3 billion a year.

As the RAB acknowledges, the weakness of this policy is the lack of construction industry skills and the need for a large expansion in manufacturing and installation capacity. The key to success will be in stimulating the demand for the technology. This will need government intervention, perhaps through the introduction of a feed-in tariff for on-site renewables or through mandating a minimum renewables requirement on every new development – much like the Merton Rule.

There is a clear need for early government action in support of this recommendation. Unfortunately, this administration’s record on initiatives to tackle climate change has been woeful. Without government support this will be another missed opportunity.