Energy efficiency and domestic renewables

What works and how to fund itDavid White ACA, MSc Renewable Energy and

the Built Environment (CAT)

22 November 2011

Content

• A bit of context and the scale of the challenge• Free and low cost energy efficiency measures• More expensive energy efficiency measures• Current sources of funding and advice• The Green Deal• The Feed-in Tariff scheme• The Renewable Heat Incentive scheme• Transition Town West Kirby Energy Group

Aims

• To highlight some of the ways in which you can save energy and reduce your bills

• Where you might get funding for energy efficiency measures – now and in the future

• Point you towards sources of reliable information• No marketing or selling of services• NOT specific advice – depends on individual

circumstances

A bit of context

• UK Government has set a legally binding target of an 80% cut in carbon emissions by 2050

• Through our use of gas and electricity, the UK’s homes are responsible for around a quarter of the UK’s carbon emissions

• Emissions from homes need to be near zero by 2050• Around 80% of the houses standing today will still be in

use in 2050 – almost all will need refurbishing• This equates to refurbishing a house every minute for

the next 40 years

The state of our homes

• There are around 26 million homes in the UK (ex. NI)• Amongst the oldest and least energy efficient homes in

Europe• We spent £33 billion pounds on heating and lighting our

homes in 2010

We have a lot of old houses

Millions

Measuring the energy efficiency of our homes Energy Performance Certificates

EPC ratings of UK homes

EPC rating and energy bills

• Average Band G energy bill - £2,200 per year• Average Band B energy bill - £530 per year• Moving from a Band D to a Band B is likely to halve your

annual energy costs

What does a Band B home look like?

• For a 1950s semi-detached house:– Loft insulation to depth of 270mm– Cavity wall insulation and internal insulation– Ground floor insulation– High performance double glazing– Either condensing combi boiler or condensing boiler with well

insulated water tank and pipework– 100% dedicated low energy efficient fixed light fittings

All of which adds up to a substantial bill and lots of disruption if you wanted to do all of these things

Rising domestic energy bills

Combined gas and electricity bills have almost doubled since 2003

Where do we use energy in our homes?

What influences how much energy we use in our homes?

• Type of property – detached, semi, terrace, etc.• How old/draughty/insulated it is• The fuel used to heat the house – gas, electric, other• Efficiency of your boiler – type and controls• How many people live in the property• The age of the people living in the property• How you use your home

– Occupancy - in during the day or at work?– Behaviour - turning lights off, thermostat temperature, etc.

Points highlighted in red are areas you can influence

Free and low cost energy efficiency measures(by no means an exhaustive list!)

The Energy Saving Trust estimates some people could save 25% of their energy bill through low and zero cost energy efficiency measures

Savings are per

year

More expensive energy efficiency measures

Take advantage of and preserve opportunities

• If undertaking home improvements, use the opportunity to install energy efficiency measures– Install internal wall insulation when replacing kitchen or

bathroom fittings– Install mixer shower if replacing old electric shower

• Also worth preserving opportunities– Extend eaves when re-roofing to allow for future

installation of external wall insulation– Postpone window replacement and install alongside solid

wall insulation

Current sources of funding for energy efficiency measures

• Warmer Wirral – 0800 512 012– Open to all Wirral residents– Provides free cavity wall and loft insulation (if <150mm)

• Energy Saving Trust – 0800 512 012– Has a grants and discount database by postcode– What’s available largely depends on your circumstances– Strongly recommend calling them for free, impartial advice

• Your energy supplier– May offer other measures for qualifying households

Current sources of funding for energy efficiency measures (cont.)

• Warm Front – www.direct.gov.uk– Government scheme aimed at people on certain income-related

benefits – Funds improvements costing up to £3,500

• CosyLoans – www.wirral.gov.uk– Interest-free loans of between £200 and £2,000 from Wirral

Borough Council for homeowners and landlords– Funds specific energy efficiency measures

• Wirral Home Improvement Agency/Handyperson Service– Some limited financial assistance for property repairs– Handyperson service for elders and vulnerable people– Contact number 0151 691 8090/691 8371

Houston, we have a problem…

• We need to refurbish 26 million homes and 2 million industrial buildings by 2050, preferably sooner

• Estimated cost of £400 billion• Upfront cost is seen as a major barrier by

householders, particularly in the current economic climate

• The Government’s proposed solution is the ‘Green Deal’, due to be launched in Autumn 2012

How does the Green Deal work?

• Still waiting for the consultation document to be published, so this could all change!

