Taking Sustainabilityto the ConsumerThe CIMCIG Industry Report 2011Author: Chris Ashworth BSc (Hons) DipM FCIM Chartered M...
Introduction                                                  The last CIMCIG report “The Commercial Value of Sustainabili...
CIMCIG Research FindingsCIMCIG commissioned this research to gain         The opportunities for manufacturersa better unde...
The ReportThe Market“Marketing is the management process                  Traditionally marketers identify the            ...
Creating AwarenessThe first stage of the buyer decision            Additional key events for the Greenprocess, which will ...
EPCs were introduced in October 2008, at          But manufacturers and suppliers cannot                                  ...
Benefits                                          Functional BenefitsAs with any purchase decision the buyer              ...
Barriers                                                  We have seen that lack of knowledge                However behav...
Influencers                                        Segment 1: Positive greens                                             ...
Segment 2: Waste watchers                       Segment 3: Concerned consumers                                            ...
Segment 4: Sideline supporters                    Segment 5: Cautious participants14% of the population (5.6 million)     ...
Segment 6: Stalled starters                                                   10% of the population (4.1 million)         ...
Segment 7: Honestly disengaged18% of the population (7.4 million)“Maybe there’ll be an environmental disaster,maybe not. M...
Communication                                                                                                        Even ...
ConclusionsThe government is committed to the GreenDeal, but to achieve take-up a marketingapproach is needed to inform an...
Case Studies                                                   Creating the business opportunity                   Making ...
British Gas launches Home Energy Plan             Thinkinsulation.comBritish Gas launched the Home Energy              In ...
Appendix 1                                                   The Green Deal                                               ...
Financing the Green Deal                       Green Deal ImplementationInitial view on financing was that there       Tar...
Appendix 2Green Deal ImplementationGovernment Response to the Low Carbon Construction Innovation and Growth Team, HM Gover...
National Specialist        Provide Government with additional market sector intelligence to deliver                  Autum...
Appendix 3                                                   Behaviour Change and Energy Use                              ...
Cimcig taking sustainability to the consumer
Cimcig taking sustainability to the consumer
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Cimcig taking sustainability to the consumer


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Research to gain a better understanding of how the construction industry was responding to the opportunities to supply sustainable products and services to homeowners.

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Cimcig taking sustainability to the consumer

  1. 1. Taking Sustainabilityto the ConsumerThe CIMCIG Industry Report 2011Author: Chris Ashworth BSc (Hons) DipM FCIM Chartered Marketer
  2. 2. Introduction The last CIMCIG report “The Commercial Value of Sustainability” highlighted the opportunities of sustainability for the construction industry. Since then we have seen much progress, most recently with the publishing of the Government’s response to the IGT Low Carbon Construction report and last year’s announcement of the Green Deal. All of which represent opportunities for the construction industry. However CIMCIG remain concerned that the construction industry is not preparing itself to fully exploit this opportunity. We have recently conducted research amongst manufacturers and suppliers of products and systems that can make homes more energy efficient and found that in the short term only 21% of relevant manufacturers see Feed-In Tariffs as a very important opportunity and a tiny 8% of relevant manufacturers see the Green Deal as a very important opportunity. This is in an industry where there is still talk of a double dip recession. This report draws on some excellent work recently published to provide suggestions focused on the opportunities that the Green Deal will provide for companies who wish to develop this market. We hope it will provide inspiration and encouragement to take advantage of what has the potential to be the biggest opportunity for construction this decade.1 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  3. 