The Role of Residential Energy Efficiency as a Growth, Welfare and System Enhancing Economic Activity

The role of energy efficiency in reducing household energy efficiency and emissions has long been recognised and promoted within in and across nations as a key demand-side measure in reducing energy use and associated emissions. However, it can also play a key role in stimulating sustained economic growth in ways that both enhance welfare - by reducing the cost-of-living and fuel poverty in more energy efficient households - and the sustainability of the wider economic and energy systems - by stimulating growth without additional pressure on constrained energy supply systems.

This brief reviews CEP’s portfolio of research on how residential energy efficiency actions impact the wider economy to deliver such outcomes. We do so with particular focus on how the fundamentals and mechanics identified in our work could be expected to impact in the current UK economic landscape characterised by cost-of-living and energy resilience challenges combined with opportunities for new domestic supply chain development.