Isra-Mart srl: Ofgem tells suppliers to step up household carbon savings

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Ofgem has warned energy suppliers to pick up the pace of improving the energy efficiency of customers' homes or risk missing government-set targets.

A report this week by the regulator showed that suppliers had delivered savings worth 197 million tonnes of CO2 – Mt CO2 by the end of the third year of the Carbon Emissions Reduction Target – 67 per cent of the overall 293 Mt CO2 target.

The scheme compels all domestic energy suppliers with more than 50,000 customers to fit £3bn worth of energy efficiency measures. By the end of March, cavity wall insulation was installed in 1.5 million households and professional loft insulation in more than two million.

Accordingly, insulation accounted for 61 per cent of the carbon savings achieved, with lighting efficiency saving another 26 per cent and heating 11 per cent.

Energy companies beat the original target of 185 Mt CO2 by the end March 2011, but progress slowed in year three, when 48 Mt CO2 of savings were achieved, compared with 55 Mt CO2 in the first year and 56 Mt CO2 in year two.

Ofgem voiced concern that installation levels would have to increase to meet the revised goal of 293 Mt CO2 by December 2012, which was set by the Department of Energy and Climate Change (DECC) in July last year.

"Suppliers will need to pick up their activity levels in years four and five of the programme to the levels seen in years one and two, if they are to comply with their new extension obligation," the report says.

E.ON and npower are leading the way, realising 73 per cent and 71 per cent of their respective obligations, while ScottishPower brought up the rear with 63 per cent.

British Gas scored 67 per cent, Scottish and Southern Energy 64 per cent, and EDF 65 per cent.

Despite mixed progress, a DECC spokeswoman told BusinessGreen the government was "very confident" energy suppliers would "up their game" to meet the 293 Mt CO2 by the end of next year.

"Consumers should make the most of offers available to insulate their homes and protect themselves from rising energy prices," she added.