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Green Deal – Challenges and Opportunities
Steven HeathExternal Affairs Director
First some context?
.. Europe’s Energy Bill..
€400 Billion a year
€270 bn of this can be saved with existing cost effective technology…
That’s;3 million barrels of oil a day460 million tons of CO2 a year*
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*Ecofys VII report for Eurima
408/04/23
… more energy is used in buildings than in transport or industry
UK’s share = £3bn** - £7bn a year (household and business waste)
** DECC (2010) Green Deal Summary proposals
My house = £577 of £3bn
Roof
Windows
Floor
Chimneys
Walls
Heating System
=
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The cost of upgrading the UK’s existing housing stock
Circa £7bn−£11bn per year over the next 15 years*
My house – c£12,000 - £15,000
ECO spending circa £1.3bn.
* E3G Financing the Green Deal
So what is Green Deal?
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Green Deal Energy Company Obligation
• Commercial loan, tied to electricity bills to provide energy saving measures
• Primarily for low income and vulnerable households who cannot afford Green Deal
• Also for ‘hard to treat’ households who cannot afford financing solely through the Green Deal
The Green Deal offer to customers
Customer Journey
An impartial Green Deal assessor recommends measures specific to your house
You choose what improvements you have (Insulation, boiler etc) A Green Deal Provider manages the install of measures You pay back instalments through your energy bill The amount you pay back each month has an upper limit fixed to
the amount the assessment says you will save - THE GOLDEN RULE
Loan stays with the property not you (the occupant is not credit checked with the ambition being to have a common interest rate for all)
What does success look like?
Finance?Supply chain?Customer (Private)?Customer (Stock owner)?Customer (Commercial)?
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How do we get there?
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Supply chain?
single measure delivery whole house solutions
Theoretical performance real performance
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Supply chain - Opportunities for installers
Green Deal Measures - opportunities Loft insulation Rafter insulation Cavity wall insulation Solid wall insulation Floor insulation
Massive opportunity in solid wall insulation 7 million homes in UK housing stock Current install rate of circa 30k per year Major uplift needed to hit carbon reduction targets Installation capacity needed to allow uplift ECO funding – carbon target element includes solid wall insulation
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Opportunities for installers with KI
Knauf Insulation training ThermoShell Internal Wall Insulation ThermoShell External Wall Insulation Cavity Wall Insulation
ThermoShell Training Academy Birmingham Theoretical and Practical facilities
On-site support Regional Technical Managers
Details & contacts www.thermoshell.co.uk
Customers? Stock owners
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What can RSLs / LAs do to get best value for their tenants?
Economies of scale
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Easier to meet golden rule
Installation Costs
Product costs
Finance Costs
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Why limit the economies of scale to your stock?
UK domestic building stock26.7m homes in Great Britain23m have lofts 18.8m have cavity walls7.8m have solid walls
How many private properties would benefit from new windows, doors, roof repairs, boilers, re-rendering programmes nearby your stock?
We as a company are being forced to look at our business model under Green Deal;
The construction industry to date is siloed with few links between supply chains – if ‘whole house’ solutions are to succeed this must change.
As one of the main customers of Green Deal, RSLs and LAs must also look at their business models – their worst performing stock may now prove to be an important asset;
What’s your business model?
RSL approach to retrofit
1. At the very least – Green Deal / ECO offer the chance to improve the energy performance of that home
2. At best – the programmes offer RSLs GD provider or installer business models or even investment opportunities with sustained paybacks; possibly even partial freedom from unpredictable and intermittent Government grant funding cycles (with no limit like FITs)
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Knauf Insulation Contacts
Cavity Wall Insulation – Chris Nicholls 07553 354 [email protected]
External Wall Insulation – Kevin O’Keefe 07501 727 [email protected]
Internal Wall Insulation – Craig O’Donnell 07739 446 412Craig.O’[email protected]
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