3. CIMCIG Research FindingsCIMCIG commissioned this research to gain The opportunities for manufacturersa better understanding of how the construction presented by Feed-In Tariffs are seen asindustry was responding to the opportunities something for the future. While 73% ofto supply sustainable products and services respondents consider it to be an importantto homeowners. Research was conducted opportunity up to October 2012 only 21%amongst 100 manufacturers and 50 installers see it as very important within that timeidentified from the 2011 Ecobuild exhibitors frame and it is only after 2016 that 62%list and from web searches. consider it very important. This, despite 79% of manufacturers currently havingInterviews were conducted with Marketing products available for Feed-In Tariffs andor Commercial Managers. A disconnect a further 89% planning to develop products.was noted between the sales and marketingdepartments of some manufacturers, where Similarly, while 35% of manufacturersMarketing did not seem aware of the initiatives consider the Green Deal an importantbeing taken by Sales. Organisations also opportunity by 2012, only 8% see it asappear unclear as to what opportunities the very important and this only rises to 40%Green Deal represents for them and what after 2016. Although the Green Deal offersaction they should be taking. a wider product requirement, only 31% of manufacturers said they currently hadInstallers’ perceptions of the key benefits of suitable products available. Of those whotheir energy saving services to home owners do not have products available 69% arewere principally financially driven; either planning to develop some.reducing energy costs (33%) or generatingextra income (22%). Similarly, manufacturers While a similar proportion of installerssaw the principal benefit as reducing energy considering Feed-In Tariffs an importantbills (55%) and home energy generation (45%). opportunity, recognition of the opportunity presented by The Green Deal at 78% isMoney was ranked as the most important much higher than for manufacturers. Theissue to the home owner, followed by Renewable Heat Premium is also seen asreducing climate change and waste. an important opportunity by 40% of installers.Improved comfort and status with neighbourswere considered least important. Only one fifth of manufacturers have alliances with installers, or are planning alliances withWhen describing benefits to home owner installers to promote sustainable products.other phrases used by installers included; Of those that have had alliances, 79% have“financial help, trustworthy, after sales found them to be successful.service, convenient, advice, efficient,guaranteed, personal service and peace The full research can be downloaded fromof mind”. the CIMCIG website at: http://www.cimcig. org/library.php?id=218In terms of barriers to take-up of the GreenDeal, manufacturers identified negativeattitudes, resistance to change,inconvenience, mistrust, the long termnature of installations and lack ofunderstanding, awareness and enthusiasm. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 2
  4. 4. The ReportThe Market“Marketing is the management process Traditionally marketers identify the For the construction industry to succeedresponsible for identifying, anticipating and consumers’ demand, however in the case it needs to present these benefits. Otherssatisfying customer requirements profitably.” of sustainability in construction it is the have suggested actions the governmentThe Chartered Institute of Marketing government which is creating the demand should take, this report focuses on the using legislation, tax increases and general actions individual organisations can take communication. This is a situation to promote their business into this sector. construction marketers should be familiar The Zero Carbon Hub has already with as demand for many new products suggested that consumers should feel and services in construction are driven by that they are making the right choice for Building Regulations and other legislation. themselves and their family and that their What is new for many of us is the concept proposed branding a ‘New Way of Living’ of promoting to the consumer. (in a home with a lower carbon profile) will The introduction of Feed-In Tariffs, the actually enhance, as opposed to restrict Renewable Heat Premium and the Green lifestyle. This re-framing also solves a Deal in combination with ever increasing key problem – and key gap in the current energy prices and even the possibility debate – in that it defines the product – of power outages by mid-decade means namely ‘homes’, something that already that a new market is being created amongst exists in the consumer’s mind, as opposed home owners for energy efficient products to the abstract concept of zero carbon and services. There are various estimates homes. They have concluded that the task of the value of this, but in excess of at hand is a fundamental one of market 500,000 homes will require upgrading each creation. From a consumer perspective, year, every year, for some time to come. a mainstream market does not yet exist for The Federation of Master Builders estimates homes with a lower carbon profileiii. They this to be worth between £3.5 billion and are encouraging house builders to promote £6.5 billion per year. It is this renovation this concept for new homes and it has the and improvement market that this report potential to become a generic message for focuses on. both new and upgraded homes. While the conditions are being created for a major new construction market, the homeowner has still to become an active consumer. Action needs to be taken to influence the level, timing and composition of demand (extract from Philip Kotler’s definition of marketing). More than half of British consumers tell us that they would be prepared to take action to limit climate change, with three quarters of this group willing to insulate their homes despite some short term disruptionii. What consumers do not perceive is an overall, practical vision either for the UK’s response to climate change or for the housing (new or existing) component within this.3 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  5. 