Sustain Magazine submitted 24 February 2006

So the Energy Review is upon us, and although the government stood tall in its 1997 and subsequent election manifestos on reducing carbon dioxide emissions, it now admits that by 2010 it is forecasting to achieve only half of what it set out to back when “things can only get better”.

To do the government a little justice, things have got a bit (but only a bit) better. There have been some steps forward in energy efficiency – A-rated White Goods are now more the norm than the exception, a significant number of cavity walls and lofts have been insulated, the proportion of electricity generated from low carbon or renewable sources has grown, substantially, albeit still providing a paltry proportion of electricity generation.

But when these small steps are considered against both the long-term goal to reduce 1990 CO2 levels by 60% by 2050, and especially given that latest government forecasts predict achieving only half of the 20% CO2 cut by 2010, the approach taken to date has been, quite literally, half-hearted.

Today, “Our Energy Future” (readers may recall this was the title given to the 2003 Energy White Paper) also looks bleak. Annual electricity demand growth neither shows any sign of budging from the 1% - 1.5% we have seen for the last decade, nor does energy demand growth overall show any sign of becoming decoupled from economic growth.

Then there is the developing world to consider as well. Rapid economic growth gives rise to exceptional growth in energy demand. China, for example, will build more coal-fired generation in one year than today’s entire UK’s generating capacity.

Meanwhile, the impacts of Climate Change are all around us - Global temperatures are up 0.7deg C over the last 100 years, and expected to rise a further 1.4 - 5.8 deg C this century. This is expected to lead to a 9 – 88cm rises in sea levels, with all sorts of unpredictable severe weather impacts. Moreover, the International Energy Agency’s view is that current policies will lead to 60% increase in emissions by 2050.

All of these factors point to the need to find low, zero and even negative carbon solutions is urgent.

Energy Policy, however, is so often about the supply-side of the equation rather than the demand side. There is universal acknowledgement that energy efficiency is the most important opportunity to reduce greenhouse gas emissions. But in practice we achieve very little. A-rated fridges are all well and good, but if your old fridge is then used to keep the beer cold, your energy consumption has actually gone up, not down! Vehicle efficiencies may well be on the increase, but how does the population respond? By making more car journeys, or by owning more than one car! The problem is that we lack a proper understanding amongst the general public about the impact our daily lives, and the hourly choices we make, affects climate change.

Hopefully, this is about to change. The household sector is finally receiving some serious consideration to how it can contribute to carbon reductions on the supply side of the energy equation as well as through the most effective, albeit the elusive option of energy efficiency. We need something new to provide clean, safe energy, and with the government due to publish its strategy for the Microgeneration sector in April, that something could be in the form of households supplying power for themselves with microgenerators. In turn, this could well prove to be the “magic lever” that finally finds some aspirational dimension to consumers engaging in climate change – to use an out of fashion term – “sexing up” energy, with the latest “must have” gadget.

Microgeneration is the production of energy on the smallest of scales, for individual homes, other buildings or communities. It comes in many forms: photovoltaic (PV) systems produce electricity and solar thermal systems to provide hot-water and sometimes space heating, both directly from sunlight. Ground Source Heat Pumps use energy stored in the ground for space heating and micro-Combined Heat and Power (micro-CHP) that look and operate similar to gas boilers whilst providing electricity as well as heat. Micro turbines, either powered by the wind or naturally flowing water, provide electricity and the latest development is the roof-mounted wind turbine. Hydrogen powered fuel cells to provide heat and electricity are also currently being developed and are expected to emerge in the next few years. The use of renewable fuels (wood pellet or biogas / bioliquids) to displace natural gas for conventional heating or indeed for combined heat and power is also a viable option.

Some of these technologies are more accessible than others but all can deliver on at least two of the four energy policy objectives. For example, a micro-CHP unit will deliver the same comfort levels as a modern boiler, whilst reducing the emissions of a typical house by 1.5 tonnes (around 25%) of CO2 per year. This can help relieve fuel poverty, supply 1 - 5kW of peak electricity generating capacity - and provide the major utilities with some competition. Moreover, if just one quarter of all gas boilers that will be replaced between now and 2020 are replaced with ones that can generate power, the capacity this will bring is the equivalent to just under half of that provided by today’s nuclear power stations.

Research into the potential of microgeneration is increasing and a recent study estimates that microgeneration could contribute between 30-40% of electrical demand by 2050. Another recent study rewards microgeneration with deserved recognition for actually acting as a catalyst for cultural changes in consumer attitude and behavioural shifts towards energy use.

So why has microgeneration had a slow take up so far? Regulatory barriers certainly exist - the so-called “competitive” energy market is structured in a way that favours large players and loads disproportionate transaction costs onto the smallest. Even the regulator’s duties only protect consumers in relation to energy conveyed through distribution networks, and not energy they produce themselves, even though this energy is subject to some of the same rules and regulations There are currently regulatory barriers for customers in obtaining permission for and connecting microgenerators as well as for exporting surplus power to the grid, but perhaps a more significant obstacle for microgeneration is technology costs. Microgeneration at mass market level will occur when prices fall and for this to happen, developers need to attract investment to fund mass production development and manufacturing capacity. Against today’s highly uncertain energy policy background such investment is a significant challenge which is exactly why policy measures are so significant.

The good news is that political support is now substantial and Labour MP Mark Lazarowicz’s Climate Change and Sustainable Energy Bill is now entering its final stages to becoming law. The bill presently contains valuable measures for micropower, supported by the government, including; establishing national targets, granting permitted development for certain technologies, rewarding customers exporting electricity, recognition within the Building Regulations and the forthcoming Code for Sustainable Homes, promotion of renewable heat, empowering local authorities to introduce local energy schemes, amending the duties of the electricity regulator – OFGEM, , providing consumers with easier access to existing support mechanisms for renewables, extending energy efficiency policies to cover all forms of microgeneration, and a duty on government to consider dynamic demand technologies which can adjust their electrical consumption in response to changing second by second conditions on the grid. It remains to be seen whether the government will also agree to other measures designed to place microgeneration on the agenda of local authorities.

Microgeneration, although somewhat of an obvious solution to the growing energy problems we begin to face, is a radical if progressive shift from the existing large-scale generation that we have become accustomed to. The question is; whether the UK is prepared to take on the challenge of using microgeneration to act as a catalyst for cultural change amongst the general populus, or whether the easy buttons of large-scale supply-side measures will continue to dominate energy policy for the next 50 years, just as they have for the last 50.