Things to come - Gerry Miller, CIGA / SWIGA


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Things to come - Gerry Miller, CIGA / SWIGA. Big Green Deal event, 16th September 2011 Aylesbury

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  • Measure numbers fall, but lower number of higher value installations
  • Could create a market worth over 2bn by 2020
  • Could create an additional 10,000 Jobs
  • Maintained CO2 savings
  • Industry doing our bit
  • Things to come - Gerry Miller, CIGA / SWIGA

    1. 1. Gerry Miller<br />Things to Come<br />
    2. 2. Where are We Starting From?<br /><ul><li>Existing framework based on CERT/Warm Front/CESP has delivered successive step changes in insulation activity - but market dominated by subsidized offers</li></li></ul><li>Remaining Potential<br />
    3. 3. What needs to be done?<br /><ul><li>Potential for Easy Cavity Wall and Loft Insulation installations remains but is finite
    4. 4. Focus over coming years will shift to harder to treat properties including 6.6m with Solid Walls.
    5. 5. Involve inherently more complex, diverse, disruptive and costly treatments
    6. 6. CC Targets imply that that 2.3m Solid Walls will need to be treated by 2022 - a 10 fold increase
    7. 7. Requires considerable industry Investment in developing solutions, training and scaling capacity</li></li></ul><li>Where will it come from?<br />
    8. 8. Green Deal Ambition<br />Government see Green Deal as a “Game Changer” that will transform the UK’s housing stock<br />14 million homes to be assisted by 2020<br />Support 100,000 Jobs by 2015 and 250,000 when activity reaches peak<br />Integrated with an Energy Company Obligation focused on the dual objectives of Fuel Poverty and Carbon savings. <br />Delivered by strong National brands and Local knowledge and innovation<br />
    9. 9. Things to Come<br />
    10. 10. What Could Success Look Like?<br /><ul><li>A successful transition to a combined ECO/GD could deliver real benefits
    11. 11. Increasing levels of insulation activity
    12. 12. Deeper inroads into Alleviation of Fuel Poverty
    13. 13. Neighbourhood and Housing stock improvements
    14. 14. Development of thriving local businesses
    15. 15. Creation of local Employment
    16. 16. Delivery of Carbon savings
    17. 17. Product Innovation</li></li></ul><li>Measures Installed<br />
    18. 18. Value of market<br />
    19. 19. Employment<br />
    20. 20. Lifetime CO2 Savings<br />
    21. 21. The Cost of Getting it Wrong<br />Getting it wrong could result in <br />a meltdown in current CWI and LI activity and loss of Jobs<br />Failure to develop the necessary investment in expanding Solid Wall capacity<br />Increase in Fuel Poverty over BAU and reduced consumer non fuel spending<br />Failure of Building sector to achieve CC goals. <br />
    22. 22. strengths<br />Creates a socially equitable model to drive higher cost energy efficiency improvements.<br />Embodies a holistic ‘whole house’ approach to treating buildings<br />Provides a real opportunity to improve the building stock and local neighbourhoods.<br />Offers help to those in Fuel Poverty<br />Delivers Carbon savings to meet CC targets<br />Carries Government endorsement<br />ECO element will provide some certainty over expected installation rates<br />
    23. 23. weaknesses<br />Over half of potential activity likely to be in ATP sector addressed by GD rather than ECO<br />Market basis means no formal GD targets to give investment signals or track performance<br />No planned transition - Construction is like a super-tanker – it takes time to turn and switch capacity into Solid Wall insulation<br />Does not address risk of activity being stifled by building control and planning issues<br />Lack of clarity over ECO GD interaction mechanism<br />ECO represents a significant increase in cost to consumers, possibly £1.8bn pa or 10% of bills<br />
    24. 24. opportunities<br />Could create significant opportunities for local businesses<br />Could allow development of a Sustainable free market for Insulation<br />Could catalyse creation of innovative delivery partnerships and mechanisms<br />Market basis could drive innovation and allow differentiation of Products and Services<br />
    25. 25. Threats<br />Lack of demand certainty under free market GD<br />Uncertainty over which particular Measures will be promoted in GD packages <br />Exclusion of ‘Able to Pay’ CWI and LI from ECO will damage industry, reduce carbon savings and push up costs suppliers pass to consumers<br />Entry of new players not experienced in building fabric measures could result in poor quality workmanship, seriously damaging consumer confidence<br />Golden Rule could drive cost & performance down, rather than encourage innovation<br />
    26. 26. Threats<br />Slow uptake from consumers conditioned to subsidised insulation offers<br />Risk of transaction costs making effective, low cost, measures such as CWI unattractive to providers and consumers.<br />Risk of loan rates leaving no benefit for consumers<br />Fears of default fears concentrating activity in low risk areas<br />Risk of dominance by major players or Financial Institutions sucking value out of supply chain<br />Risk of Energy Companies using ECO funds to control access to GD packages<br />
    27. 27. Key factors for success?<br /><ul><li>Clear ‘targets’ and effective design and integration of ECO/GD to maintain current activity in the transition and drive investment in Solid Wall training & capacity.
    28. 28. Wide access to ECO funds to allow engagement of all delivery channels and range of local businesses
    29. 29. Building Consumer confidence and demand:
    30. 30. Communications programme
    31. 31. Robust Quality Assurance frameworks from day 1
    32. 32. Range of competing propositions
    33. 33. Involvement of trusted local partners </li></li></ul><li>What Is Industry Doing?<br />NIA Engagement with Government regarding development of key policies<br />Research to validate remaining insulation potential and determine sustainable timelines and trajectories for main measures<br />Work to develop solutions to non standards cavities<br />NIA and CIGA Creation of Solid Wall Insulation Guarantee Agency and framework to Guarantees SW work meeting technical requirements.<br />Builds on Proven Cavity model which saw CWI activity safely increase 5 fold<br />
    34. 34. SWIGA Framework<br />
    35. 35. SWIGA Summary<br /><ul><li>Comprehensive; covers all suitable property types and Internal, External or Hybrid Systems
    36. 36. Provides assurance that work will be carried out correctly, as Framework aims not just to sort out problems - but prevent them
    37. 37. Multi tier checks backed by independent surveillance
    38. 38. Helps ensure consistent In Situ performance to support Golden Rule
    39. 39. Simple, Guarantee covers defects in materials and workmanship and not restricted to installer insolvency
    40. 40. Integration with CP scheme to ensure B Regs compliance</li></li></ul><li>The Role of Local Auth<br />Perceived as Trusted partners – loft programmes of 1980’s<br />Scope to develop innovative propositions, integrate Fiscal incentives based on Council Tax etc.<br />Simplification of Building Control and Planning constraints.<br />Detailed knowledge of local building stock<br />Existing Relationships and networks with local contractors<br />Synergies with HECA commitments<br />Potential access to low cost finance<br />
    41. 41. Conclusions<br />Green Deal offers the potential to deliver major benefits<br />Must be designed correctly and accessible to range of providers<br />Local Authorities have a natural role to play and CIC construct provides <br />Critical mass to allow effective competition with major Brands.<br />Sharing of best practice<br />Scope for joint Communications<br />Additional route to market for Contractors<br />