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Miliband's blueprint for greener homes

The Government has made its target to cut carbon dioxide emissions more ambitious, and the new Energy and Climate Change Secretary is examining incentives to help us meet it, reports Geoffrey Lean

Ed Miliband, the new Secretary of State for Energy and Climate Change, is drawing up plans for a "big shift" in the way Britons heat and power their homes, The Independent on Sunday can reveal.

The plans – which are scheduled to be published at the end of next month – are expected to include tough targets for cutting energy use in the country's 26 million homes, notoriously the worst insulated in Europe, and generous incentives to make it easy for householders to meet them.

The drive has the full backing of the Prime Minister, who has decided that promoting energy saving should be a top priority for the Government because it will create employment, save families money as fuel prices rise, combat climate change and make it easier for Britain to achieve energy security.

Yesterday Mr Miliband, who is already shaking up his department's priorities in order to place much more emphasis on reducing demand for fuel, told the IoS: "Over time we need a big shift in the way we use and conserve energy and the Government must play a part in making this happen."

Senior officials will present him with the first draft of the plans on Wednesday, in the middle of the Government's official Energy Saving Week. They will focus on reducing energy wastage from Britain's housing stock, which is responsible for 27 per cent of the entire country's emissions of carbon dioxide.

Ministers have already laid down an ambitious programme for new housing, which requires all new homes to meet strict zero-carbon standards by 2016. But this only scratches the surface of the problem, which arises overwhelmingly from the leaky state of the country's s existing homes.

Last week Mr Miliband accepted a recommendation from the official Committee on Climate Change to increase Britain's target for reducing carbon dioxide emissions from 60 to 80 per cent by 2050.

But if the country is to have any chance of meeting this – the most radical commitment so far made by any nation in the world – it will have dramatically to improve the energy efficiency of existing homes, since 85 per cent of them are expected still to be in use by the middle of the century.

Gordon Brown took the first step towards achieving this last month by making cavity wall and loft insulation available half-price to every household – and free to the poor and to pensioners. Firms report a sharp increase in demand as a result. But he, and Mr Miliband, realise that further measures will be needed.

Among the initiatives that the new Energy Secretary is expected to adopt are:

Targets for reducing the amount of carbon dioxide emitted from British homes. Last week a report by the UK Green Building Council (UKGBC), partly funded by the Government, called for this to be "at least 80 per cent" by 2050. And it added that "interim targets" should be set for every five years between now and mid century, to ensure that the policy stays on track. The report says that "the scale of this challenge is somewhat daunting", but that there was a "consensus" that "it can be done", provided policies change. Certainly no lesser target has a chance of doing the job.

New ways to enable people to fund the improvements needed to make their homes energy efficient. Most energy-saving measures more than pay for themselves over time, but most families still find it hard to find the initial sum of money needed to buy equipment and install it.

The UKGBC report suggests that the Government, banks or the energy companies should offer 100 per cent, interest-free loans that could be repaid through local taxes, the energy bill or the mortgage. One imaginative idea is that householders should pay back a proportion of the money they actually save on fuel bills from making the improvement, keeping the rest as an incentive. But the loan would have to be tied to the property not the individual, staying in place when a home changed hands.

Other financial incentives could include reducing the rate of VAT charged on home improvements and offering rebates of council tax, income tax or stamp duty to owners of energy efficient homes.

Much better advice and information to householders on how to make their homes more energy efficient. A wide consultation by the UKGBC found that the most important obstacles to them taking action are "a lack of knowledge about what can be done to upgrade a home, and confusion about where to find reliable advice, installers and information".

This might be best achieved through a "whole home energy plan", which lays out how to make it energy efficient, what measures should be made when, how to get the money needed and how to ensure aftercare. There would also need to be some scheme for formally accrediting installers.

A drive to train builders and tradesmen to enable them to carry out green refurbishment projects, often at the same time as they are doing other building work on the property. The improvement of the energy efficiency of British homes is potentially a huge source of income and employment: the UKGBC report calls it an "enormous business opportunity", worth an estimated £3.5bn-£6.5bn a year, and likely to create "tens of thousands of new 'green-collar' jobs".

Experts believe Mr Miliband is shaking up the notoriously conservative official attitude to energy, which has placed a low priority on efficiency. He is seen as a great improvement on his predecessor, the arch-Blairite John Hutton, who was particularly focused on building new nuclear and coal-fired power stations. Paul King, the UKGBC's chief executive, said: "Ed Miliband's first few days have shown that he is determined to push the agenda forward. I believe he will be looking to set bold targets for existing houses."

