Industry Agrees to 11% Energy Efficiency Improvements

by | Apr 9, 2013

A total of 51 industrial sectors in the UK, including steel, aerospace and farming have agreed to more ambitious energy efficiency improvement targets by 2020 as part of the voluntary Climate Change Agreements scheme.

The new commitments will deliver an overall 11 percent energy efficiency improvement across all industry sectors by the end of the decade against agreed baselines, according to the UK’s Department of Energy and Climate Change. Sector targets will be reviewed in 2016, the government agency said. The UK’s Environment Agency will administer the new scheme.

The Climate Change Agreement scheme, which began earlier this month, provides an extension to the Climate Change Levy rebate for energy intensive industries until 2023 in return for meeting the new targets.

If all 51 industrial sectors meet their targets from 2013 to 2020, carbon dioxide emissions would be reduced by 19 million metric tons and primary energy consumption would fall by about 100 TWh, the UK government agency said.

Eligible sectors can receive up to 90 percent reduction in the Climate Change Levy if they sign up for the voluntary energy efficiency improvement targets. Participants in the program also would save an estimated £300 million ($458 million) each year on the Climate Change Levy. The agency warned the estimated savings doesn’t take into account the mineralogical and metallurgical industries’ exemption from the Climate Change Levy announced in the budget last month.

The UK’s Energy Bill, which went into effect last November, allows energy companies to increase the levy for low-carbon electricity from £2.35 billion in 2012-13 to £7.6 billion in in 2020-21. Thee government is considering exemptions for some energy intensive industries from energy-cost increases arising from new subsidies for wind farms, nuclear power stations and other forms of low-carbon energy. The Energy Bill, intended to move the UK to a “low-carbon economy,” will cost £110 billion over 10 years.

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