Category Archives: Green Deal

Lies, damned lies and Green Deal

DECC minister Greg Barker was interviewed on BBC’s Newsnight last week about the success of the Green Deal.

newsnight-barker

Cutting through the obfuscatory statistics seems difficult for Mr Barker. Let’s look at what DECC have actually published as Green Deal statistics up to the end of October 2013.

The number of households which have had Green Deal measures installed: 219

The number of measures installed: 481

What were those measures?

Boiler: 178

Cavity wall insulation: 7

Loft insulation: 37

PV: 78

Heating controls: 71

Hot water cylinder insulation: 29

Hot water cylinder thermostat: 16

Solid wall insulation: 65

Number of Green Deal Advisors: 2687

Number of Green Deal Providers: 112

Number of Green Deal Installers: 2020

Permitted development and solid wall insulation

The Department for Communities and Local Government (DCLG) have today issued some clarification on the issue of solid wall insulation (SWI) and permitted development. It had been thought that planning permission would generally be required for SWI as its installation effectively moves the front of the house forwards towards a highway, something that is specifically excluded from being allowed under permitted development.

But now the DCLG have issued guidance which unequivocally states that SWI is covered under permitted development:

The installation of solid wall insulation constitutes an improvement rather than an enlargement or extension to the dwellinghouse and is not caught by the provisions of d(i) and d(ii).

This guidance only directly covers England (as it makes reference to the Town and Country Planning (General Permitted Development) (Amendment) (No.2) (England) Order 2008) but I expect it to be equally applicable in Wales which has near identical permitted development regulations. Scotland may be another matter.

This small change should make the lives of Green Deal SWI installers much simpler.

RHI cost control consultation

Alongside yesterday’s announcement from DECC of the extension for RHPP was the launch of a consultation on their proposals to introduce an interim cost control mechanism for the RHI budget, pending the setting up of a more structured measure in the future.

This proposes to simply suspend the scheme should the current year budget be spent and represents a return to the style of operation that destroyed the Low Carbon Building Programme (LCBP) grant funding mechanism that the RHI and FiTs was designed to replace. One of the options under consideration is for the scheme to be closed down with no notice period at all.

Can DECC really be serious about this? Just check that April 1st hasn’t come early.

But just maybe it isn’t anything to really worry about. If you look at the budget versus actual figures so far (included in the consultation document) then the RHI is not proving to be attractive in the non-domestic sector.

Financial year     Budget (£m)
2011/12            56
2012/13            133
2013/14            251
2014/15            424
Total              864

This includes the £15 million allocated to RHPP in the present year and the announced £25 million for the coming year. The actual spend in the current year is less than £5 million representing a total underspend of £51 million and DECC are predicting a total spend in the coming year of only £55 million against the budgeted £133 million – another underspend of some £78 million.

The only problem here is that if a budget is underspent in any financial year then that money disappears and is lost from the RHI budget as there is no carry-forward of unspent cash.

So in its first two years the RHI will have underspent a total of £129 million. Not exactly a major success story and if this was to continue then the budget control mechanism would never actually be used.

A Real Deal? Making the Green Deal Work – CBI Report

The Government’s Green Deal risks failing to attract the businesses it needs to deliver its flagship energy efficiency scheme unless it provides greater clarity on how it will be financed and promoted, the CBI said today.

The Green Deal will allow people to take out loans to improve the energy efficiency of their properties, including for insulation, heating and lighting. The loans are to be attached to the property and will be paid back over a fixed period through the savings made on energy bills.

However, with a new CBI survey showing that three-quarters of the public do not even consider the energy efficiency of a property when buying or renting a home, the Government clearly needs to do more to get consumers to buy into the concept. This is a vital first step to ensure there is a market for the businesses that will deliver the scheme.

Dr Neil Bentley, CBI Deputy Director-General, said:

Improving the energy efficiency of our homes and businesses is a surefire way of cutting emissions, as well as creating economic growth.

The Green Deal is a good idea, but risks becoming a lame duck unless the Government tackles the big questions of financing and uptake.

The Government faces an uphill challenge convincing home owners to sign up to the Green Deal, given that three-quarters admit they don’t consider energy efficiency when looking at a property.

To ensure the scheme is a success, the Government needs to clarify how the Green Deal will be paid for in the early stages to give investors confidence, and make it simple and hassle-free for consumers.

In a new report called A Real Deal? Making the Green Deal Work, the CBI is calling on the Government to deliver:

· A financial model that is attractive to private investors with a decision by Spring on where the default risk will lie, ensuring that it does not undermine the ability of smaller firms to become providers.

· DECC should also provide robust and realistic modelling to show expected payback periods, including for different types of properties

· A range of policies to encourage take-up of the Green Deal by the public, which could include rolling out Display Energy Certificates to commercial properties

· Promoting the Green Deal through targeted communications at appropriate trigger points. For example, when people are buying their first home or installing a new boiler.

· Establishing a strong, recognisable Green Deal kitemark and system of accreditation to generate confidence and trust, both among potential consumers and providers.