How we use energy – finite resources
Modern life depends principally on the burning of fossil fuels. At work and at home we depend on piped natural gas or electricity for cooking, water heating and space heating. Electricity, mainly the product of burning fossil fuels, is also used to operate mechanical and electrical equipment.
Of increasing concern is the life expectancy of our reserves of fossil fuels. New reserves of fuel have been found, and our ability to extract difficult-to-reach deposits has improved. This has merely postponed the date at which these finite resources run out.
For example, the United Kingdom’s production of natural gas from the North Sea peaked in 1999 and was 23% below this peak by 2005. This is because supplies are dwindling, not through any slackening of demand. We now import natural gas by pipeline and by ship from other countries.
Energy White Paper
In 2007 the government released it's Energy White Paper which has many implications for businesses. The Paper sets out a range of policy measures dealing with both security of supply and the need to put the UK on the path to a low-carbon economy.
Carbon Reduction Commitment
Government has indicated it will introduce a mandatory emissions trading scheme for the ‘large non-energy intensive’ sector. The threshold for participation, based on electricity consumption, has been doubled from 3,000 MWh/yr to 6,000 MWh/yr – a major concession to industry concerns over the disproportionate administrative burden associated with including smaller firms.
January 2010 has been muted as the earliest possible implementation date. Consultation issues include how auction receipts will be ‘recycled’, the definition of an ‘organisation’ and the case for a 6,000 MWh/yr threshold, including a cost-benefit analysis, needs to be presented.
Review of Climate Change Instruments
A review of the climate change policy framework is due to report in autumn 2007. The primary aim is to ensure there are no unnecessary duplications, inconsistencies or conflicts between key instruments such as EU ETS, CCAs and the CRC. An important issue is the long-term future of the Climate Change Agreements (CCA). The White Paper confirms a commitment to CCAs until March 2013.
Energy Performance Certificates
Government is to consult on a requirement to display Energy Performance Certificates in business premises in England and Wales. These Certificates will provide an energy rating (from A to G) for these buildings and will set out what steps can be taken to improve their energy efficiency.
Smart Metering
From 2008 all new household meters will be fitted with real-time displays. Between 2008 and 2010, suppliers will be required to provide all domestic consumers with such meters free on request, In 2007, government will consult on requiring suppliers to “extend” smart metering services to most companies within five years.
See also the summary of possible implications of the Energy White Paper.
and see EEF’s publication Sustainable Energy