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The latest research from the Energy Saving Trust (EST) reveals that the average person does not believe their energy usage is harming the environment or their bank balance.
Phillip Sellwood, the chief executive of EST, said: "Consumers often fail to make the connection between their consumption of energy at home and the impact this has on our environment.
"Domestic energy usage is such that our own homes are the largest contributor to carbon dioxide emissions in the UK, accounting for a massive 26 per cent of the UK total.
"While energy efficiency begins in the home, for the last two years HM Treasury has failed to introduce any fiscal incentives for homeowners and support the objectives of the Energy White Paper, which is committed to delivering a cut in carbon dioxide emissions."
The organisation is calling on the government to lower VAT to 5 per cent on A-rated boilers, energy efficient appliances and other energy efficient products making them more affordable for consumers.
According to the EST, if every person in the UK were to turn down their thermostat by 1C for a week, GBP 14 million worth of energy would be saved.
Televisions, DVD players, satellite receivers and video recorders left on standby also cost GBP 3.5 million every seven days.
Mr. Sellwood added: "Climate change is the greatest threat facing the world today and the amount of energy we use, whether it is to cook or heat and cool our home, will have a direct impact on our environment."
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