Despite having lowered its prices for many customers, British Gas has reported operating profits of £585 million for the first half of 2010. After cutting gas prices in February, British Gas acquired some 223,000 new customers to take its total number of customers to just under 15.8 million.

According to the firm’s parent company, Centrica, profits of £585 million represent a rise of 98 per cent on previous figures. Chief Executive of Centrica, Sam Laidlaw, hinted at further price reductions in the future.

Mr Laidlaw said: “This is a competitive market, so we can’t give any signals, but our position has always been to lead the market down and try to delay any price increases as long as we can”.

Recently, Centrica reported profits of £1.56 billion – a 65 per cent rise – for the first half of 2010. The figures announced by both companies have prompted energy and consumer watchdogs to call for further price cuts.

Ann Robinson, of the price comparison service, uSwitch, said: “Today’s profits suggest that suppliers could actually afford to pass on even more benefit to consumers by cutting their prices again”.

Amid the news of increased profits and calls for lower energy bills, the Conservative-Liberal Democrat coalition Government has extolled the benefits of carbon cutting measures. In particular, the Government has claimed that the average annual household energy bill would rise by just £13 in order to subsidise renewable energy initiatives.

The UK Government aims to meet targets to cut carbon emissions by 34 per cent by 2020 and 80 per cent by 2050. In respect to the earliest target, various carbon cutting measures – 32 of which were published this week in the coalition Government’s first annual energy statement to Parliament – will be funded in part by an increase in domestic fuel bills.

It is estimated that, by 2020, the average household bill for gas and electricity would be £1,239 – just £13 higher than estimated bills excluding green policies. Currently, the combined energy bill for the average UK household is around £200 cheaper than the 2020 estimate.

As if the housing market had not endured enough difficulties in recent times, it has been reported that the coalition Government is considering a new green tax that could add around £850 to the cost of buying a typical home.

Furthermore, new owners would be required to spend at least £15,000 on energy efficiency improvements before they would be entitled to a rebate. According to estate agent Steve Thomas, of Townends, the plans are sheer “madness”, whilst Nicholas Leeming of zoopla.co.uk argued: “Some 65 per cent of UK homes were built before 1965 and, in London, 27 per cent before the first world war. This would clearly be unworkable”.

The new green tax, which was actually commissioned by the former Labour government, would require new buyers to shell out an additional 0.5 per cent stamp duty on homes that were considered to have a poor energy rating. As with many such schemes, however, a carrot and stick approach is adopted; if the homeowner can improve the energy rating within one year of purchasing the home, up to twice the additional stamp duty could be reclaimed from the Green Investment Bank.

Unfortunately, improving the energy efficiency of an old home can be a difficult and expensive endeavour in some cases; installing energy efficient central heating boilers, loft insulation or cavity wall insulation and double glazing are typical examples of the ways in which energy efficiency can be improved at the domestic level.

Applying only to homes for sale with F and G energy efficiency ratings, the new green tax would aim to encourage homeowners to improve their properties to E or higher. As the housing market continues to struggle following the credit crunch and global recession, however, many industry experts have spoken against the new tax.

Rosemary Rogers of www.reallymoving.com warned that the green tax would “stop the already fragile [housing] recovery in its tracks”, whilst many others have argued that those most affected by the plans would be the relatively young and poorly paid; indeed, wealthier home buyers would be in line to receive the highest stamp duty rebates.

Despite promising to become the “greenest government ever”, Prime Minister David Cameron has sought to bypass green initiatives in favour of deep public spending cuts. This week, the Government has announced that it has made plans to close the Sustainable Development Commission, which operates a broad selection of projects in the economic sphere.

Whilst hardly living up to his green ambitions, David Cameron’s decision to axe the Sustainable Development Commission in order to reduce public spending might be considered somewhat ill-advised on the basis that the sustainability watchdog is said to save the Government considerable amounts of money – precisely how much is unclear but proponents argue that savings far outweigh costs.

The Sustainable Development Commission undertakes activities in a multitude of fields, including Capability Building, Climate Change, Consumption and Business, Economics and Energy. Sustainable development is pivotal to the success of the UK’s carbon emission targets, which have become increasingly threatened by widespread spending cuts in the public sector. One of the most influential areas in which the Sustainable Development Commission has operated during recent times is Built Environment. The sustainability watchdog’s commissioner, Anne Power, previously stated that at least “80 per cent of the current housing stock will still be standing in 2050. Therefore, tackling its energy efficiency is vital to our future”. The Commission has aimed to create a sustainable built environment that enables people to “live within environmental limits whilst maximising quality of life”.

The Sustainable Development Commission is currently involved in various projects affecting new and existing housing, neighbourhoods, schools and communities. Supporting the installation of energy efficient central heating boilers and renewable solar panels are just some of the many ways in which the Commission has attempted to nurture a more sustainable environment. Following the news that the sustainability watchdog is to close, many people fear that Britain is reneging on its environmental obligations, which could harm both the environment and the economy. The Green Party’s Caroline Lucas MP commented: “If the current government is to really stand a chance of getting its head round sustainability, the urgency of the threats and the huge opportunities to benefit this country’s economy as well as its people through green policies, we need the Sustainable Development Commission”.

