Calderdale’s Energy Future & Green Deal

Calderdale’s Energy Future expects householders to cut 25% of their carbon emissions by 2020, based on 2005 levels. To achieve this target, the Council will encourage households to buy in to the Green Deal, with the Council aiming to become a Green Deal provider.

As part of its programme of swingeing public spending cuts, the Coalition Government has withdrawn previous subsidy schemes for home energy efficiency retrofits like insulation. Instead, it has introduced the Green Deal -a scheme for householders to pay for improvements to their home energy efficiency by taking out loans. The idea is that they will repay the loans out of savings on their energy bills, over the lifetime of the energy efficiency measures – 25 years. The measures will be things like installing insulation, upgrading to more energy efficient domestic appliances and installing micro-renewables.

Estimates are that this will reduce the number of lofts that get insulated each year by 93%. Yes, mad or what?

A  Calderdale’s Energy Future cost/benefit analysis,  carried out by Leeds University and funded by the Department of Energy and Climate Change, shows that Calderdale households’ savings on energy bills would more than repay the  energy efficiency investments within a few years. But that assumes that the Green Deal arithmetic adds up, and the evidence is that it doesn’t.

Climate Change Committee says Green Deal will lead to less insulation 

The Committee on Climate Change, which advises the UK government, has said that entirely market-based schemes like the Green Deal haven’t worked anywhere else in the world and it isn’t likely to work here either. And the government’s own initial impact assessment in December 2011 predicted that the Green Deal won’t work. The June 2012 revised version of the impact assessment doesn’t substantially change the picture.

The Climate Change Committee recommends that the big six energy companies should pay for home energy efficiency retrofits

The Climate Change Committee has recommended that the government should require the energy companies to pay for all the home energy efficiency improvements needed to meet the 2022 target for reducing household carbon emissions. The CCC says that home energy efficiency retrofits should be carried out street-by-street, on a whole house basis – in other words, that each house should be thoroughly retrofitted in line with its individual requirements.


The Energy Bill Revolution alternative – the government should use carbon taxes to pay for home insulation

As an alternative to the Green Deal, the Energy Bill Revolution Alliance is calling on the government to use carbon taxes to pay for insulating the UK’s homes.

June 2012 update to Green Deal impact assessment 

The government’s recent revision of its  Green Deal impact assessment predicts that as a result of the Green Deal, the number of loft insulations will fall by about 83%, from about 900,000 in 2012 to 150,000 in 2013. This is better than initial impact assessment which predicted a 93% fall in loft insulations. But it’s still pretty disastrous.

The revised Green Deal impact assessment predicts less of a fall in cavity wall insulations following the introduction of the Green Deal than the initial impact assessment’s predicted 67% fall. The revised assessment predicts a fall of merely 43%.

The new impact assessment follows government changes to the original Green Deal proposals. In the face of widespread criticisms, the Coalition government has allowed some additional lofts and cavity walls in low-income areas to become eligible for the new, Energy Company Obligation (ECO) subsidies.

The ECO is a new requirement that the government is placing on energy companies, to spend some of the money they receive from customers paying their gas and electricity bills, on providing customers with subsidised energy efficiency/carbon reduction measures.

ECOs will replace, at a lower level, the current energy efficiency subsidies to customers that energy companies have to provide through the Carbon Emissions Reduction Target programme. So ECOs will reduce the amount that the big six energy companies have to give back to customers to help them improve their energy efficiency – at a time when the big six energy companies are profiting from scandalously high energy prices to customers.

The government’s initial Green Deal impact assessment

The original calculations were that with the Green Deal, loft insulation would fall from just over 1million a year, as carried out by current government schemes like Warm Front, to 70,000 a year. 2 million a year are needed to meet climate targets. Cavity wall insulation would fall from the current 510,000/year to 170,000 – far below the Green Deal target of 1.4 million/year. The initial impact assessment estimated that solid wall insulation will increase through the Green Deal, but not to levels that will cancel out the reductions in loft and cavity wall insulation.

Home insulation information and predictions, DECC data, Guardian graphic

Changing building regulations to make people sign up to Green Deal?

On 19th March, the Chairman of the Committee on Climate Change wrote to the Department for Communities and Local Government to “strongly support” the idea of changing building regulations, so that they would require loft and cavity wall insulation to be carried out whenever boilers are replaced or houses are extended. He says that since around 10 million boiler replacements are likely over the next decade, this new regulation would “buttress the Green Deal through creating demand and therefore provide more confidence that a market will develop.”

Energy Royd invited Calderdale Councillor Barry Collins to comment on Calderdale’s Energy Future’s reliance on the Green Deal as the way for householders to reduce their carbon emissions. Councillor Collins said, “It wouldn’t be useful for me to be involved in a debate which has already become polarised. Our position as the Council has been openly agreed in an open Cabinet meeting, and prior to that in public consultation meetings.” Around one hundred people attended the public consultation meetings.

The Green Deal is a privatised home insulation programme, following cuts to public spending on home insulation

The Green Deal is a change from previous policies of publicly funding improvements to household energy efficiency, through schemes like:

  • the Warm Front scheme
  • Big Six energy company subsidies for customers’s home energy efficiency improvements through the Carbon Emissions Reduction Target programme,
  • local authority subsidies for low income and fuel poor households’ energy efficiency retrofits

Unlike the Green Deal proposals, which are likely to benefit better off households, current means-tested home insulation programmes benefit low income households. These programmes are due to be phased out by the autumn of 2012.

