Reducing Energy Bills Through Energy Efficiency Programme

ABSTRACT

Energy efficiency belongs at the heart of a low-carbon economy. By reducing energy use and cutting down on waste, we can reduce energy bills, make our energy system more sustainable, and drive down greenhouse gas emissions.

Too often, governments have neglected the role that energy demand reduction can play in managing our energy system. Yet measures that reduce demand can contribute in a more cost-effective way to meeting our energy and climate goals than supply-side measures. That’s why energy efficiency – as a way of reducing demand.

This strategy sets the direction for energy efficiency policy for the coming decades. It makes clear our ambition, the barriers that we need to address, and the additional steps we are taking now to stimulate the energy efficiency market. It shows how we will act to connect finance with demand, encourage innovation, and make energy efficiency information more accessible to the consumer.

Energy efficiency can reduce energy bills for households and businesses, and can boost the economy in a sector with great potential for future growth, driving innovation in the process. The prospect of achieving more with less energy is an exciting one, and this strategy sets out the opportunity in full.

CHAPTER ONE

 CHAPTER ONE

1.1                                                        INTRODUCTION

Countries like Nigeria  now has a huge opportunity to optimize the energy use of both domestic and business customers, reducing bills and/or warming homes, while at the same time, delivering a more sustainable society. Individuals can do this through taking action to reduce their demand, such as turning off energy using products that are not in use, buying products that are more efficient or installing energy efficiency measures in their homes. Businesses can take similar actions, reducing their long term operating costs.

Efficient energy use, sometimes simply called energy efficiency, is the goal to reduce the amount of energy required to provide products and services.

There are many motivations to improve energy efficiency. Reducing energy use reduces energy costs and may result in a financial cost saving to consumers if the energy savings offset any additional costs of implementing an energy-efficient technology. Reducing energy use is also seen as a solution to the problem of reducing greenhouse gas emissions. According to the International Energy Agency, improved energy efficiency in buildings, industrial processes and transportation could reduce the world’s energy needs in 2050 by one third, and help control global emissions of greenhouse gases.^[2] Another important solution is to remove government-led energy subsidies that promote high energy consumption and inefficient energy use in more than half of the countries in the world.^[3]

Energy efficiency and renewable energy are said to be the twin pillars of sustainable energy policy^[4] and are high priorities in the sustainable energy hierarchy. In many countries energy efficiency is also seen to have a national security benefit because it can be used to reduce the level of energy imports from foreign countries and may slow down the rate of energy at which domestic energy resources are depleted.

Reducing energy use in your home saves you money, increases our energy security, and reduces the pollution that is emitted from non-renewable sources of energy. If you are planning to install a small renewable energy system to make your own electricity, such as a solar electric system or small wind turbine, reducing your electricity loads is the first step—saving you money by allowing you to purchase a smaller system.

However, energy efficiency has proved to be a cost-effective strategy for building economies without necessarily increasing energy consumption.

1.2                                         BACKGROUND OF THE PROJECT

Access to energy is critical to succeeding in modern society, but energy costs can be particularly burdensome for households with low incomes. These households face a higher “energy burden” since they spend a higher percentage of their income on energy bills. Low-income households face a median energy burden that is more than twice that of the median household.1 Spending more on energy means these households have less to spend on non-energy goods and services, which can directly impact their well-being as well as the vitality of a community.

In general, low-income residents live in buildings that are older and less efficient, and use older and less efficient appliances. Both of these lead to higher energy consumption and higher energy bills. While there are bill assistance programs that can help address the immediate burden of high energy bills, the long-term solution is to reduce energy use through efficiency measures. Energy efficiency improvements can help reduce the amount of energy used and energy cost while simultaneously improving the quality of life for residents. Moreover, energy efficiency is an effective way to decrease air pollution from power plants, improve public health, improve grid resilience during periods of peak electricity demand, and create jobs in the building and energy sectors.

1.3                   DEFINITION ENERGY EFFICIENCY PROGRAMME

“Energy efficiency programme is a programme designed to measure the energy used for delivering a given service. Improving energy efficiency means getting more from the energy that we use.”

1. There are different ways to improve energy For example:

• ‘Innovation’ can lead to the equal or greater output with less
• ‘Cutting out wasted energy’ reduces energy needed while maintaining ‘Heating technologies’, such as heat pumps, can deliver greater output for less supplier energy.
• ‘Heating technologies’, such as heat pumps, can deliver greater output for less supplier

2. Through greater energy efficiency we can use less primary fuel or power to enjoy the same level of For example, by improving manufacturing equipment it is possible to produce the same or more with lower overheads. Improved energy efficiency can provide many economic, social and environmental benefits for the UK and yet we are not doing all we can to realise them.

3. Clearly, this is not a new policy agenda. The first energy demand reduction policies were developed by the Department of Energy in 1974 in response to oil shocks and many different approaches have been taken since to improve our energy use efficiency, with some success8. Approaches have changed, as have the ways in which we have used energy, but there has never been a quick fix. So why an Energy Efficiency Strategy now?
4. We must continue to find solutions, such as those provided by the Green Deal and Smart Meters, which allow us to tap into the cost

effective energy efficiency improvements that are right there in front of us; whether it be through more efficient industrial processes, better use of heat, or simply installing energy efficient lighting.

