The latest views from the energy efficiency sector: confidence is up, but order values are down
Here at the Hub, we always keep an eye on the quarterly energy efficiency reports produced by EEVS and BloombergNEF.
And for good reason; the data guides businesses both on futurist trends, and the day to day context of the UK’s transition to a low carbon economy through energy efficiency.
With all this in mind, what happened in Q4 2018?
The report detailing the industry at the end of last year is largely upbeat. The authors reveal that despite the ongoing Brexit debate, energy efficiency suppliers reported strong levels of confidence.
This appeared to be partly down to growth in overseas orders which, until now, have barely registered a murmur within the survey; this is a noteworthy shift for a sector that has been largely UK focused to date.
But, more negatively, the typical financial value of energy efficiency work that’s going ahead appears to be falling. The authors attribute this to a Brexit slowdown effect; a similar trend has been noted in many wider sectors of the UK economy.
What else is the energy efficiency sector saying?
On government, negative attitudes toward energy efficiency policy have strengthened; 53% of respondents reported the government’s approach to be ineffective or very ineffective.
Further, low levels of confidence were felt in relation to the wider economy. The slight increase in support for government action in the previous quarter has been lost with only 19% of suppliers considering the government’s management of the economy to be effective.
On technology, high efficiency lighting continues to lead as the most popular tech. Building Energy Management Systems (BEMS) faced a sharp decline however, with a material reduction in projects being commissioned by efficiency consumers this quarter.
Interest in behavioural change schemes increased, which perhaps points to lower cost options as more favourable given aforementioned uncertainties around Brexit.
Payback times remain the same, with most customers expecting energy efficiency to pay back with three to five years.
Hope springs eternal?
Right now is a pivotal time for the Brexit negotiations, which makes life complicated for business across all sectors, according to the report authors. But there may be hope for energy efficiency from another source.
Philip Hammond has used his Spring Statement to unveil fresh low carbon and energy efficiency measures, building on commitments made in the Clean Growth Strategy.
It may be the energy efficiency sector stands to gain from this revamping of green policy, which could potentially help boost business.
The impact of the latest green announcements will make for interesting reading in the next EEVS/BloombergNEF report, when we may finally know not only the true outcome of Brexit, but whether Philip Hammond’s Statement boosted commercial energy efficiency in 2019.
Read our lowdown on the Spring Statement’s energy announcements.