Electricity firm spends pounds 500,000 to save power: Energy efficiency schemes are being lavished on a small island. Nicholas Schoon reports

WHEN 8 per cent value-added tax makes its cruel mark on gas and power bills next April, Holy Islanders will be able to smirk. By then, the small island off north Wales, a ferry port for Ireland, is expected to have cut its electricity bills by 13 per cent in little over a year.

The community does not have much to smile about with one of the highest unemployment rates in Wales, but it does have Manweb, a regional electricity company which wants its customers to buy less power.

The reason: if electricity demand keeps rising at the rate of 2 per cent a year, then Manweb could have to spend pounds 750,000 uprating Holy Island's power link to the larger neighbouring island of Anglesey and the mainland. The two existing transformers are in danger of becoming overloaded.

Manweb wants to delay that investment, hopefully indefinitely. It is spending pounds 500,000 on a campaign to persuade the island's 3,500 households and dozens of shops, offices and factories to use less electricity.

The company is, in effect, giving energy conservation away; nothing like it has been tried in Britain. It has encountered widespread suspicion, but also much public enthusiasm.

Behind this campaign lurks a subversive, deep green idea - that utilities can actually make profits by selling less energy and a superior service to their customers. And as less power is used, so less acid rain and fewer global-warming gas emissions are produced by power stations.

While the Power Save campaign, launched last December, had no national impact, extensive leafleting, advertising and surveying on the island ensured that everyone there had heard about it.

Each home was offered two energy-saving light bulbs for the price of two ordinary light bulbs - pounds 1.40. These bulbs use one fifth of the electricity of the ordinary type and last five to eight times as long, but they cost 10 times as much. Almost every household took up the offer.

Manweb also gave away several hundred free lagging jackets for uninsulated hot water cylinders. It offered free draught- proofing of doors and windows and loft insulation worth about pounds 200 to low-income households who were unable to qualify for government energy-saving grants. The company also devised a discount scheme which encouraged people to buy the most energy-efficient electrical appliances.

For businesses, the company offered a free energy audit to show how they could save power and ran seminars, but Manweb found it hard going.

Several companies were shown energy conservation investments which would pay off the initial costs in less than one year through reduced bills, yet they still were not interested. Others were more open-minded. Michael Guiness, who owns a toy factory employing 150 people in Holyhead replaced one plastic injection moulder which swallows pounds 5 of electricity an hour with a new pounds 45,000 one from Austria which sips only 80p worth.

Despite a mixed response to its campaign, Manweb believes it is on course to knock the island's peak demand from nine megawatts to eight. It will know if it is succeeding in the spring, after closely monitoring the three winter months of maximum consumption and comparing them with last year.

(Photograph omitted)