5. Creating AwarenessThe first stage of the buyer decision Additional key events for the Greenprocess, which will lead to the action Deal are:of making a decision, is that of awareness. • Wider use of Energy PerformanceHere there is confusion over the various Certificates (EPC)terms. • Roll-out of SMART meters andResearch has revealed a disconnect displaysbetween the language of energy efficiency • Consumers receiving advice onand low-carbon – making the link between energy or other household billsindividual purchasing decisions and howthey impact climate change more tenuous.These findings help explain why the Evaluationmessages to consumers are not getting The process of evaluation will also bethrough. The language of low-carbon is not influenced by behavioural economics andperceived as relevant to the choices people psychology with three of the drivers being:make in their everyday lives. (i) a tendency to ‘discount the future’It is for this reason that the Zero Carbon (prefer a smaller reward today over aHub is recommending the use of the term a larger reward in the future)‘New Way of Living’ as they recognise thatthe zero carbon debate may unintentionally (ii) the power of social norms (people arebe getting in the way of progressing what heavily influenced by what otherscould be a motivating opportunity. By around them are doing)re-framing the issue from the negative to (iii) the use of defaults (individuals tendthe positive, it is possible to change the to go with the flow of pre-set options,tenor of the debate.iii or defaults)viiiIt is thus important to use the right language At present the government’s Behaviouralwhen communicating with home owners Insights Team is researching how people(see Communications). can be influenced through incentives, neighbourhood joint action, communityInterest rewards and behavioural feedback (see Behaviour Change and Energy UseOnce the consumer is aware of the page 21).opportunity, the next step is for there to beinterest. A decision to upgrade the home is To allow homeowners to make decisionsboth expensive and disruptive and will not they need simple, clear and comparablebe taken lightly. Several trigger points have information. The government has startedbeen identifiedii for renovation and down that route with the introduction ofimprovements: EPCs and SMART meters, which will inform home owners about the energy they use.• Moving house They will further support it with comparable• Kitchens and bathrooms changed performance data.• Heating systems renewed• Loft conversions or extensions• Having children• Children leaving home• Retirement Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 4
  6. 6. EPCs were introduced in October 2008, at But manufacturers and suppliers cannot a time when house sales had plummeted. rely on the government to drive this change. Consequently they have still only been They will need to provide information about issued for a relatively low proportion of the how their products perform to allow home housing stock, but research indicates that owners to make informed decisions. This 18% of people claim EPCs influenced their also raises the issue of trust. house-buying decisions.viii Over time, and In the past decade Greenwash, the practice particularly with the introduction of the Green of making misleading sustainability claims, Deal, EPCs will start to make an impact, has become widely used. There are many increasing consumer awareness and action examples within the construction industry in the same way that energy certificates on of this as well as in the consumer market household appliances have been effective in general. As a consequence consumers because it allows consumers to make prefer information that has an independent comparisons. The CBI found that consumers stamp or third party verification. The currently think differently about energy consumer group Which? is most trusted efficiency when making different purchases; to provide reliable energy efficiency and while over half take energy efficiency into climate change information.iv account in purchasing a fridge, only a quarter considered it in buying a home.iv Combining with the home owner’s general scepticism about green claims is a negative Research by WRAP in the electrical sector attitude to the construction industry. suggests that where two products have Research by Consumer Focusii found that broadly the same specification and upfront consumer confidence in the energy and cost, the energy efficiency factor can tip the housing markets and in home maintenance balance. This factor may start to apply to services is lower than other markets. the purchase of homes. No doubt it is recognition of that fact that By 2020 every home is due to be fitted with has led the government to make a SMART meter (Self Monitoring, Analysis accreditation of