5. Through greater energy efficiency we can use less primary fuel or power to enjoy the same level of For example, by improving manufacturing equipment it is possible to produce the same or more with lower overheads. Improved energy efficiency can provide many economic, social and environmental benefits for the UK and yet we are not doing all we can to realise them.
6. Clearly, this is not a new policy agenda. The first energy demand reduction policies were developed by the Department of Energy in 1974 in response to oil shocks and many different approaches have been taken since to improve our energy use efficiency, with some success8. Approaches have changed, as have the ways in which we have used energy, but there has never been a quick fix.
7. We must continue to find solutions, such as those provided by the Green Deal and Smart Meters, which allow us to tap into the cost effective energy efficiency improvements that are right there in front of us; whether it be through more efficient industrial processes, better use of heat, or simply installing energy efficient

1.4                                                    AIM OF THE PROJECT

The aim of this work is to use energy efficiency programme as an effective way to reduce energy consumption and address energy burden. These programs are particularly beneficial to low-income households, which spend a higher percentage of their income on energy bills.

1.5                                                    SIGNIFICANCE OF THE PROJECT

Energy efficiency programs offer an effective way to reduce energy consumption and address energy burden. These programs are particularly beneficial to low-income households, which spend a higher percentage of their income on energy bills. There are many energy efficiency programs offered by states, cities, and utility companies, but often only a subset of these programs is specifically designed for and directly benefits low-income communities. This fact sheet provides an overview of how energy efficiency programs could benefit low-income communities, and how to design efficiency programs to better serve low-income communities.

1.6                                                    APPLICATION OF THE PROJECT

To help reduce their peak power demands and save money, this utilities programme is introduced to encourage customers to use electricity during off-peak hours. The programs pass on the savings to you, the customer, through rebates or reduced electricity rates. The areas of application of this work or program are as follows:

1. low-income households
2. street lighting
3. aircraft
4. automobiles

1.7                                   THE BENEFITS OF ENERGY EFFICIENCY

1. Economic growth: Installing energy efficiency measures often requires local labour13, and the investment has the potential to boost employment and economic growth. The business community see this as important in the current global economic climate14 .There are also long-term growth benefits. For example, lower domestic energy bills can lead to higher disposable incomes that can be spent elsewhere in the economy, while businesses can see a reduction in running costs and so an increase in productivity. Simple changes in energy use behaviour can deliver some of these benefits with little up-front
2. Longer term investment in energy efficiency technology can also lead to a virtuous circle as innovation leads to cost reductions which can make it cheaper and easier to invest in energy efficiency in the future. Developing our innovative capacity in technology, materials or business models for energy efficiency opens up the potential for increasingly significant export opportunities for the UK as the global effort to combat climate change ramps
3. Economic studies show that improved energy efficiency can bolster productivity, increasing growth and reducing A study of the Government’s energy efficiency policy between 2000-2007 estimated that these policies increased the annual rate of economic growth by around 0.1 percentage points within that period17.The study also estimated that these policies resulted in roughly 270,000 additional jobs in 2010 owing to the cumulative impact of higher growth.
4. Savings for domestic and business consumers:

Wellbeing can also be enhanced through increased energy efficiency. For example, a higher disposable income, as a result of lower energy bills, can allow increased spending on other necessities. In addition, the health benefits from properly installed energy efficiency measures can be significant.

5. Some of the financial savings from energy efficiency measures may be spent on energy consuming goods and services: the rebound effect. This means that the overall impact on energy consumption is smaller, although consumers may feel a benefit from the additional energy consumption. The nature of rebound effect will vary depending on the energy efficiency measures adopted. For example if someone increases the level of insulation in their property, the direct rebound effect would be an increase in the temperature to which the house is heated and an indirect rebound effect would be using the savings on heating bills to buy an additional It is possible that the direct rebound effect might be reduced through providing advice when energy efficiency measures are installed.
6. Energy efficiency is also one of the central pillars of the Government’s efforts to tackle fuel poverty. Improving the energy efficiency of the home is often the most cost-effective way of making a sustained reduction in household heating costs and removing that household from fuel
7. Emission reductions: To deliver against our greenhouse gas emission targets over the coming decades in the most cost effective way, we need energy efficiency to improve significantly across all

1.8                                                  SCOPE OF THE PROJECT

The Nigeria now has a huge opportunity to optimize the energy use of domestic and business customers, reducing bills and/or warming homes, while at the same time, delivering a more sustainable society. Individuals can do this through taking action to reduce their demand, such as turning off energy using products that are not in use, buying products that are more efficient or installing energy efficiency measures in their homes. Businesses can take similar actions, reducing their long term operating costs.

This work identifies four overarching barriers to greater energy efficiency that have to be overcome. Action is already being taken, but if we further pursue these barriers we will be able develop a stronger, self sustaining energy efficiency market and more consumers will be able to see a return, creating positive reinforcement of the potential of energy efficiency. The four corresponding ‘barrier annexes’ to this strategy5 outline those policies that are already in place to tackle these issues and provide case studies where public and private sector organizations have already been successful in achieving greater energy efficiency, realizing the associated benefits.

Considered in this way, energy efficiency can play a major role in the Nigeria’s balancing of energy demand and supply.

summary of additional actions we are taking alongside this strategy in order to help stimulate a self sustaining energy efficiency market. These actions and others across the broad energy efficiency spectrum are covered in more detail within the barrier annexes.