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How efficient are energy efficiency schemes? (Jun12)

 I wrote this article in June 2012 but am only posting it on my blog on 1st October, in advance of the introduction of the Green Deal.  It seems that this government initiative is not being welcomed with open arms – I’m not surprised.  I think that there’s ample room for improvement with Energy Performance Certificates too.
If you’re buying, selling or renting a property, do you take account of its energy efficiency?  Most people don’t.  But, perhaps this should be higher up our list of concerns.  Not only can it make a significant different to the running costs of our properties but efficient systems are better for the environment too.
Given that nearly half of all energy used in this country is through buildings – more than industry and transport put together – this issue needs tackling.  The government are on the case, but my own experience leads me to question whether what they’re doing is good enough.
I’m particularly concerned about the benefits of Energy Performance Certificates (EPCs), which have been required by the EU for every home that is either let or sold, since 2007.  This gives a property an ‘A’ to ‘G’ rating for energy efficiency ‘A’ being the most efficient and ‘G’ the least.  The Certificate includes recommendations on improving the efficiency of your property, as well as what’s the best you can achieve, for the type of property you have.
The main problem with EPCs is that the approach is too generic, which means energy assessors can’t take account of the individual differences between properties.  They have a tick box form to complete and the results are processed by centralised software.  This means that many energy efficiency improvements can’t be included in the analysis.   And what’s worse is that if they can’t see that insulation, for example, has been installed, they simply put a cross in the relevant box – and it’s not included in the rating.
I recently eco-renovated my London flat from top to bottom, doing almost everything I could think of to make it energy efficient.  So, I was surprised to get an ‘E’ rating in the EPC assessment.  It transpired that the assessor had ignored the internal wall insulation, the state of the art heating controls, supplied by Honeywell, and the LED energy-efficient lighting throughout.   I asked for the report to be re-done and my rating improved to a ‘C’ – but if more of the things I’d done could have been included, it would have been even better.
Furthermore, the information and recommendations in the report I received were light-weight and in some cases inaccurate.  For example, it said that I could reduce emissions further by switching to renewable energy sources.  But my East and West facing roofs don’t get enough sun for solar power, particularly given that they’re shaded by chimneys.  Wind power didn’t make sense either. And these were the only two possible renewables to consider.
Andrew Warren, Director of the Association for the Conservation of Energy, points out that the government are ‘trying to deliver EPCs on the cheap’.  He said that charges are kept low because everyone is obliged to have one carried out, but that if you don’t pay much – mine cost £60 plus VAT – you can’t expect to get top rate assessors or very detailed information.
 Russell Smith from Parity Projects, a company that advises on home energy management, shares this concern.  He says that ‘there’s a cost tension between the amount, and complexity, of data you can collect and produce and the quality of people that will do this – it can’t be too complicated’.   Mr Smith’s company provides more detailed assessments for householders but will charge a considerably more to do this.  He also points out that an EPC is not supposed to give people advice on what to do – it’s merely useful in comparing one property with another.
But I talked to a number of estate agents who universally said that none of their customers asked to see the EPC on properties they were renting or selling.  One agent said “I rent 20 to 30 flats a week and no tenant has asked to see the EPC – people couldn’t care a less, they simply go for a property that they like the look of’.  Another agent explained that property owners simply didn’t know what EPCs were – and many people confuse them with safety certificates for gas and electrics.
The hope is that this will change.  Lucy Darch, Energy Director at uSwitch.com, which gives impartial advice on which energy company to use, says that EPCs could help motivate landlords to make energy efficiency improvements.  She pointed to an example, where University students were choosing to live in newly renovated energy-efficient properties, rather than leaky Victorian houses – recognising the benefits of cheaper energy bills.