installers a major plank of & Reporting Technology). Research has its Green Deal strategy. This provides the highlighted how people are surprised by opportunity to reassure the home owner, results from energy monitors and SMART not just about Green Deal installations but meters because they make visible for the about all RMI contractors. Companies first time the impact on energy consumption should support and adopt this fully. of turning on particular products in the home. The Visible Energy Trial of 75 homes Consumer Focusii also found that in East Anglia found the introduction of confidence tends to be lower when: energy displays made a significant difference to consumer attitudes. Not • Calling on a break-down service only did the displays increase people’s • Where contact is less frequent confidence in understanding their own • When issues are complex or customers energy use, but 30% reported that their may have a limited knowledge introduction had also encouraged them Companies providing these services need to buy energy efficient products, with 35% to be aware of this and work to address even considering fitting solar panels and concerns and reassure the home owner, 25% insulation as a result.iv recognising their uncertainty and that purchases will be new and one-off.5 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  7. 7. Benefits Functional BenefitsAs with any purchase decision the buyer • Meets Legislationis interested in real benefits. Unlike many • Limited disruptionpurchases there is little ‘pleasure’ to be • Design adviceexperienced from the purchase of energy • Convenient timingefficiency measures. Suppliers must work • Guaranteeto present relevant real benefits and • Credit termsdemonstrate value. These include the • Improved comfortfollows suggestions: • Increase home’s value Emotional Benefits • Well known brand • Confidence in quality • Reduce carbon footprint • Create own energy • Reduce waste • Generate renewable energy • Helping the environment • Good for my image • Feel good – part of something Cost Saving Benefits • Reduced energy bills • Produce extra income Benefits providing value Functional Benefits Emotional Benefits Meets legislation Well known brand Limited disruption Confidence in quality Design advice Reduce carbon footprint Convenient timing Create own energy Guarantee + Reduce waste Credit terms Generate renewable energy Improved comfort Helping the environment Increase home’s value Good for my image Feel good - part of something = Value Cost Reduced energy bills Produce extra income Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 6
  8. 8. Barriers We have seen that lack of knowledge However behaviour at home is starting and trust will act as barriers to purchasing to change. When asked what action they energy efficient measures. Cost is another had taken in the past year, that they had barrier to which the government is proposing not done previously, the most common a solution in the form of finance from energy responses were to: savings. Behind these main barriers sit a • Use low energy light bulbs (44%) wide range of additional obstacles dependent • Switch off appliances (39%) on the makeup of the individual household.ii • Turn down heating (38%) (See case studies pages 15 and 16 for • Recycle (34%) examples of removing barriers.) • Insulate the home (12%)ii The Value Action Gap has been identified as one barrier to home owner purchase. A gap between people’s level of concern about the environment and their actions. Research findings show that there is widespread awareness of environmental problems and that the majority of people recognise that their everyday behaviours contribute to these. This could be partly driven by a belief that taking on new behaviours will have a negative impact on current lifestyle. Chart: Lack enthusiasm 4% Manufacturers’ view of principal barriers Not enough payback 8% Mistrust 8% Too long term 8% Inconvenience 12% Resist change 12% Lack awareness 12% Attitudes 20% Lack understanding 28% 0% 10% 20% 30% Base: 257 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  9. 9. Influencers Segment 1: Positive greens 18% of the population (7.6 million)The classic marketing Decision Making “I think we need to do some things differentlyUnit comprises Influencer, Initiator, Decider, to tackle climate change. I do what I canBuyer and User. In the case of the home and I feel bad about the rest.”these roles will be distributed among themembers of the household, with the exception • Assess themselves as acting in moreof the Influencer. Here there is a wide range environmentally friendly ways than otherof influences which will drive the decision. segments.But people have lost trust in traditional • Most likely to want to live a moreopinion leaders. They use the media to find environmentally friendly life.out more information on environmental and • Hold the most positive pro-environmentalsocial issues. Films or TV documentaries attitudes and beliefs.and friends or families have most influence.ii • Likely to be doing most to reduce their impact on the environment includingThey need to see real examples of energy saving energy and water, they are theefficiency measures, not special one-off heaviest recyclers.projects. For this reason it is expected