Downing Street said Gordon Brown regards energy conservation as "a very high priority" not least because it will provide much-needed jobs and enable people to keep fuel bills down.

But the Conservative Party seemed to have missed the point – and let its green positioning slip – last week when Chris Grayling, the shadow Work and Pensions Secretary, said the Prime Minister's interest in creating jobs through energy efficiency measures shows "how out of touch he is with what is going on in the real economy".

EU moves to toughen law on insulation

Families that extend their homes will be forced to insulate their whole houses under new plans being drawn up by the European Commission, confidential documents reveal. The documents, seen by 'The Independent on Sunday', detail proposals for toughening European energy conservation laws. They will be put before commissioners next month.

The measure will embarrass ministers because it will make them do something that the Government had itself proposed and then abandoned. Shortly before the last general election, it put out a consultation document on the proposal – but dropped the idea despite an overwhelmingly favourable response. It then promised another consultation, but this never materialised.

The thinking behind the proposal is that when a home is extended it increases its carbon footprint, and that work should be carried out to reduce it instead.

Up to now, the EU has required this only when buildings with a total floor area of more than 1,000 square metres are extended. The new measure will apply to all buildings, including private homes, when the extension is equivalent to more than a quarter of their size or value. The EC officials who have drawn up the proposal believe it will lead to €25bn in energy savings by 2020 and provide tens of thousands of jobs.

Andrew Warren, director of the Association for the Conservation of Energy, said: "This would be one of the biggest breakthroughs for years in reducing the amount of energy used in homes and other buildings. It will make an important contribution to fighting climate change and create a lot of new jobs in the construction industry."

Geoffrey Lean

10 ways to a more energy-efficient house

Eco hat

A rooftop gadget that uses warm air rising through the house to heat domestic water or re-circulate it through the home. Some types act as an internal chimney, capturing some of the heat from extracted air to be reused to heat incoming air.

Ground source (or geothermal) heat pump

This works by extracting heat from the ground and consists of a length of pipe containing water and antifreeze which is pumped around, absorbing the heat. The pump can cost from £6,000 to £12,000 but is able to generate £1,000 worth of electricity a year.

Air source heat pump

This exchanges heat with the air rather than the ground. A system costs about £7,500 but can produce £750 worth of energy a year. Grants are available from the Government's Low Carbon Buildings Programme for eco heat pumps and other green technologies such as solar, wind and hydro power.

Hydro turbine

People with streams or rivers on their property can use a hydro turbine, the most efficient of the renewable energy technologies. Up to 90 per cent of the water's energy can be converted to electricity. A small hydro turbine can cost between £4,000 and £10,000 depending on size.

Energy meter

A Wattson energy meter displays your energy consumption at any given time in terms of pounds per year for that level of consumption. This allows you to track just how much you are using and prevent catch-up bills from energy companies that may have previously billed on estimated usage.

Triple-glazed window

Double-glazing has been superseded by triple-glazed windows, with cavities filled with argon gas, which is a better insulator than air. Commonly used in Canada and Scandinavian countries, they are more efficient than traditional double-glazed windows.

Biomass burning boiler

These burn pellets made from compressed waste sawdust to heat water and provide central heating. They cost from £5,000 to £10,000 to install. But a typical system can produce up to £1,000 worth of energy a year and saves six tons of carbon dioxide compared to a traditional boiler.

Underfloor heating

Usually powered by ground source heat pumps, underfloor heating is more energy efficient than radiators. Because the floor has a larger space than a standard radiator, the water can be heated to a lower temperature than usual.

Solar-powered charger

For about £30 you can get a portable solar-powered charger to keep mobile phones, satnav units, laptops and other electronic gadgets fully charged.

Wind turbine

By installing a wind turbine on your roof, you can meet some of your energy needs. Although it can cost from £1,500 to £5,000, grants and long-term savings make this a viable option.

Jonathan Owen

and what you should be doing already

Using energy-efficient lightbulbs

Turning down your thermostat by at least 1C

Switching to a green energy supplier

Making sure your home – including potentially wasteful areas such as the loft space – is well insulated

Turning off appliances such as computers and televisions when they not in use, rather than leaving them on standby

Using energy-efficient washing machines and fridge-freezers

Getting a free Home Energy check by logging on to www.energy savingtrust.org.uk