In the UK, political battle lines over soaring energy prices and the desperate need to tackle climate change are drawn.
Average consumer energy bills increased by 54% in April 2022, then by a further 27% in October last year: A consequence of post-Covid demand and supply constraints, Vladimir Putin’s illegal war in Ukraine (forcing Russian oil and gas from Europe), and, allegedly, canny profiteering by some suppliers.
It’s a grim reality that has pushed hundreds of thousands more families into fuel poverty—which stymies wider economic activity.
Consequently, energy supply, pricing and security have soared up the political agenda. Parliamentarians have belatedly started a discussion about a mass switch to cleaner energy that will improve supply and help the UK meet its target of “net zero” carbon emissions by 2050.
“When global energy supplies are disrupted and weaponized by the likes of Putin, we have seen household bills soar and economic growth slow,” Britain’s prime minister, Rishi Sunak, told a conference in March 2023.
“We are stepping up to power Britain and ensure our energy security in the long term, with more affordable, clean energy from Britain, so we can drive down energy prices and grow our economy.”
Sunak’s biggest political opponent, Labour Party leader Sir Keir Starmer, delivered a similar speech in June. “Climate change and energy security now threaten the stability of nations,” he warned.
Subsequent talk has been of weaning the UK off its addiction to fossil fuels towards lower-carbon alternatives such as electric vehicles, wind and solar power, heat pump-based heating systems, and hydrogen gas.
But that requires effective public policy. And the reality of Britain’s pivot to clean energy so far has been a slow, disjointed and barely coordinated mess of policies that have favored the wealthy at the expense of people on middle and lower incomes.
The government’s flagship de-carbonization plan, the Heat and Buildings Strategy, even failed to include an equality assessment. Ministers didn’t fully consider the impact on vulnerable communities—exacerbating existing inequalities. In a UK still rife with class divides, it even shows in our energy policy.
Why? Largely because switching to cleaner, low-carbon energy and transport networks requires a high upfront investment. So, the average household—already facing soaring food bills, inflation and mortgages—can’t afford to “green” their cars and homes in ways that wealthier families can.
Of course, such divides between “haves” and “have nots” are not new. It stands to reason that wealthier families will more easily afford to adapt lifestyles. But the entire world is invested in tackling global warming. So, any scenario whereby those on higher incomes can deliver their end of the bargain, while those on lower incomes cannot afford to, is not going to create the critical mass of low-carbon households the planet needs.
The trade union Unison, which represents 1.3 million UK workers, published a report in June, exposing how the high upfront cost of clean energy discourages families from switching despite a complex patchwork of existing state incentives.
For full transparency, I should declare that I assisted Unison with its research.
Why is a trade union so interested in clean energy?
Well, there are tens of thousands of potential new jobs across the burgeoning sector—meaning potential new union members. Unison also wants to protect existing staff across fossil fuel-based industries by ensuring that companies and governments support retraining and adapt the methane gas sector, for example, to prepare for lower-carbon alternatives such as hydrogen.
Yet UK progress has been painfully slow. A recent report by the Climate Change Committee (CCC), the government’s independent advisers, warned there was “scant evidence” of delivery against targets. And the UK lags behind comparable economies—such as Germany, France and Spain—on key indicators.
According to Gridlock, Unison’s study, there is a “drastic need for better central government policy and improved support for lower-income households”.
Take electric vehicles (EVs), for example. It is hard to find a new family-sized EV, with a good battery range, on the market for less than £28,000. That’s more than the UK’s average annual wage.
In October 2022, a new electric Peugeot 208 cost around £30,000 compared with under £20,000 for the petrol version. Meanwhile, the price of some electric SUVs start at £50,000: More than the cost of many two-bedroom homes in Stoke-on-Trent!
Is it any wonder, therefore, that at the end of September 2022, just 2.5% of all UK-licensed road vehicles were plug-ins?
When it comes to heating systems, too, the UK government has for years offered insufficient incentives—including grants and loans—to get households to switch.
For example, the state offers grants of up to £6,000 for air or ground-source heat pumps as an alternative to the gas boilers banned from new housing after 2025. But the average cost of a heat pump system is around £15,000-£20,000. With the current cost-of-living crisis showing few signs of abating, it’s safe to say most families are not switching.
It’s a similar situation with solar. According to a report in The Guardian in March 2023, a solar energy system that features a 4kW array of panels plus a high-quality home battery costs around £11,000-£13,000. Households would typically recoup that after seven years. But data from the Microgeneration Certification Scheme shows just 4% of the UK’s 29 million homes have solar installations.
If the UK is serious about meeting its net zero commitment, and insulating itself from volatile oil and gas prices caused by geopolitics, it cannot only rely on its wealthier classes. By definition, most families earn medium or lower incomes. And they produce lots of carbon.
It is time for UK politicians to stop talking about the pivot to clean energy,and to start putting the state’s money where their mouths are. Which means better incentives, grants, loans, and support. The future of the planet depends on it.
As Christina McAnea, Unison’s general secretary, has warned: ‘Ministers must get to grips with this problem now, not in years to come when it’s too late.’