Energy saving light bulbs: Your light bulb concerns answered 'Free' energy saving light bulbs

Energy suppliers have been banned from sending energy saving bulbs to customers

Why has my energy supplier sent me free energy-saving light bulbs?

Energy companies are supposed to do more than just sell you as much gas and electricity as they can – they’re also obliged to help UK households reduce their CO2 emissions.

The government’s Carbon Emissions Reduction Target (CERT) requires suppliers with more than 50,000 customers (currently only the ‘big six’ suppliers: British Gas, EDF, Eon, Npower, Scottish and Southern, and Scottish Power) to help their customers install energy-efficiency measures that will cut the amount of energy they use.

These measures typically include loft insulation, cavity wall insulation, and – until the free giveaways were recently banned – energy-saving light bulbs.

Do I have to pay anything towards the cost of these energy-efficiency measures?

While it sounds fantastically altruistic, we’re actually all paying for this. Energy regulator Ofgem estimates that the average household pays a startling £84 in ‘environmental levies’ through its annual energy bills, of which £45 goes directly towards funding CERT.

Your money is helping energy companies to meet the total CO2 savings they need to achieve by the time the CERT scheme ends in 2011. If utility suppliers don’t meet this target, they get fined up to 10% of their turnover.

Npower sent out 12m unsolicited energy saving light bulbs in late 2009

Why have energy suppliers been banned from sending free energy-saving light bulbs?

To help achieve their CERT savings, energy suppliers have sent out a staggering 182m energy-saving light bulbs through direct mail-outs to their own customers, and through partnerships with newspapers and retailers.

But following concerns that consumers were not using the bulbs given to them – meaning the CO2 savings claimed by suppliers were possibly not being achieved – these free bulb giveaways and direct promotions were banned on 1 January 2010.

This could explain why Npower – for the fourth Which? Utilities satisfaction survey running, your least-favourite supplier – decided it would bombard its three million customers with an avalanche of 12m unsolicited bulbs in a mail-out that was completed by New Year’s Eve 2009.

Why were energy-saving light bulbs so popular with energy suppliers?

While Npower's motives may seem cynical, they’re understandable from a purely commercial point of view.

According to the government’s own figures, mailing out four free bulbs to 345 households (1,377 bulbs in total) saves 68.83 tonnes of CO2 over the lifetime of the bulbs (provided they’re used in high-use fittings), saves each household £14 a year, and costs the energy supplier a total of £1,886.

A £14 saving isn’t much to get excited about – in fact an energy supplier could spend the same money on a 20% contribution (the amount the government assumes suppliers will put in) towards the cost of solid wall insulation for one of Britain’s 6.6m old and poorly-insulated solid-wall properties. This would cut a typical household’s gas bill by £420 a year, and save the same amount of CO2 as all those bulbs put together – assuming that all of them do actually get used.

When Which? questioned Npower about its light bulb mail-out, it claimed that all suppliers used light bulbs to help meet their targets (Npower has, to be fair, relied on energy-saving bulbs far less than other suppliers in the past), and that CERT didn’t require suppliers to get evidence that bulbs are being used as using them was ‘up to the customer’.

Are there any other problems with energy efficiency measures offered by energy suppliers?

Our experts also noted a lack of evidence for other CERT measures installed in households. The use of questionnaires to collect information about energy-efficiency is unreliable as only the most engaged consumers are likely to respond, and verifying the accuracy of answers is difficult. A lack of financial monitoring also means it’s impossible to know how much suppliers are spending on CERT.

PAYS loans could help consumers install energy-saving measures with no up-front costs

What improvements would Which? like to see?

Our energy satisfaction survey shows that the big energy suppliers are not popular with their customers – only one in five of you feel that your supplier values you as a customer. And using your money to play the rules so that their profits don’t get hit won’t endear energy suppliers to you anymore.

Pressure needs to be put on suppliers to be more transparent about what they’re spending to meet CERT targets, because consumers need to be confident they're getting value for money.

CERT needs to be reviewed to make sure it’s structured in a way to deliver energy-saving measures that benefit consumers, not energy suppliers. One possibility is to combine it with a national system of ‘pay as you save’ (PAYS) loans, so measures can be installed with no up-front costs, and financial and environmental savings start from day one.

The Department of Energy and Climate Change has recently published a new strategy that promises to address some of the issues with CERT, including transparency and PAYS loans. We’re currently studying the proposals in detail and will report on them soon.

In this section

You may also be interested in