that • Most likely to buy ethical and localadoption will be by referral, with people products including local food anddeciding to implement measures because fair trade.they have seen their neighbour or the house • The least motivated by saving moneydown the road doing something. Suppliers and the most willing to pay more forneed to promote and encourage this, environmentally friendly products.providing plenty of ‘real life’ examples • Least likely to cite generic barriers toof projects. Projects also need to be being more environmentally friendly.described in general language and not the • Have the highest levels of knowledgetechnical language of energy efficiency or about environmental terms, althoughconstruction (see Communications). still around a half know little or nothing about carbon footprints.Segmentation • Most likely to want more information on what they can do.To get maximum value from the market it • Most likely to seek to influence friends,is necessary to define the market segments family and the workplace to be moreand identify those which offer the best environmentally friendly.opportunity. By defining segment personalities • Most likely to be involved in environmentalit is also possible to tailor communication to and community organisations, althoughhave maximum appeal to each segment. still at low levels. • Most likely by far to be in AB socioIn its report ‘A framework for pro-environmental economic groups and have a degree,behaviours’ published in January 2008 with household incomes of £40k andDefra identifies 7 segments which can be over per annum.modified to provide a convenient means • They are the most likely to read Theof categorising the residential market for Guardian, Independent or Times.sustainable products. Of these segments 1, • Their profile is biased towards middle3 and 4 represent the best opportunity for age (41-64), and owner-occupancy.promotion of sustainable technology. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 8
  10. 10. Segment 2: Waste watchers Segment 3: Concerned consumers 12% of the population (5.1 million) 14% of the population (5.7 million) “’Waste not, want not’ that’s important, you “I think I do more than a lot of people. Still, should live life thinking about what you’re going away is important, I’d find that hard to doing and using.” give up well I wouldn’t, so carbon offsetting would make me feel better.” • Doing more than any group other than Segment 1 to help the environment. • Hold broadly pro-environmental beliefs, • Behaviour is driven by an urge to avoid with less conviction than Segments 1 waste rather than seeking to reduce and 2. environmental impact. • Particularly sympathetic to the concept • Likely to rate their behaviour as of ‘climate change’, acknowledge their environmentally friendly. personal impact and see taking action • Nearly three quarters are content with as important. what they are currently doing to help • Show the strongest rejection of any the environment. group to the idea that we are reaching • View tends to be slightly more our limits to growth and they also doubt pro-environmental than the average, that an ecological crisis is imminent. but they are also more likely to be • Rate themselves as environmentally sceptical about environmental problems. friendly, two thirds claim they would like • Very concerned about changes to the to do more. UK countryside and loss of biodiversity. • Focus on environmental behaviours • Say the environment is a high priority in the home including saving energy for them, but are the second least likely and water (similar to Segment 5) and group (after Segment 7) to feel guilty some purchasing behaviours. about their environmental impacts. • They are less likely than average to cite • Current focus on the home including general barriers to pro-environmental saving energy and water, using a more behaviour, such as money-saving and fuel efficient car and purchasing ethical inconvenience. and local/national products. • They like to think that they are doing • Very committed recyclers, indeed they more for the environment than they are. are most likely to volunteer that they • One third are aged 30-40, with the cannot recycle any more as they lowest levels aged 65 and over. already recycle as much as they can. • Slight bias towards ABC1. They are the • Have a middle age and older age bias. second most likely to have a degree. One third aged 65 and over. One third • One third have household incomes of are retired, and many are on low £40k per annum and above, this incomes (two fifths on £20k per annum includes the highest level of all groups or less). with household incomes of £60k and • Over half own their homes outright above (nearly one fifth of the group). • Are the most likely to read the Daily Mail • They are the most likely to be owner or Telegraph. occupiers with a mortgage, and the most likely to have dependent children (along with Segment 5).9 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  11. 