The global recession has had both a positive and negative effect on the environmental situation in the UK. On the one hand, the economic downturn has contributed towards lower carbon emissions – although, CO2 levels are expected to rise again as the country claws its way out of the recession – on the other hand, many homeowners have chosen not to improve the energy efficiency of their homes due to financial concerns or constraints.

There are many ways in which homes can be made more energy efficient, not least by upgrading old central heating boilers or insulating lofts and cavity walls. The cost associated with such endeavours, however, has driven many homeowners to the conclusion that now is not the time to think about the environment. According to new analysis by the Energy Saving Trust, this could not be further from the truth.

The Energy Saving Trust has revealed that, in 2008, 17 per cent of homes in England were categorised in the F and G bands, which represent the lowest gradings on the energy performance certificate (EPC). This figure contrasts favourably with that of 2006, at which time 22 per cent of homes fell into the lowest EPC bands.

Although the trend of improved energy efficiency in UK homes is expected to continue, the Energy Saving Trust fears that not enough homeowners are doing their bit to reduce carbon emissions at the domestic level. Furthermore, the Trust claims that it would cost just £3,000 to bring an F or G rated home into the E band.

At present, the average UK home falls into the D band, which is encouraging but perhaps not good enough to meet wider carbon emission targets. Bringing the UK’s most energy inefficient homes into the E band is thought to provide the most substantial savings in terms of carbon emissions and energy efficiency, which can also result in significantly lower annual fuel bills. Housing Strategy Manager for the Energy Saving Trust, David Weatherall, claimed that F and G rated homes could be improved for “less than 2 per cent of the sale price of the average UK home”.

According to a report published last week by Greenpeace International, the European Union could reduce carbon emissions by up to 95% compared to 1990 levels if it fully harnesses renewable technologies, such as wind turbines and solar panels.

The report also argues the European Union could obtain as much as 92% of its total energy requirements from renewable sources by 2050; however, according to Greenpeace and the European Renewable Energy Council, achieving such targets would require additional investment worth around €2 trillion (£1.7 trillion). Whilst such a figure may appear on the large side amid persisting economic uncertainty, Greenpeace has argued that committing to renewable energy sources would result in fuel cost savings of €2.65 trillion.

A spokesperson for Greenpeace said: “This study shows that investing in green energy will nudge up the cost of electricity in the short to medium term. But it will save trillions of euros in fuel costs alone by 2030 and represents an immediate investment in jobs and energy security”. The feasibility of the report was given additional weight by the President of the Federal Environment Agency, Jochen Flasbarth, who said: “A complete conversion to renewable energy by 2050 is possible from a technical and ecological point of view. It’s a very realistic target based on technology that already exists – it’s not pie-in-the-sky prediction”.

UK homeowners are already aware of the drive to reduce carbon emissions – a policy that was introduced by the previous Labour Government. Over the past year or so, various schemes have been implemented in the UK to assist homeowners in reducing their carbon footprint; notably, the Boiler Scrappage Scheme, which provided money-off vouchers to eligible households applying to upgrade E-rated central heating boilers to more energy efficient A-rated units, was a resounding success in the UK (although not so much in Scotland, where demand far exceeded supply) and the newly announced Feed-in Tariff that provides an incentive for homwowners to install solar photovoltaic panels.

To many, the Greenpeace report will appear overly ambitious; to others, it will seem those in power will do everything possible to hang on to non-renewable technologies for short-term gain. Whatever the case, each household in the UK can contribute to the global picture by reducing its carbon footprint through a variety of green initiatives.

The Chief Executive of the Committee on Climate Change, David Kennedy, has just warned the new coalition government urgent action must be taken if the UK is to meet its carbon emissions targets.

Mr Kennedy claimed at least four key areas must be addressed, including policy changes to reform the electricity market. Mr Kennedy said: “We’ve had a light-touch approach in the UK, we’ve talked a good game but what we’ve seen is emissions haven’t fallen. We need to do something different. What we have to do isn’t news and is becoming very well known”.

It has been estimated that greenhouse gases in the UK fell by 8.6% last year – a relatively substantial reduction by most standards. Chair of the Committee on Climate Change, Lord Turner, stressed the apparent fall in carbon emissions was almost entirely the result of the recession; lower economic output tends to have a positive effect on reducing carbon emissions.

Environmentally friendly initiatives such as the Boiler Scrappage Scheme, which provided financial assistance to eligible households that replaced their old, energy inefficient central heating boilers with A-rated condensing boilers, have had little effect according to Lord Turner. Likewise, the installation of solar photovoltaic panels and wind turbines on private and public land across Britain has made little impact on reducing carbon emissions.

Mr Kennedy stressed the coalition government made a number of key pledges on environmental change before the election and the time for implementing such change is now. Mr Kennedy urged: “These commitments are at the moment good intentions. What we need is to translate these into crunchy policies in power, buildings, transport and agriculture. The test of this government will be the policies they put in place over the next year or two”.

Meanwhile, the head of Friends of the Earth, Andy Atkins, said: “It’s extremely disturbing that, despite a similar warning from the committee last year, the recent fall in UK emissions is mainly due to the recession. This report [from the Committee] is further evidence of the need to build our future prosperity on safe, green foundations”. How the Government intends to implement its green policies amid widespread public spending cuts remains a mystery to voters.