The Tory energy policy mess – stalled, obstructed and scrapped nuclear, renewables and home efficiency
I wonder if Theresa May’s pause for thought on Hinkley Point C will also mean a rethink about the Tories’ sceptical and obstructionist attitude to renewables and energy efficiency. I am open minded about the role of nuclear energy, as long as the costs can be brought down. I hope the new government, as it increasingly seems to be distancing itself from the Cameron era, becomes more open minded about the other essential components of our energy mix.
My experience in government was that the Tories were at best sceptical and often openly hostile to investment in renewable energy and measures to reduce home energy consumption. Their hostility to wind energy in particular stemmed mainly from party political considerations. Cameron allowed ministers to fulminate against wind farms and to actively use the planning system to obstruct their construction. This was not based on sound engineering or cost grounds, rather it was a political need to see off UKIP and placate the Tory backbench headbangers and climate change deniers. This tendency of Cameron to throw red meat to those that snarled the loudest at him was as bad for energy policy as it was disastrous for our place in the European Union.
When I became Communities Minister in 2013 one of my responsibilities was regulation of the building industry. The suite of building regulations covered everything from fire safety to the design of staircases. They also covered energy efficiency. I’d been saying for years that as well as switching our energy sources of supply away from carbon towards renewables we should also look to reduce demand if we are going to make any meaningful contribution to reducing greenhouse gases. The first Liberal Democrat minister at DCLG, Andrew Stunell, had tightened building regs in 2011 so that house builders had to do more to improve insulation and install energy efficient heating systems. My officials explained to me that there would be a chance to go further and bring to life a concept that had been around since the Brown government, of “zero carbon homes.”
Like a lot of buzzwords from the Labour era, zero carbon homes was a misnomer. No house could be built without consuming resources and no family living in the house would live a cold life in the dark. But it was certainly possible to further reduce energy consumption and also require housebuilders to make a contribution to low carbon energy projects. Officials and housebuilders had invested several years in working up proposals. After several briefings with my talented and knowledgeable officials I met with a group of housebuilders who told me that what they wanted from government was policy clarity. Neither the previous Labour government nor the coalition had actually committed to introducing the legislation necessary for a zero carbon homes standard to operate by the original target date of 2016. So I undertook to make the case inside government.
I could (and will!) write another blog entirely about the policy making process and wheeler dealing that went on inside the coalition government. But suffice for now to say that to get anything signed off that was a policy priority of one party needed the agreement of the two Cabinet Office ministers from each side, Oliver Letwin for the Conservatives and David Laws for the Liberal Democrats. So I found myself in many meetings with Oliver in number 9 Downing Street, with a view down the street of the comings and goings through the most famous front door in the world. Eventually it was agreed that we would proceed and zero carbon homes would be part of an Infrastructure Bill in the final session of Parliament of the coalition. I’m sure the Queen has read out lots of eye brow raising proposals from her twelve Prime Ministers but on 4th June 2014 I watched with pleasure as she said “Legislation will allow for the creation of an allowable solutions scheme to enable all new homes to be built to a zero carbon standard”
The proposals I took through Parliament would require housebuilders from 2016 to further improve the energy efficiency of new homes. My visits to lots of building sites plus the amazing Building Research Establishment (founded by Lloyd George as part of his promise to build “homes fit for heroes”) at Watford had shown me what could be done on site. Brick design, wall insulation, glazing enhancements and making triple glazing the norm could all make a contribution. Boilers were getting more efficient. Homes could also be built with photo-voltaic panels to generate the house’s own energy. But only so much could be done on site and to new houses. The location of some sites would not be suitable for solar energy. The vast majority of our existing housing stock was built without energy efficiency as a consideration.
Greater returns for investment by housebuilders would be found in retrofitting older homes or by funding other low carbon projects. I wanted to have a wide range of options for housebuilders to invest in the “allowable solutions” for off-site carbon off-setting. Retrofitting Victorian housing was an obvious example but I was also keen on funds for electric car charging points, cycle routes and possibly a direct financial contribution to the Green Investment Bank that had been set up by Vince Cable.
The allowable solutions menu was to be worked up once the Infrastructure Act became law. This is what should have happened during the second half of 2015. Oliver Letwin had told me that imposing more regulations on house builders would not have been done if the Conservatives had been in government on their own. So it was no surprise but still a deep disappointment that in July 2015 George Osborne announced that the new Tory government would suspend the scheme. With no sense of irony the Chancellor included his scrapping of my scheme in his proposals for a productivity plan to increase national prosperity. The allowable solutions scheme would have been a huge boost to the low carbon economy, stimulating investment right across the country. To make matters worse, Osborne also cancelled the uplift in on site home energy efficiency.
Theresa May has a reputation for immersing herself in the details of policy. On home energy efficiency the work has already been done and the legislation is in place. Whether or not to proceed with more nuclear plants is horrendously complicated. But it should be a no brainer to realise that reducing demand for energy in our homes will reduce the need for a new supply of nuclear energy. Our new PM has shown that she has no qualms about overturning the decisions of the Cameron-Osborne era. Let’s hope that she acts now to get us back on track for zero carbon homes. By doing so she will demonstrate that she understands that as well as diversifying our energy supply we also need to manage down demand if we are to have a sustainable future. Housebuilders are well prepared to make the transition and householders would thank her for the lower bills. And our small part of the planet would breathe a little easier.