11. Segment 4: Sideline supporters Segment 5: Cautious participants14% of the population (5.6 million) 14% of the population (5.6 million)“I think climate change is a big problem for “I do a couple of things to help theus. I suppose I don’t think much about how environment. I’d really like to do more...much water or electricity I use, and I forget ...well as long as I saw others were.”to turn things off. I’d like to do a bit more.” • Environmental view close to the• Has a generally pro-environmental view, population average. although beliefs are held relatively weakly. • Tend to agree there is a pressing crisis• Second only to Segment 1 in anticipating and that there are limits to growth. an imminent crisis; however likely to • Pessimistic about our ability to tackle think that humans (possibly other climate change, but recognise their people) will find the solution. impacts.• Green beliefs have not translated to • Current behaviours focus on the home, behaviours. including saving energy and water.• More likely than the first three segments • A sense of popular momentum may be to say they have not thought about required for this segment to act. changing behaviours. • Report more barriers to pro-environmental• Two thirds say they know nothing about behaviour than Segments 1 and 3, carbon footprints. including the need to fit with current• Current behaviours are less ‘green’ lifestyle and difficulty in changing their than all except Segments 6 and 7. habits.• Most say they are doing one or two • More likely to feel guilty about harming things to help the environment and the environment (with Segment 4). would like to do more. • Environmentally friendly behaviours not• Acknowledge a range of barriers more a natural fit with their self-identity. readily than Segment 3, such as the • Half report doing only a few things or need to fit with their current lifestyle and nothing pro-environmental, but three the difficulty in changing habits. quarters say they would like to do more.• More likely to feel guilty about harming • Has a younger than average age the environment (with Segment 5). profile, with one quarter 30 and under• Recognise the environmental issues, and nearly as few aged 65 and over as are willing to learn and do more. Segment 3.• Appear receptive, are unlikely to be • Most likely to have dependent children. proactive in acquiring information or • Slightly more likely to be renting than adapting their behaviours. Segment 3.• Span all ages, under 30s are over- represented.• Have average levels of household income, but with a bias towards C2DE.• More likely than average to read the Daily Mail or the Sun.• Fewer than average are educated to degree level. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 10
  12. 12. Segment 6: Stalled starters 10% of the population (4.1 million) “I don’t know much about climate change. I can’t afford a car so I use public transport. I’d like a car though.” • Present somewhat confused • Tend to be younger or older, with middle environmental views, mostly strongly aged people under-represented. The negative. group includes more black and minority • Have the highest level saying climate ethnic than average. change is too far in the future to worry • Have the lowest levels of qualifications about and, with Segment 7, the highest of any group (half have none), and are levels believing that the environmental the most likely not to be working. crisis has been exaggerated. • The most likely group to read the Sun • Have the lowest levels of knowledge and Mirror. about environmental terms: only just over a third know more than a little about climate change, and nearly three quarters know nothing about carbon footprints. • Most likely to say that their behaviour does not contribute to climate change, and that the environment is a low priority for them personally. • Less likely to focus on thinking about the levels of energy and water they use in the home or generally undertake the smaller behaviour changes. • Have a lot of serious life priorities to address before they consider the environment. • The most likely to cite barriers to change of convenience, difficulty, cost issues, others’ level of action, and the need for behaviours to fit with their lifestyle. • The most likely to see being green as embarrassing. • One sixth of this segment (the highest of any) say they are doing nothing to help the environment. • Two thirds say they are happy with what they are doing and they do not want to do more. • Have the lowest social profile of any group, nearly half are DE and the lowest levels of income (nearly half are on less than £20k).11 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  13. 13. Segment 7: Honestly disengaged18% of the population (7.4 million)“Maybe there’ll be an environmental disaster,maybe not. Makes no difference to me, I’mjust living my life the way I want to.”• Ecological view is predominantly shaped • The least likely segment to want more by a lack of interest and concern. information about what they could do• Sceptical about the current to help the environment. environmental threat (half think it has • Likely to say that they find it difficult to been exaggerated). change their habits or that it needs to fit• More likely than most to think the with their lifestyle. problem will be solved without people • The least likely to feel guilty about needing to make changes to their harming the environment. lifestyles. • The group spans all ages, under 30s• Do not see themselves as ‘green’ in are over-represented (comprising more any way. than a quarter).