How Can Governments Encourage Energy Efficiency?

Almost any news website will have a section covering the latest environmental developments, and most of this section will be dedicated to renewable energy. However, improvements in energy efficiency can make a much larger difference in terms of carbon emissions, and these solutions are often much simpler and most cost effective to implement. So, how can governments encourage energy efficiency?

The issue is that whilst electricity or gas consumption is a huge problem on a national scale, an unfortunately large number of households do not feel much incentive to improve on their personal energy efficiency because their electricity bill, for example, represents only a small fraction of their overall monthly expenditure. This is where the government needs to step in, to make sure that everyone takes a few small steps to make a much bigger difference across the country. What are some of the techniques they can use to cause this change?

 

Modern technology is very exciting – gadget magazines fly off the shelves of newsagents, and everyone is desperately seeking the latest phone or laptop. However, apart from the obvious financial cost of buying these items, there is an increasing environmental impact too. More powerful processors require more energy to run – long gone are the days when a cell phone could be charged just once a week, with most requiring a daily boost. This means that it is becoming increasingly important for the government to control just how much energy these products are using, otherwise producers are liable to follow the demand of consumers, increasing power consumption to make sure they’ve got the most cutting-edge products, regardless of the environmental damage. Carefully implemented controls can reduce this damage, as well as helping our finances.

The source of most of the world’s energy is the home, and in particular heating and cooling it at different times of year. Building codes can be introduced to force the property itself to be well insulated against the loss of hot or cold air. A very significant impact can be had in this area – in the U.S., for example, 70% of the electricity supply, and 36% of the natural gas supply are used by households, and nearly 90% of the increased electricity use from the 1980s to the present day was from households using more electricity. This means that the shift in electricity use is away from businesses and into homes, tying in with improved standards of living as we all leave the heating or air conditioning switched on for longer and longer. Investments in this area quickly pay themselves off – loft insulation costs only $200-$300, and will pay itself off within less than two years in energy bill savings.

Changing consumer behavior is a grass-roots approach, and rather than changing the products, if people can be made to change their behavior, demand for energy efficient products will rise and manufacturers will meet this demand if they’re trying to maximize their profits.

A common example of this is dishwashers, fridges, and washing machines – in the U.K., they have large stickers displayed prominently on them displaying their energy efficiency. Since this pushes demand away from inefficient items as people are made more aware, manufacturers are driven by the market into improving their products, saving energy. Dishwashers made in 2012, are up to 30% more efficient than dishwashers made in 1995, largely thanks to these measures encouraging technological improvements.

If consumers’ minds can’t be changed, a little cash can often help! In many cases, such as solar panels, or energy efficient boilers, even though they can offer an excellent return as an investment item, they are not at the fore of people’s minds. Governments can introduce schemes which provide extra income for those picking environmentally-friendly products – such as the 30% federal grant available across the U.S. For solar panels, or the world-renowned Feed in Tariff scheme in Germany, offering returns of 8% or more.

A careful combination of all of these measures can benefit everyone, and is a good long run approach, particularly when combined with renewable energy generation. However, great care needs to be taken in the way mandatory rules and regulations are put into place. The latest technological products have to be researched, developed and built, which takes years – if the government suddenly steps in and changes the requirements for certain products, then this could have a disastrous economic effect.

Similar rules must apply to building regulation – the construction of a large block of flats must have energy efficiency measures included as part of the design from the start of the project, and so significant changes to rules need to be phrased carefully to prevent major projects being pushed into financial difficulty. The time taken, however, is well worth it.

Article written by James Hawkins, who works for a renewable energy and home improvement company providing a boiler prices comparison in the UK.

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