The U.K. Economy Is Growing — But Its Energy Use Is Shrinking

Nov 23, 2018
Originally published on November 23, 2018 3:13 pm

Updated at 3:13 p.m. ET on Friday

In the global fight against climate change, the United Kingdom has quietly notched an unusual — and somewhat mystifying — victory.

For well over a decade, the country's total energy consumption has dropped steadily. All told, there's been a 10 percent decline since 2002, after accounting for temperature variation.

The trend is widespread, documented in the residential, commercial and industrial sectors (though not, notably, in transportation). It's not tied to economic decline or supply shortages.

It's also significant: The reduction in electricity use over the last decade is equivalent to shutting down the country's largest coal- and biomass-burning power plant twice over, according to the climate policy think tank Sandbag.

And it's unusual.

Many countries saw a dip in energy consumption during the Great Recession, but the U.K.'s dropping demand began before the crash, and has continued afterward. Other EU countries have not matched the drop; neither has the U.S., where some sectors have seen reductions in demand, but overall energy use has generally held steady.

"It's a huge, quiet success story," says Guy Newey, the director of strategy and performance at Energy Systems Catapult, which promotes innovation in the energy sector. He previously worked in the British government as an energy and climate adviser.

He says it's particularly promising that the U.K.'s decline in energy consumption has continued even as its gross domestic product has risen.

"You would normally, or traditionally, expect GDP rise to be accompanied by an energy consumption rise," he says. "That's what you tend to see on a global level. ... As people become richer, they tend to buy more stuff, use more stuff and consume more energy."

But in the U.K., that link has been broken.

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"The interesting question, for a wider global energy policy, is: 'Can that example be replicated?' " Newey says.

Hypothetically, the U.K. could provide a model for other countries hoping to reduce their energy use — cutting greenhouse gas emissions — while maintaining economic growth, he says.

'It's a bit of a mystery'

But it would be easier to replicate if analysts could pinpoint precisely why it's happening.

"Overall, it's a bit of a mystery," says Phil MacDonald, the acting managing director of Sandbag, the climate change think tank. Take the drop in electricity demand.

The U.K.'s electricity use dropped 2 percent last year, while no other country in the EU saw a decline, Sandbag found. And that drop in Britain is part of a decade-long trend.

Why? The British economy isn't shrinking. The population is not declining. It can't be the weather: Neighboring countries with similar recent weather patterns aren't following suit. Ireland, for instance, is using about the same amount of overall energy as it did in 2004 — and its electricity use has risen.

It's not skyrocketing prices, either. Analysts say British households today have, on average, similar or lower total energy costs than they had 10 years ago.

A shift away from energy-intensive heavy industry — like steel manufacturing — does account for a portion of the change, but not all of it.

LED lightbulbs and more energy efficient appliances are also contributing, but standards for lightbulbs and appliances are generally set across the EU, not just in the U.K.

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But analysts can point to a few specific factors.

For reduced natural gas use, "probably the least sexy but most important change has been a quite dramatic tightening of standards for gas boilers," Newey says. "That has been probably one of the most successful climate policies of the last 15 to 20 years."

For electricity, MacDonald points to a push for more efficient lightbulbs in street lamps. And shifts in consumer patterns — turning off lights and dialing back thermostats — might also play a role that's hard to quantify.

But those elements, taken together, still don't seem to add up to a full explanation.

"It's not perfectly understood exactly what's happening," Newey says.

An untold story

Efforts to tackle climate change often emphasize new, greener energy sources. But experts have long argued that it's just as important — if not even more important — to cut down on how much energy we use.

"Reducing demand should be the primary thing you do," says Jonathan Marshall, the head of analysis at a think tank called Energy and Climate Intelligence Unit. "It should be the lowest-hanging fruit."

The U.K.'s success in reducing demand has not been broadly boasted about, either by the British government or climate change activists.

There are several possible reasons why. For one thing, it's not a very sexy achievement.

"It's a lot easier to get excited about electric vehicles and wind turbines than it is about insulation," Marshall says.

And not all drops in demand are good, as Newey notes. "If you are really struggling with your energy bills and you sit in a cold, damp house, and it gives you health problems, that will show up as reduced energy demand. That's not a desirable social outcome."

That might make politicians wary of highlighting drops in demand — even though the U.K.'s drop is not tied to a recession.

Can it continue?

One key question, analysts agree, is whether the drop can be sustained over time.

In the industrial sphere, researcher Jahedul Islam Chowdhury has surveyed companies and found some aren't investing in clean tech simply because "they don't care about climate change," he says.

"They said that, 'Frankly, this is not our business,' " he says, paraphrasing the companies' reactions.

