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The energy hierarchy

Energy policy statement 09/03

The Institution believes that the UK needs a basic guiding framework for energy policy which is simple to understand and outlines the core principles on which an effective, sustainable energy policy should be based. The Energy Hierarchy has five priorities, seeking to reduce energy use before meeting remaining demand by the cleanest means possible.

Priority 1 – Energy conservation; the reduction or elimination of unnecessary energy use. Conservation is often achieved through behavioural changes such as switching appliances off when they are not being used. Engineering solutions such as smart meters and real-time displays all have an important role to play here.

Priority 2 – Energy efficiency. Efficiency improvements, ranging from improving the efficiency of a television through to that of a coal-fired power station, are usually achieved through the application of engineering principles. Combined Heat and Power systems fall into this category.

Priority 3 – Exploitation of renewable, sustainable resources. As well as resource availability, effective and sustainable energy provision must also embrace wider issues such as affordability, societal acceptability and environmental impact.

Priority 4 – Exploitation of non-sustainable resources using low-carbon technologies. In the UK we are so reliant upon finite natural resources such as oil, coal, gas and uranium that a transition to a fully renewable energy system will take time. In the interim, it would be prudent to make these more efficient and less damaging to the environment. Examples of this include reducing the legacy waste impacts of nuclear power and carbon capture and storage.

Priority 5 – Exploitation of conventional resources as we do now. Fossil fuels are so locked into current energy systems that efforts will continue to be made to perpetuate the current approach. Oil companies look for new sources of oil and gas. Developing nations naturally favour cheap, proven, reliable sources of new energy. While these approaches may be understandable from an economic perspective, they have unsustainable local and global impacts, hence their lowly position in the Energy Hierarchy.

Key recommendations

The Energy Hierarchy offers an effective framework to guide energy policy and decision making. By prioritising demand-side activities to reduce wastage and improve efficiency, the Hierarchy links closely to the principles of sustainable development and offers an integrated, easy to use approach to the management of energy demand and supply. Put simply, a common-sense, cost-effective, sustainable energy policy should aim to reduce energy use before seeking to meet remaining demand by the cleanest means possible.

The Institution believes that the UK’s energy policy should:

  • Be developed with the Energy Hierarchy as its framework;
  • Include a statutory national target on energy conservation in support of the EU primary energy savings commitment of over 20% below projected business-as-usual levels by 2020;
  • Urgently provide a long-term framework giving investment signals for businesses to deliver major energy system change. Consumers, industry, commerce and Government should be rewarded for becoming ‘part of the solution’.

    Download the full policy statement.

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