My business acts on the front line of the Energy Company Obligation (ECO) – which is sadly becoming the hottest topic in the green tax debate right now and having worked across previous Government schemes such as (CERT – Carbon Emission Reduction Target) as well as on ECO, I remain nothing short of baffled as to how the scheme is becoming a childish game of political football.
So what’s going on with the game of ECO? In keeping with my with football analogy, here’s my best attempt at commentary to try an explain the game we are all being subjected to…
An autumn kick off… So after an uneventful period of quiet play, in September Ed Millbands team spotted a pre-winter, vote winning opportunity and went for the attack by announcing an ‘energy price freeze from 2017’ should they win the Cup.
Ed then scored a scorcher of a goal by pledging to scrap the Green Deal as well as the ECO. (Ed: 1 – Dave: 0)
One nil up but the game was just getting started…
With the second half underway… In October the Energy Suppliers introduced an array of domestic energy price hikes, blaming 10% of the cost on the bill on green levys – a well rehearsed set piece of play. The blue team remained 1 nil down and were on the defensive, but not for long as David’s team responded with a hoof (‘pledge’) to ‘Roll back green levies’ at PMQs in the same month …(Ed: 1 – Dave: 1)
A pitch invasion stopped play… Play was stopped whilst both teams, energy suppliers and the energy industry all took part in a mass-scale pitch invasion to ascertain what the ‘roll back’ statement actually meant. Getting no-where fast and with the question unanswered, play continued.
A draw with all to play for … So, It’s the end of November, as it stands in this game of political football we are currently at a draw, with all to play for. The final whistle is expected to be blown on Thursday December 5th at the Autumn statement – what the outcome will be – only ‘Government’ knows.
Ok tongue in cheek but you get the picture. This has become a political football worthy of a lashing by Premier League veteran Ryan Giggs but will it last as long as he has?
I’ll be the first to shout that ECO is not without its flaws but the premise of an energy efficiency scheme that supports the most vulnerable as priority, is absolutely vital and not something to use as a ‘game’ or a ‘vote lever’. ECO Reform (not scrapping) is needed as there is far too much red tape preventing the right people accessing the right energy efficiency measures.
The cost of the red tape really is alarming – for example a direct cavity wall insulation (on an average 3 bed semi-detached with a lifetime saving of 27 tonnes of carbon) would set you back c.£1,200, through the current ECO scheme. Staggeringly the same measure would cost £2,700 due to the cost of red tape.
Of the forecast £2.5bn ECO scheme cost, £610m alone can be saved by simply removing the unnecessary processes and administrative burdens placed upon the ECO supply chain – it’s not rocket science but DECC really need to get their feet back on the ground before they make any proposed changes to the scheme on December 5th.
Energy policy makers remain too detached from the reality of green schemes so I’m urging DECC and Ofgem to experience their green policies first hand, to get back to the ground and see it all in practice.
So whilst the game plays on, one thing is for certain it’s not all over….. yet.
Alex Tsimboykas is Director of EUM Consultants Ltd