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UK could cut electricity demand by 40%, says McKinsey

Posted on 19 July 2012

The UK could decarbonise its electricity supply system at a much
lower cost through greater demand reduction, according to new
government-sponsored research.

A huge total of 40%, or 155 terawatt-hours, of present demand could
be eliminated by 2030. Reducing demand by such an extent would mean that
many of the more expensive or risky forms of generating electricity
currently being considered could be put on the backburner.

The figure comes from a draft report, 'Capturing the full electricity
efficiency potential of the UK', commissioned from McKinsey and Co.,
that has been published by the Department of Energy and Climate Change
for peer review.

The analysis says that current Electricity Market Reform proposals
would only realise 54 terawatt-hours (TWh), or around one third of the
full potential savings. Further measures would therefore be required to
capture the remaining savings.

The review concentrates on the three largest categories of abatement
measures per sector, which it says could together deliver 127 TWh of
savings, or 80% of what is possible.

In the residential sector, these measures include better insulation,
energy-efficient lighting and more efficient appliances, which could
achieve 58 TWh reduction. Three quarters of this demand reduction is
already expected to be achieved through current or planned policies,
primarily in increased appliance efficiency.

In the services sector, the measures include better insulation,
lighting controls and heating, ventilation and air conditioning (HVAC),
which could achieve 45 TWh reduction. 15% of this is expected to be
achieved through current or planned policies.

In the industrial sector, the measures include pump, motor and boiler
optimisation, totalling 24 TWh of savings, of which only about 5% is
expected to be captured through current or planned policies.

The researchers reckon that by 2020, 115 TWh could be saved, of which 60% is expected to be achieved by current policies.