Renewable Home Energy Amidst Rising Energy Prices - Viva Training Centre

Consumers in the United Kingdom are facing an unprecedented increase in energy prices. In a country where people felt protected by price caps on gas bills, the sudden increase in gas price is a result of the decision by regulator Ofgem to raise the cap to £1,971.

It’s terrible news for consumers who will face a 54% increase in the price when new caps are rolled out in April 2022. This simply means that the cost of the gas bill for an average household in the UK will skyrocket from £1,277 to £1,971 per year.

According to Ofgem, the energy regulator, nearly 22 million customers will be impacted by the increase. Even worse, customers on fixed rates will also feel the burden once their deal ends.

Amid the turmoil in the energy sector and the adverse situation in Ukraine, experts believe that prices may not stall at this level. Instead, energy bills can spike up beyond £3,000 by the year-end. For instance, analysts at Cornwall Insight suggest that the average dual-fuel bill will rise by £2,900 a year once the next price cap is introduced in October. A few others assert that the price will increase even more.

It isn’t an exaggeration because some companies such as Scottish Power are already quoting record-breaking Fixed Price tariffs hovering around £3,500. Under the circumstances, the newly introduced tariff by Scottish Power doesn’t look that bad.

Why the Bombshell

The massive increase in energy prices seemed imminent for a long time. While it’s true that prices around the world have increased abruptly, the United Kingdom has its own sets of problems that led to the crisis.

On a domestic level, there is an acute shortage of gas storage facilities, which means that the country is ill-equipped to fulfil the demand in difficult times. For the last two years, the problem continued to exacerbate as a result of the exceedingly cold winters and a relatively windless summer. Such weather patterns led to a rise in gas demand at a time when wind energy couldn’t offer any relief either.

From a global perspective, the gas shortage may continue to affect consumers in Europe because rising economic powers in Asia, especially China, are increasingly taking a lion’s share of global gas supplies.

Recently, the situation became dire following the invasion of Ukraine by Russia. As the largest exporter of gas to the world, the UK may not receive gas from Russia anytime soon. Although the UK doesn’t receive a lot of gas from Russia, disruption of gas supply to Europe certainly impacts prices in the UK.

How Renewables Can Reduce Energy Bills

If nothing is done to offload the burden on power plants, there is little doubt that energy prices will continue to rise in the future. However, consumers who are willing to transition to renewable energy sources can save a significant amount on their bills.

Installing energy-efficient appliances and improving home insulations are just a few ways that can help reduce rising bills. Government incentive schemes for green energy can further decrease the price. Together, this combination offers a powerful formula to cut energy bills to more than half.

Before looking at some highly cost-effective methods that homeowners can use to cut their energy bills, here is a brief overview of different types of green energy grants offered by the government. Using these grants can add to savings.

  • Boiler Upgrade Scheme: The boiler upgrade scheme helps homeowners receive upfront capital to install heat pumps and biomass boilers.
  • Feed-in Tariffs: The scheme is available to anyone who has installed a solar panel, wind, hydro, and similar plant up to a capacity of 5MW, or 2kW for CHP. Homeowners can save a substantial amount on energy bills by getting credit for exporting access energy to the grid.
  • Northern Ireland Renewable Obligation Certificates: Similar in scope to the Feed-in Tariffs, these certificates are used in Northern Ireland to offset energy bills.

Of course, these are not the only programs on offer but they should give readers some idea regarding saving opportunities. Besides these, there are often a variety of additional incentives that are specific to the area. It also makes sense to check with local energy suppliers as some companies actively participate in green programs that help their clients receive energy credits.

How Much Can You Save

Experts estimate that installing energy-efficient appliances and adding insulation can have a significant positive impact on energy bills. Already, an average British household using renewable home energy saves approximately £1,000 each year. This is mainly due to the installation of smart appliances such as energy-efficient fridges, bulbs, and washing machines.

Research by Energy Saving Trust also shows that three simple changes to energy consumption can save consumers around £100 per year. These include turning the thermostat by one degree, changing all the lightbulbs to LED, and turning appliances off instead of keeping them on standby. In numerical terms, it means that if everyone in Britain follows these three steps, it will correspond to taking 3 million cars off the street.

