ECO and the Green Deal

Transcription

1 ECO and the Green Deal PROGRESS TO DATE; THE IMMEDIATE OUTLOOK; AND WHAT NEEDS TO HAPPEN

2 Progress to date And immediate outlook following proposed cuts to the Energy Company ObligaHon

3 Major measures delivered by Green Deal Finance, Cashback and ECO These slides focus predominantly on major measures ; i.e. those that conshtute most of the work carried out. These are: Efficient boilers Cavity wall insulahon (CWI) LoS insulahon (LI) Solid wall insulahon (SWI) Most of the following slides show month by month delivery of the above measures, from January 213 to March 214.

4 Major measures delivered by Green Deal Finance, Cashback and ECO 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Boilers CWI LI SWI

5 Programme delivery in historical perspective about which more later 3,, 2,5, 2,, Green Deal and ECO: much momentum lost, and set to worsen this financial year due to cuts 1,5, 1,, 5, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Boilers CWI LI SWI

6 Green Deal Finance and Cashback Progress to date

7 Major measures delivered by Green Deal finance 6 7, Number of Green Deal major measures Worth nohng that other measures have featured strongly in Green Deal Finance: HeaHng controls Solar photovoltaics However, from here, we shck to the original four major measures 6, 5, 4, 3, 2, 1, Number of Green Deal webpage views on Gov.uk Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Boilers CWI LI SWI HeaHng controls Solar PV Number of Green Deal Webpage views on Gov.uk

8 Major measures delivered by Green Deal finance 6 7, Number of Green Deal major measures ,17 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 End of June: Green Deal mired in IT and legal problems It End looks of January as if interest 213: has Governmentbacked markehng campaign been declining launches 17,836 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Boilers CWI LI SWI Number of Green Deal Webpage views on Gov.uk 6, 5, 4, 3, 2, 1, Number of Green Deal webpage views on Gov.uk

9 Major measures delivered by Green Deal Cashback 1,8 1,6 1,4 1,2 1, 8 Mid-February: SWI cashback increased from 65 to 4,; back-dated to mid-december Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Boilers CWI LI SWI

10 Energy Company Obligation (ECO) Progress to date and immediate outlook

11 Progress to date under ECO Next slides examine ECO as a whole, and then its conshtuent parts: Carbon Emissions ReducHon ObligaHon (CERO) Carbon Saving CommuniHes ObligaHon (CSCO) Home HeaHng Cost ReducHon ObligaHon (HHCRO) Latest official data from DECC and Ofgem are used (to March 214). Post March 214, we look at the impact of changes proposed in the current ECO consultahon, and compare this with what would have happened were the ECO les unchanged

12 Major measures delivered by ECO without changes 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Required monthly rate to March 215 Boilers CWI LI SWI

13 Major measures delivered by ECO consultation changes 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Required monthly rate to March 215 Boilers CWI LI SWI

14 Major measures delivered by CERO without changes 7, 6, 5, 4, 3, 2, 1, CERO achvity has ramped up to the level it would need, approximately, to sustain in order to meet its original March 215 target 7% 15% 27% 33% Boilers CWI LI SWI % of 215 target

15 Major measures delivered by CERO consultation changes 7, 6, 5, 4, 3, 2, 1, The level of achvity in the first quarter of 214 increased dramahcally to take advantage of the levelisahon upliss proposed by the consultahon. This compounds the reduchon of CERO targets and means very liple will occur unhl at least April % 35% 63% 78% Boilers CWI LI SWI % of 215 target

16 Major measures delivered by CSCO without changes 35, 3, 25, 2, 15, 1, 22% 25% 19% 5, 13% Boilers CWI LI SWI % of 215 target

17 Major measures delivered by CSCO consultation changes 35, 3, 25, 2, 15, 1, 5, 14% CSCO is the only part of ECO that will see any significant level of achvity between now and March 215 2% 24% 27% Boilers CWI LI SWI % of 215 target

