LONDON (Reuters) – An energy act came into law on Wednesday which aims to boost energy efficiency in residential homes, the Department for Energy and Climate Change (DECC) said.
More than half of homes have insufficient insulation, and around 50 percent more energy is used to heat and power homes than is used to power industry, according to DECC.
“It is vital, therefore, that action is taken to address home energy efficiency,” the department said.
“The coalition is doing all it can to bear down on energy prices, but insulation will provide the long-term help to manage bills,” energy and climate change secretary Chris Huhne said.
DECC also said that the energy act would set in stone the legal framework for the ‘Green Deal’, which will be launched in autumn next year.
“The Green Deal will . help people insulate against rising energy prices, creating homes which are warmer and cheaper to run,” DECC said.
Climate change minister Greg Barker said that the Green Deal is “expected to attract capital investment of up to 15 billion pounds in the residential sector alone by the end of this decade and at its peak support around 250,000 jobs.”
The key elements to the energy act will remove the upfront cost of energy efficiency measures (like loft, cavity and external wall insulation, draught proofing and energy efficiency glazing and boilers) making expensive home improvement affordable.
DECC said that the energy saving work will be repaid over time through a charge on the home’s energy bill.
The act aims to provide financial help for the most vulnerable and hardest-to-treat homes by getting energy companies to fund work like basic insulation and boiler upgrades.
The act also aims to improve at least 682,000 privately rented homes.
“From April 2018 it will be unlawful to rent out a house or business premise which has less than an ‘E’ energy efficiency rating,” DECC said.
“The Green Deal scheme is innovative. Historically, Energy Performance Certificates have been seen as a white elephant. However, today’s regulations provide a strong incentive for landlords to pay attention to their building’s energy efficiency,” David Symons, director at consultancy WSP Environment & Energy, said.
But Symons said there were still hurdles to overcome before the legislation would be a success.
“Early indications are that customers may still have to provide an up-front payment to make the scheme work” and that the “scheme will struggle if high demand leads to shoddy workmanship.