• In a nutshell, it’s a Pay-As-You-Save scheme:– You will be able to install a suitable package of measures at

no upfront cost to you, using a loan of up to £6,500– Repay the loan over 20-25 years using the savings you

make on your energy bill– The savings you make must be more than the cost of the

loan (the ‘Golden Rule’)– If you move out, the loan stays with the property not you

Looks a bit like this…

£1,000

£700

£200 Green Deal charge

Annual energy bill after Green Deal

package

Current annual energy

bill

How do you get a Green Deal?

And there’s more help for those that need it…

• An Energy Company Obligation (ECO) will also be introduced as part of the Green Deal

• Will be used as:– A subsidy of up to £3,500 (or more?) which is added to the

Green Deal loan to help pay for more expensive measures, e.g. solid wall insulation

– Or will subsidise the cost of a Green Deal package for those who can’t afford to heat their home properly and may not see any savings on their energy bills after Green Deal measures have been installed

Feed-in Tariff scheme (FITs)

• Introduced in April 2010 to encourage the uptake of small scale renewable electricity generation

• Photovoltaics (PV), aka ‘solar panels’, have been by far the most popular technology due to:– Level of financial return and ease of installation, e.g. don’t

usually need planning permission for standard domestic installations

– FITs payment is guaranteed for 25 years, tax-free and index linked

Level of tariff to be cut from 12.12.11

• Government recently announced a 50% cut in the tariff for PV:– Will pay 21p/kWh for systems accredited on or after 12

December instead of 43.3p/kWh– New rate intended to provide a return on investment of

4.5%-5.0%– Government is currently consulting on whether homes

need to meet a minimum standard of energy efficiency before qualifying for this rate

– One suggestion is a home will need to be in Band ‘C ‘or better, otherwise will only get 9p/kWh

– This new requirement coming into force from April 2012

Is PV still a good idea?

• From a financial perspective, depends on a number of factors:– How good is your site? Orientation? Shading? Roof size?– How much the system costs to install– How long you plan on living in the property– How sunny it is!

• From a carbon saving perspective?– Reducing energy consumption first almost certainly more

carbon (and cost) effective, e.g. insulation– If you’ve already done lots of energy efficiency measures

then definitely worth considering

The Renewable Heat Incentive (RHI)

• A new incentive scheme being introduced alongside the Green Deal next year to support domestic scale renewable heat generation

• Technologies covered by the scheme likely to include biomass boilers, solar thermal, ground and air source heat pumps

• For the time being, the Government has introduced the Renewable Heat Premium Payment, which provides a voucher towards the cost of installing some technologies

Renewable Heat Premium Payment (RHPP)

Technology RHPP voucher

Typical cost of domestic system

Typical annual saving

versus gas

Annual carbon saving versus

gas

Solar thermal hot water £300 £4,000-5,000 £55 0.23 tonnes

Air Source Heat Pump £850 £6,000-£10,000 £130 0.80 tonnes

Ground Source Heat Pump £1,250 £9,000-£17,000 £130 0.80 tonnes

Biomass Boiler £950 £5,000-£12,000 £100 3.00 tonnes

• Once the RHI comes in, you should receive a payment for every kWh of heat you generate

• Currently don’t know how much the payment will be or how the scheme will work in practice

• Basically, other than the RHPP, all of this is TBC!

The Green Deal and renewable energy

• Nothing confirmed yet, but looks unlikely that you will be able to have renewables installed as part of a Green Deal package without covering most of the cost yourself

• All speculation at the moment, but the imminent consultation document should tell us what the Government’s current thinking is

Transition Town West Kirby energy group

• Currently, TTWK doesn’t have an energy group, but there are numerous examples of successful groups in other Transition Towns

• We’d like to launch one here if enough people are interested in getting involved

• If you are interested, please provide your contact details and we’ll be in touch

• If you’d just like to be kept informed about the group’s activities and events, then there’s an option for that as well

• We will not to pass your details on to anyone else

What sort of things have other energy groups done?

But it’s entirely up to those involved to decide what they’d like to do

Conclusions

• We face a huge challenge to refurbish our homes to a high standard of energy efficiency

• The Government is hoping the Green Deal will provide the answer

• There is some help out there• Contact the Energy Saving Trust for free, impartial advice• The FITs and RHI schemes will provide some support for

domestic scale renewable energy• TTWK would like to start up an energy group to help the

local community reduce its energy consumption (and bills!)

Thanks for listeningAny questions?