18 Major measures delivered by HHCRO 4, 35, 3, 25, Mostly boiler replacements, averaging 1.2 measures per household helped HHCRO well ahead of schedule to meet targets. This is why it starts to wind down level of achvity 77% 81% , 15, 1, 5, 16% 44% Boilers CWI LI SWI % of 215 target

19 Relative contributions to date From Green Deal Finance, Cashback and Energy Company ObligaHon placed into longer term context of previous programmes

20 Relative contributions: Green Deal Finance 4 35 Total number of major measures Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Green Deal Finance

21 plus Green Deal Cashback 1,8 1,6 Total number of major measures 1,4 1,2 1, Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Green Deal Finance Cashback

22 plus ECO. 9, 8, Total number of major measures 7, 6, 5, 4, 3, 2, 1, Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Green Deal Finance Cashback ECO

23 Delivery since 2: loft insulation 1,2, 1,, 8, 6, An 87% drop in los insulahons, even though 7.5 million loss remain underinsulated 4, 2, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Warm Front EESOP-3 EEC-1 EEC-2 CERT CESP ECO & GD

24 Delivery since 2: cavity wall insulation 9, 8, 7, 6, 5, A 46% drop in cavity wall insulahons, even though over 5 million homes could shll benefit 4, 3, 2, 1, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Warm Front EESOP-3 EEC-1 EEC-2 CERT CESP ECO & GD

25 Delivery since 2: boilers 1,, 9, EEC-2 was an important facilitator in the transihon to condensing boilers 8, 7, 6, 5, 4, The incenhve structure under HHCRO to date has meant that boilers have been the simplest way of achieving its target 3, 2, 1, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Warm Front EESOP-3 EEC-1 EEC-2 CERT CESP ECO & GD

26 Delivery since 2: solid wall insulation 8, 7, 6, Long project set-up Hme under CESP led to spike to reach target in its last year Momentum being lost; 8 million untreated solid wall homes remain 5, 4, 3, 2, 1, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Warm Front EESOP-3 EEC-1 EEC-2 CERT CESP ECO & GD

27 All major measures across the programmes 3,, 2,5, 2,, 1,5, DriSing further away from what is needed, and what is possible 1,, 5, 2/1 21/2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 212/13 213/14 214/15 Boilers CWI LI SWI

28 What needs to happen MeeHng Carbon Budgets and dealing with fuel poverty

29 On reducing CO 2 emissions To meet carbon budgets, the Commipee on Climate Change requires all remaining cavihes and loss to be insulated by 215, and 2.2 million solid walls to be insulated by 222* * 213 Progress Report to Parliament, Chapter 3, Sec:on 3

30 Monthly install rates to meet carbon budgets 3, 25, 2, 15, 1, 5, - InstallaHon rates seen under CERT, CESP and Warm Front 133,886 53,7 Average monthly rate in 212 InstallaHon rates seen under ECO and Green Deal so far 23,457 21,296 13,839 13,571 6,84 4,387 1,249 Average monthly rate to March 214 InstallaHon rates likely as a result of the cuts proposed; new GD Home Improvement Fund could drive an addihonal 2, SWIs per month. But this would only make up 15% of the carbon savings lost to the ECO cuts Likely average monthly rate to March 215 (ECO only) LI CWI SWI Without ECO cuts and without GD Home Improvement Fund, these monthly rates would have been expected to March 215 3,759 49,348 8,23 Rate required without cuts Monthly rates needed to meet carbon budgets (to end 215 for LI and CWI, and to end 222 for SWI) 243, ,696 2,478 Monthly rate required to meet CCC trajectories

31 On tackling fuel poverty The Energy Bill RevoluHon is calling for all low-income homes to be upgraded to an Energy Performance CerHficate rahng of Band C by 225 that means 5.9 million homes from now

32 On tackling fuel poverty Achieving Band C by 225 means: Deep retrofits Wide range of energy efficiency improvements Doing so at an ambihous, but achievable rate