But there's some reason for optimism, as overall energy use is decreasing anyway. Government policies that offered financial incentives could inspire more companies to change course, Chowdhury argues — and he calculates industrial energy use could drop by a further 15 percent without changing output at all.

It's a similar story in the residential sector. British homes have been using less and less energy without meaningful government intervention.

"There isn't really a particularly strong energy efficiency policy in the U.K. at the moment," Marshall says. The most recent push to weatherize homes was widely regarded as a failure. That suggests a renewed initiative could bring fresh reductions in demand.

There are some parallels with trends in the U.S., where per capita electricity use has been dropping. It's not as dramatic a decline as the British have achieved, but it's similarly happened quietly, without widespread attention.

Ellen Bell, who works for the Environmental Defense Fund on its clean energy program in the U.S., says to her, this just highlights how much possibility remains in the future.

"Things are happening without people even realizing it," Bell says. "Imagine what we could do if we just drew the attention we needed."

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We're now going to shift over to the United Kingdom, where energy use has been dropping over the past 15 years. But it's been a quiet victory and a mysterious one, as NPR's Camila Domonoske reports.

CAMILA DOMONOSKE, BYLINE: British electricity use dropped so much over the last decade that it's as if the U.K. shut down its largest coal power plant twice. That's according to the climate policy think tank Sandbag. And it's not just electricity. The country's total energy consumption of all kinds has dropped 10 percent since 2002.

GUY NEWEY: And that's kind of unusual, actually.

DOMONOSKE: Guy Newey used to be a climate adviser in the British government. Now he works at Energy Systems Catapult, which promotes energy innovation. I asked him why this is happening. Are there just fewer people?

NEWEY: Nope, it's the opposite. The U.K. has had an increasing population.

DOMONOSKE: A slowing economy uses less power. Is the British economy struggling?

NEWEY: Our overall GDP has increased.

DOMONOSKE: It's not tied to skyrocketing costs, and it's not the weather. The decline remains if you factor in temperature. And the U.K. is seeing a drop, while Ireland, right next door, is not. In fact, last year, the U.K. was the only country in the EU to see a drop in electricity use. I asked Newey, is it something special about British people? - stoicism, self-restraint.

NEWEY: I mean, you know, we're quite reserved. But that's always been the case. I don't think that's increased or decreased over the last 10 years (laughter).

DOMONOSKE: So what is going on?

NEWEY: The first thing I'd say is it's not perfectly understood exactly what is happening.

DOMONOSKE: Analysts do know some of the factors, but even those can be a little confusing. Consider energy efficiency.

JONATHAN MARSHALL: We're getting better insulated homes and better insulated office buildings, more efficient televisions, computers, fridges, freezers, that sort of thing.

DOMONOSKE: Jonathan Marshall is the head of analysis at a think tank called Energy and Climate Intelligence Unit. He says efficiency is definitely part of the drop in energy use. But energy standards for appliances are the same across Europe.

MARSHALL: You have energy ratings for fridges that are the same in the U.K., in Poland, in Italy.

DOMONOSKE: And only the U.K. is seeing use drop like this. Then when it comes to homes, it's not like the British government is making a huge insulation push.

MARSHALL: There isn't really a particularly strong energy efficiency policy in the U.K. at the moment.

DOMONOSKE: It's not a total mystery. Other factors include a shift away from heavy industry, improvements in streetlamps, tightened standards for boilers and changing consumer patterns. But added together, they don't quite seem to explain the drop. These solutions are not thrilling.

MARSHALL: It's a lot easier to get, you know, excited about electric vehicles and wind turbines than it is about insulation.

DOMONOSKE: And, Guy Newey says, it doesn't help that there's no one reason for the drop.

NEWEY: Yeah. It's much easier if you can just point to one thing and say, oh, brilliant. If we just did X, it delivers Y benefit, and that's fantastic.

DOMONOSKE: Still, this little puzzle is good news for the policy fight against greenhouse gas emissions. Some people worry that restricting energy use could hurt a country's economy.

NEWEY: What we've seen, I guess, through history, is as people become richer, they tend to buy more stuff, use more stuff and consume more energy.

DOMONOSKE: But remember; the British GDP has been rising. That link between growth and energy use has been broken in the U.K.

NEWEY: The interesting question for kind of wider global energy policy is, can that example be replicated?

DOMONOSKE: So countries around the world could grow economically and slash emissions if they figure out what Britain is doing right. Camila Domonoske, NPR News.

(SOUNDBITE OF KORESMA'S "EMERALD POOLS") Transcript provided by NPR, Copyright NPR.