In 2011, the Coalition government’s Comprehensive Spending Review cut 80% of Leeds City Region local authorities’ funding for domestic energy efficiency improvements and carbon emissions reduction. As a result, Leeds City Region local authorities – including Calderdale – have had to replace their publicly- funded household energy efficiency schemes with attempts to stimulate the market for domestic energy efficiency improvements, in order to make the new Green Deal work.

Since the local market for energy efficiency measures has been shrinking in the recession, because people have less money to spend, this is likely to prove difficult. Chris Brown, Housing Regeneration Manager for Bradford Metropolitan Borough Council, has said, ”There is a question of whether the market will work without subsidies being available. We would suggest there needs to be subsidy available to entice customers to take up the measures.”

This means that Calderdale Council needs to try and attract private sector “partners” who will spend their Energy Company Obligations in the area. Together with other Leeds City Region local authorities, Calderdale Council intends to become a Green Deal Provider. This will require Leeds City Region to borrow the millions needed to provide upfront funding for the Green Deal, which participating households will then repay out of the savings on their energy bills.

Energy Company Obligations (ECOs) are new requirements that the government is placing on energy companies, to provide some subsidies for home energy efficiency improvements for fuel poor households and those in old stone houses which are expensive to retrofit (also called hard to treat houses). They will come into effect in September 2012 and replace the previous energy company subsidies for home insulation, which will end in December 2012.


Updated 21/1/2013 with link to New Statesman article.

2 thoughts on “Calderdale’s Energy Future & Green Deal

  1. I’d just like to comment on your figures for the low number of loft insulations and cavity wall insulations that are likely to be carried out under the Green Deal, compared with those caried out under Warm Front. I’m not saying the figures are wrong, but they are what you’d expect, bearing in mind that most of the ‘easy to treat’ properties have already been done. The vast majority of people with brick cavity walls have had them insulated, and those who haven’t had them done have chosen not to do so for a reason, and they are unlikely to change their mind when the Green Deal comes in. Same goes for lofts – the main reason is that people have boarded over joists (which may have already had 4-6 inches of insulation) and are not prepared to lift the boards to add another layer. They are not going to take out a Green Deal loan if it means taking all their stuff out of the loft, lifting up the boards and add another layer of insulation which is so deep they can’t put the boards back again- in other words they will lose the useful storage facility. I would think the only people likely to take out GD finance for cavity or loft insulation would be people moving into a house where the previous occupant has chosen not to avail themselves of all the excellent discounts and grants that have been available. Not a great many.
    Potentially there could be more people installing solid wall insulation – and this will be subsidised by the ECO fund – but my experience is that very few would want the upheaval that internal SWI brings. Though we might see an increase in extrnal SWI for those properties where it is suitable.

    • Hi again Anne

      I know this is an old posting/thread, but I’ve just been re-reading the Green Deal stuff, and I’d like to pick up on your comment.

      1) You wrote: “the vast majority of people with brick cavity walls have had them insulated ….- same goes for lofts”.

      But DECC figures [ ] show that about 42% of cavity walls are still uninsulated and 43% of lofts are still uninsulated. The DECC statistical report from June 2011 says:

      “ It is estimated that at the start of April 2011:
      There are 26.6 million homes in Great Britain. Of these 23.3 million have lofts. 18.7 million have cavity walls with the remaining 7.9 million having solid walls.

      13.2 million homes had loft insulation of at least 125mm, around 357,000 higher than in January 2011.

      10.8 million homes had cavity wall insulation, around 203,000 more than in January 2011.

      104 thousand homes had solid wall insulation, around 4,000 more than in January 2011. Solid wall insulation has been defined throughout this report as internal or external wall insulation installed through Government programmes Carbon Emissions Reduction Target (CERT) or Energy Efficiency Commitments (EEC1, EEC2)

      In addition in April 2008, about 900 thousand homes are known to have other forms of non-cavity wall insulation that fall outside this definition of solid wall insulation.”

      2) You also wrote: “those who haven’t had them done have chosen not to do so for a reason,” suggesting home owners who haven’t yet insulated their cavity walls or lofts are unlikely to change their minds.

      But the DECC statistics seem to query this, since they show rising numbers of cavity wall and loft insulations in the quarter before the statistical report came out in 2011:

      “The number of cavity wall insulations in the last quarter increased from 112,000 to 170,000, a rise of 52 per cent and is a third higher than the number installed in the same quarter last year.

      The number of professionally installed loft insulations in the last quarter more than doubled from 112,000 in the previous quarter to 251,000 and is 52 per cent higher than the number installed in the same quarter last year.

      The number of DIY loft insulations in the last quarter halved from 171,000 to 83,000 and is one fifth of the amount installed in the same quarter last year, although delivery between Jan-Mar 2010 was unusually high.

      The number of solid wall insulations in the last quarter was 4,000, twice the level of the previous quarter but 42 per cent lower the number installed in the same quarter last year.”

      It looks as if the programmes to support home insulation out of public funding and energy company subsidies to customers were pretty successful – which raises the question, if it ain’t broke, why fix it?
      The answer seems to be: it’s an ideologically-driven policy to cut publicly- funded home energy efficiency improvements, and replace that successful policy with a market based policy where the individual pays. Like the rest of this government’s cuts-driven policy agenda.

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