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The central aim of this thesis is to identify a route to achieve 60% carbon savings in the UK domestic sector by 2050. This has led to two key questions: Is a strategy of relying largely on improvements in energy efficiency likely to achieve the required savings If not, could personal carbon rations offer an alternative route To answer the first question, both the past record and future projections of savings from energy efficiency are investigated. Thirty years of energy efficiency improvements have led to an increase of a third in final energy use, due to a contemporaneous increase in demand for energy services. A bottom-up energy model shows that even modest social and behavioural changes could lead to a future increase in energy consumption of 23% by 2050. In combination with these demand increases, even maximum implementation of energy efficiency measures could only deliver a 17% saving. Policies for improving energy efficiency do nothing to restrain demand for energy services, and this makes it very unlikely they, alone, can deliver 60% carbon savings by 2050. This thesis proposes that personal carbon rationing, for household and personal transport energy, would provide a framework for guaranteed and equitable carbon reductions, within a context of global carbon reductions. Each person would get an equal ration which would reduce over time. Equal carbon rations would not affect everyone equally because emissions currently vary considerably between groups and individuals. Personal carbon emissions for 32 case study individuals varied by a factor of 12. Therefore a variety of responses to rationing will be required, and energy efficiency will remain an important strategy within the rationing framework. It is concluded that personal carbon rations have considerable promise for achieving 60% savings by 2050.

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This research contributes to a better understanding of how, if at all, different policy instruments, market structures and regulatory regimes can engender the increased use of green energy innovations. From a policy perspective, this focus arises from the growing importance of green energy innovations in helping to tackle concerns about rising fossil fuel costs and global warming. From an academic perspective, there has been a good deal of work on how 'governments can stimulate the development of new,innovations (induced innovation) but only limited and disparate contributions on how government~ can engender the greater use of existing innovations (induced diffusion). This research, therefore, enhances the academic understanding of induced diffusion by, inter alia, providing a generic definition for induced diffusion; synthesising academic contributions which fall under the definition of induced diffusion; and by conducting empirical research that addresses identified gaps in the understanding of induced diffusion. Methodologically, this research project can best be described as a 'policy thematic interdisciplinary three-study multi-method' thesis that takes its theoretical grounding from economics, environmental studies, finance, and marketing and management. Hence, following a number of dimensional choices, simplifying assumptions, and definitions, the broad-ranging policy and academic objectives of the thesis are tackled by having a focused research strategy that is concentrated on three empirical studies. The three studies are concerned with: (1) the take-up and potential of domestic green energy tariffs in the UK; (2) the patterns of international wind energy diffusion; (3) the adoption of household energy savings technologies in the UK. The findings of the thesis are multip!e and range from those of academic interest to those of policy interest or both. For instance, both the first and the last study highlight the importance of understanding adopter environments (market structure, information problems, consumer behaviour) if credible policy recommendations are to be made. Furthermore, an important academic contribution comes in the second study, where the results obtained raise the possibility that patterns of diffusion under induced diffusion may not in fact be'S' shaped.

In February 2003 the Government issued a White Paper reviewing energy policy. Diminishing indigenous natural supplies, the loss of the United Kingdom's nuclear energy generation capacity, with the exception of the Sizewell B nuclear power station, by 2020 and an increase in both local and global demand for energy are leading toward an energy crisis. The Government must reduce greenhouse gas emissions by 60% of their 1990 levels by 2050; this means the required additional energy capacity should not be achieved by burning further fossil fuels. Renewable sources of energy are not either sufficiently technologically advanced or economically viable to account for the approaching shortfall. New nuclear energy generation facilities could potentially generate the required energy without increasing greenhouse gas emissions. An innovative solution to create economically viable, value for money nuclear energy generation facilities is required. The Private Finance Initiative is a procurement model aimed at providing value for money and the efficient allocation of risk within a project. Through the use of an extensive literature review and two semi-structured interviews a theoretical model was developed and refined to show what stimulants and impediments exist in the application of the Private Finance Initiative to provide better value for money in nuclear energy generation. The main stimulants to the PFI and its use in nuclear energy generation are the ability of nuclear to provide affordable, reliable and secure, environmentally acceptable energy and with the use of PFI achieve those aims through competitive markets, thereby meeting the aims of the White Paper. The main impediments include current political uncertainty over licensing and approvals of new nuclear plants, uncertainty over waste policy and an overall uncertainty over the future of the industry itself.

Due to energy scarcity coupled with environment issues, it is likely to see the biggest shift in generation portfolio in the UK and world wide, stimulated by various governmental incentives policies for promoting renewable generation and reducing emission. The generation expansion in the future will be driven by not only peak demand growth but also emission reduction target. Thus, the traditional generation expansion planning (GEP) model has to be improved to reflect this change against the new environment. The policy makers need a better assessment tool to facilitate the new environment, so they can make appropriate policies for promoting renewable generation and emission reduction, and guide the generation mix to evolve appropriately over time. Since the expansion of new generation capacities is highly capital intensive, it makes the improvement of GEP quite urgent and important. The thesis proposes the GEP modelling improvement works from the following aspects: • Integrating short-term emission cost, unit commitment constraints in an emission target constrained GEP model. • Including the network transmission constraints and generation location optimization in an emission constrained GEP. • Investigating the impacts of multi-stage emission targets setting on an emission constrained GEP problem and its overall expansion cost. • Incorporating the uncertain renewable generation expansion and short-term DSR into the GEP problem and find out its potential contributions to the GEP problem. A real case study is made to determine the optimal generation mix of the Great Britain in 2020 in order to meet the 2020 emission reduction target. Different optimal generation mixes of the UK in 2020 are identified under a series of scenarios. The scenarios are constructed according to different GB network transmission capacity hypotheses and demand side response (DSR) level scenarios.

Creating a diverse and flexible energy system to ensure security of supply is at the heart of UK energy policy. However, despite the apparent interest in the idea of securing supply in this way and the term ‘diversity' becoming more frequently used in this context in government White Papers, policy discourse and the academic literature relatively little attention has been given to exploring what diversity means, how it can be measured, what contribution it can make to different policy objectives and the specific implications for the UK electricity system. Furthermore CCS technologies which are becoming increasingly important to decarbonisation of the power sector in order to meet legally binding greenhouse gas targets set out in the Climate Change Act which raises the question, what are the potential impacts of these technologies on the diversity of the future UK electricity system? To answer this question a mixed methodology of quantitative energy-economic modelling (using MARKAL), scenario analysis and diversity analysis is combined with qualitative semi-structured stakeholder interviews. Data analysis is carried out in two parts. The first assesses the diversity (with a specific focus on the effect of different input assumptions on CCS technologies) of the scenarios generated using Stirling's Diversity Heuristic and creates a set of ‘diversity profiles' which map changes in diversity across each scenario. The second part uses stakeholder perspectives to inform the quantification of diversity across the same set of scenarios providing evidence of the impact of different stakeholder perspectives on the overall diversity of the electricity system.