Currently, however, there’s not much incentive for landlords to improve the energy efficiency of properties they let, as they’re paying for these measures whilst tenants get the benefit of lower fuel bills.  This conflict of interest is reflected in the number of private rented properties that are the worst energy performers.  Whilst one in six households are privately let – that’s 16.66% – 58% of ‘G’ rated properties are from this sector.
In 2018 all rented property will have to have an energy-efficiency rating of ‘E’ or above – an ‘F’ or a ‘G’ rating would mean landlords had to make improvements before being able to let out their property.   But Andrew Warren asks ‘why wait until 2018 for this measure, when over half of such properties have new tenants every two years?’.
These are not the only changes afoot.  In October 2012, the government are introducing the Green Deal.  This is another initiative aimed at reducing carbon emissions from buildings.  The central idea is to offer financing deals that means consumers ‘pay as they save’ – essentially paying back loans for energy-efficiency measures through savings on energy bills.
The key problem with this approach is that it’s complicated and I’m not the only one who is sceptical that anyone but experts will actually understand it.  The first step is to work out whether planned improvements will reduce overall energy consumption to a greater extent than the charge on your electricity bill.  This is known as the Golden Rule.
On my flat the EPC suggested that insulation would cost between £4000 and £14,000 and would save a paltry £31 per annum in energy bills.  If this money had been loaned to me, that would mean it would take between130 and 450 years to pay it back – not including interest.  Clearly, that wouldn’t conform to the Golden Rule, which makes me wonder what measures would be eligible and whether costs will almost always outweigh savings.
Another concern is that under the Green Deal, property owners are limited in their choice of contractor – they have to use accredited companies.  So if you’re a DIY enthusiast, or simply want to use a builder that’s not signed up you won’t get any Green Deal funding.
David Frise from Building & Energy Services, which represents plumbing and heating contractors says ‘Most installers are accredited to death, I think the really competent ones won’t bother to register as Green Deal contractors’.   His concern is that there’s too much bureaucracy in the process.
Having seen the flawed EPC on my flat, I was very sceptical about their value in promoting energy-saving – and I’m not convinced the Green Deal is going to be any better.  However, many of the energy experts I spoke to have high hopes for the scheme.  David Strong, a sustainable building guru and Chair of a Government Advisory Panel on the Green Deal, sums it up by saying “if you’re going to be critical of EPCs and the Green Deal, you should ask yourself what else can be done to drive the market towards greater energy efficiency.
My answer to him is that there’s a lot more work to be done.  EPCs need to be accurate and flexible enough to cover more than basic energy efficiency measures.  Assessors should ask property owners to provide information before they visit, so they know what to look for.  And training should be more rigorous.
There should also be more compulsion for energy efficiency improvements to the most inefficient buildings.  Certainly the deadline for landlords to up-grade their properties should be brought forward from 2018.
Finally, one important element that’s missing from these schemes is consumer behaviour.  The property you live in could meet top of the range energy-efficiency standards, but if you leave the heating on day and night, leave the windows and doors open and don’t turn electrical equipment off, you could still be using more energy than someone living more carefully in a very inefficient building.
So we all have a responsibility to take more notice of the energy-efficiency of buildings.  We may not get to grips with EPCs or the Green Deal but that’s no excuse for not making energy efficiency improvements.  If we wait for the government to sort things out, we may be waiting some time.

7 thoughts on “How efficient are energy efficiency schemes? (Jun12)

  1. David says:

    Very good post about the flaws re EPCs. As a provider it is very frustrating to see reports that are incorrect, as ever you get what you pay for. The EPC was updated in April, more info can be included. as you said this needs to be asked for by the DEA. Until the EPC is valued and promoted sellers will look to find the cheapest, but remember your local DEA will be in most cases offer a good price compared to estate agents.

  2. Benjamin Romero says:

    Energy efficiency training is becoming increasing popular in many organizations, companies, and enterprises. While most plant facilities managers and staff, and even other team members aren’t exactly excited about it, most companies today and in the near future are arranging for their staff to participate in energy efficiency management solutions and training. Energy management Software review

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