33 Depth of retrofit in low income households Average number of measures per household HHCRO and CSCO depth of retrofit Required depth of retrofit to meet Band C

34 Depth of retrofit in low income households ECO is very much a single measure programme, with low income households supported receiving on average 1.2 measures each Deeper retrofits are needed, averaging 3.1 measures per low income household supported, if Band C is to be met Also, the range of measures ECO delivers is too narrow

35 Composition of retrofit in low income households Boiler LoS InsulaHon HTTC CWI HeaHng Controls Standard CWI Solid Wall InsulaHon Draught Proofing Hot Water Cylinder InsulaHon Window Glazing Flat Roof InsulaHon Electric Storage Heaters Door InsulaHon Solar Water HeaHng Photovoltaics Micro CHP Ground Source Heat Pumps Biomass Boilers Air Source Heat Pumps 2, 4, 6, 8, 1, 12, 14, Required each month to reach EPC Band C by 225 for low income households in England Seen to date per month under ECO (eshmate for low income households in England only)

36 Composition of retrofit in low income households As could be seen, low income households not only need deeper retrofits, but also require a much wider mix of measures to meet Band C See our Ending Cold Homes report* for Consumer Futures (now CiHzens Advice) *Click cover to open the report on the ACE website

37 Reaching low income households 6, 5, 4, We eshmate 46, low income households helped in Britain in first 15 months of ECO, of which 98, in fuel poverty ECO set to conhnue at a similar rate to March 215. Lower number of low income households that will be helped by HHCRO and CERO likely to be offset by catch-up necessary for CSCO Without cuts, CERO would have helped considerably more low income households in the next 12 months. Were the ECO to conhnue unhl 222, 64, fuel poor households would receive help. Helping all low income households to reach an EPC rahng of C by 225 doesn t require that many more low income homes to be reached. But it would help many more fuel poor households (3.1m to 225), and provide more lashng support through deeper retrofits 3, 2, 1, - Average monthly helped to March 214 Likely average monthly rate to March 215 (ECO only) Rate it would have been to March 215 Monthly rate required to meet EPC Band C trajectory Low income households of which fuel poor

38 Reaching low income households So, the ECO supply chain is almost going into enough low income homes, compared to the number that need to be reached to reach Band C by 225; this is encouraging, however: It is currently an opportunity missed, because low income households are not receiving the depth or the range of support necessary to fuel poverty proof their homes

39 Conclusions Green Deal Finance and Cashback have contributed liple to retrofits, compared to ECO. ECO is delivering much less than previous programmes To cut carbon emissions at scale and speed required and to end fuel poverty more capital investment is needed to achieve deep retrofits. The Energy Bill Revolu8on is calling for: Home energy efficiency to be made a UK infrastructure priority 2 million low income homes given free measures to bring them up to EPC Band C by 22 and all low income homes brought up to EPC C by 225 Low interest loans for able to pay Use carbon revenue to provide long term funding

40 About the Energy Bill Revolution The Energy Bill RevoluHon is an alliance of 18 charihes and businesses campaigning to end fuel poverty by making home energy efficiency a UK priority infrastructure investment. They are calling for all low income homes to be made highly energy efficient and for carbon tax revenue to be used to provide long term funding. For queries, contact Ed Maphew, Director at ed.maphew@e3g.org

41 About the Association for the Conservation of Energy The AssociaHon for the ConservaHon of Energy was formed in 1981 by a number of major companies achve within the energy conservahon industry. Our aim is to encourage a posihve nahonal awareness of the need for and benefits of energy conservahon, to help establish a sensible and consistent nahonal policy and programme, and to increase investment in all appropriate energy saving measures. ACE Research is an independently funded and internahonally respected research unit which has consistently delivered groundbreaking policy research. Its work ensures that ACE s campaigns and advocacy are always founded on, and guided by, the best available evidence and insight. For queries, contact Pedro Guertler, Head of Research at pedro@ukace.org