The Merton rule is an energy policy first developed in the the London borough of Merton in 2003. In its original form, it required all new constructions of commercial buildings over 1,000 square meters to produce 10% of their energy on-site, using renewable resources.
This was intended to encourage green building in two ways: first, builders would want to make their buildings more energy efficient, so that the 10% that they were responsible for was smaller; second, they would be incorporating solar panels and wind turbines into their designs to produce this 10%.
This policy turned out to be very popular -- it cost local governments nothing, passing all costs of lowering carbon emissions on to the consumer, and allowed builders to use their problem solving skills to come up with new and creative solutions. It spread quickly, and in 2008 the United Kingdom actually made it a requirement that all local planning authorities adopt some sort of Merton rule.
There were problems, of course. As it happened, it was often easiest to keep fairly standard building plans but add in a dual-fuel boiler that can burn both regular fuel and biomass. This is problematic in two ways; biomass is not the most carbon-efficient fuel, and the requirement is that it can produce 10% off energy through renewable resources, not that it actually does. These boilers were frequently being installed with the full knowledge that they would not be used as intended.
Likewise, the rule does not make allowances for better solutions -- for example, a building designed to get all energy from a nearby wind farm would not meet the requirement of producing 10% of its energy on-site. It also does not take any other criteria of energy efficiency into account; a big box store on the outskirts of town may be extremely energy inefficient, but have a nice big roof for lots of solar panels, while a much more energy efficient apartment block in midtown may have limited roof space and be surrounded by taller buildings limiting light. If we were looking at environmental impact, we would prefer much more of the later and fewer of the former, but this policy reverses the incentives.
Since the 2008 mandate, progress has been made, but only in spurts and groans. Many councils are still stuck at the 'assessing feasibility' stage, and very few have fully implemented a Merton rule. Under David Cameron the government's rules and regulations relating to environment have been 'heavily adjusted', making forward progress on any project in this area seem like a bit of a fool's errand.