Besides saving energy expenses, renewable energy indirectly helps tackle climate change. For instance, a typical UK household using renewable sources often saves 667kg per year of carbon emissions. In easy words, this translates into saving carbon emissions equivalent to nearly 60% of the annual distance covered by an average UK driver.

Seven Ways To Reduce Energy Bills

Anyone can save hundreds of pounds on energy bills without taking drastic measures. Even simple things such as switching off the power instead of keeping appliances in standby mode can make a difference. In the end, little changes will add up very quickly providing relief from the pressure of rising energy costs.

Here are a few practical methods to consider:

Use Energy Efficient appliances

While everyone knows that buying energy-efficient appliances can help reduce the bill, people seldom buy such appliances just for the sake of reducing their energy costs. As a result, they seldom notice any difference in energy costs.

To get the most out of a home appliance, it’s important to remember that appliances are rated between A and G based on how much energy they save. The most energy-efficient appliance is rated A or A+++. The rating scale usually ranges between A to G where G is rated least efficient. Buying an A-rated appliance can save us between 40% and 50% on bills compared to traditional appliances.

For more information about these ratings, check the Label 2020 website before making a decision.

Get a Heating Control System

For most households in the UK, heat and hot water take up the largest chunk of energy costs, which often constitute half the entire bill. Converting a heating unit into an energy-efficient system is easier than most people think. It just requires installing a room thermostat, a programmer or a thermostatic radiator valve.

The underlying control mechanism will ensure that household members only use the amount needed to heat the house. The system automatically turns off to save heat and operates at specific intervals. Installing or upgrading a heat control unit can save £85 per year on average without any additional expense.

Improve Home Insulation

A lot of individuals don’t realize the importance of insulating their homes. Theoretically, one-third of the heat loss occurs due to poor insulation. This is particularly true for old homes that don’t have any type of insulation to reduce heat loss.

If possible, start by insulating hot water pipes and hot water cylinders. Once done, check if the loft is properly insulated. Likewise, it’s also a good idea to add insulation to the bottom floor.

For added benefit, consider insulating doors, windows, and walls. To trap heat inside, use double or triple-glazed windows or add insulation between the window frame. If done properly, it increases energy efficiency between 20% to 30% because less heat will pass through enabling the heating system to consume less power.

Generate Your Own Electricity

If cash is available upfront, there is no better way to save on energy bills than installing a solar power system. Besides decreasing the expense, it allows the user to export any excess energy to the grid. Enrolling in the Smart Export Guarantee program will give additional credits for exporting electricity that the system generates.

On average, consumers can save anywhere between £340 and £360 per year using this method. Solar panels are not the only solution. These days, it is also practical to install small-scale wind turbines in rural areas. The government is always keen to promote green initiatives; therefore, it’s easy to find some kind of financial incentive that will likely offset the cost of such installations.

Upgrade to a Heat Pump

Heat pumps use electric power to heat homes. They extract heat from the cold outside air and distribute it efficiently inside every room. During the summer months, heat pumps can alter the role by transferring warm indoor air to the outside keeping homes cool throughout warm months.

Heat pumps are very effective because they provide three times the amount of heat for every unit of electricity consumed. When ready, use the Boiler Upgrade Scheme to install heat pumps. The government scheme allows residents of England and Wales to get upfront capital of up to £5000 to install heat pumps and biomass boilers.

Apply For Energy Efficiency Grants

Over the years, the government has introduced various grants to help people pay their energy bills. Pensioners and certain other individuals can get a discount of £140 under the Warm Home Discount Scheme. Senior citizens born before 26 September 1955 are also eligible for a discount between £100 and £300.

The local energy supplier may also have additional grants available for smart appliances. Perhaps, this is a good time to check for such incentives by visiting the official website or by calling the energy company. Certain suppliers can also provide financial incentives to insulate homes. If an old scheme is being phased out, the government is likely to introduce a new scheme. Therefore, be on the lookout for such grants.

The Verdict

Saving energy is not only about upgrading appliances, adding insulation, and getting incentives only. Instead, little things such as replacing light bulbs, using electric heaters, installing smart thermostats, and adding draught-proof strips on entryways can have a major impact on the bill.

Take the first step by installing a smart meter. It lets homeowners review how much energy they’re using in real-time and how much does it costs. Use the information to work out the expense and where to save.

Remember, small steps will lead to big energy savings.


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