• On each of the main environmental • Slightly more C12DE with ABs under- issues, roughly a third of this group (far represented; income levels are also more than any other) does not express slightly below average. Slightly fewer an opinion. than average have degrees.• Rate themselves as having the lowest • More likely than average to be working levels of pro-environmental activity: full-time and to be renting. more than half do little or nothing. • Read the Sun and The Star.• Have the highest level saying they are happy with what they are doing, and they do not want to do more to help the environment. Consumer sustainability segmentation identified by defra Potential to do more, Potential High potential and how to do more and willing Encourage High Enable 1: Positive greens Exemplify Engage Enable 3: Concerned consumers 4: Sideline supporters Willing 2: Waste 5: Cautious watchers participants to act Low High 6: Stalled starters 7: Honestly disengaged Encourage Enable Low Low potential and unwilling Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 12
  14. 14. Communication Even energy efficiency is a complex term. Communication has an important role Benefits need to be presented in a form to play, initially creating awareness, then that is relevant to the audience. Increased informing the home owner. To be effective levels of loft, floor and wall insulation, the right language will have to be used. reduced thermal bridging, triple glazing and An individual organisation promoting improved air tightness, when translated into products or services will need to present liveability benefits such as lower energy bills clear, credible and comparable or fewer draughts are genuinely motivating communications which are strong and factors to prospective purchasers.iii compelling against the background of messages delivered by government and the It is also important to deliver messages industry generally. Consumer Focusii make with the target segments and age of the the following recommendations: homeowner in mind. Differences in energy literacy appear to relate to age more than Clarity – Claims that are easy to understand; educational attainment, with consumers Succinct, simple, to the point without aged between 55 and 64 most confusing imagery. knowledgeable.ii Credibility – Realistic, accessible and verifiable Communication messages should be claims; Avoid small text, asterisks and foot designed on the basis that different groups notes. Include third-party endorsements from of consumers respond to different drivers. well known and respected organisations. In their research the CBIiv found that only Where possible align products with existing 15% of total participants claimed that clear products and services. evidence of a product’s reduced Comparability – Provide simple, meaningful environmental impact would be the most and like-for-like comparisons. important driver – yet this figure jumps to a quarter (24%) for broadsheet readers It is also important to follow Defra’s Green alone. Use the segment profiles to frame Claims Guidance (http://www.defra.gov. messages. (See case studies pages 15 uk/publications/files/pb13453-green- and 16 for examples of communication.) claims-guidance.pdf). The language used is also important. As already stated there is a disconnect between the language of energy efficiency and low-carbon. There is a perception that green/eco/sustainable is for environmentalists. As one resident said during research into his sustainable home “no – it’s not an eco house – that’s for those people who build it all themselves – this is just a normal house”.iii13 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  15. 15. ConclusionsThe government is committed to the GreenDeal, but to achieve take-up a marketingapproach is needed to inform and motivatethe home owner. This needs to focus onreal benefits and avoid the jargon sometimesassociated with sustainability.Many companies in the construction sectorare still not preparing for this. But productsand systems will need to be approved andin the market in just over a year.New systems that are introduced must notdisappoint the home owner once installed.They need to be designed to work effectivelyin their primary function and as a sustainableproduct. Installers must be fully trained andhome owners must know how to use themeffectively.No single section of the construction industrycan work in isolation, trade associations,manufacturers, contractors and wholesalersmust work together to create an effectivesupply chain.While the construction sector remainssceptical about the Green Deal and itssuccess, organisations from outside thesector like the energy companies and majorretailers have recognised the opportunityand are starting to act. Construction runsthe risk of becoming a second tier supplierto these organisations.Once we let new entrants into the marketthey will not be satisfied with just theGreen Deal, they will expand into generalrefurbishment and then new build. In sodoing they will marginalise the traditionalplayers in the market.The Green Deal is a tremendous opportunityfor the construction industry, companiesmust act now and make sure they deliveran effective and attractive solution. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 14
  16. 16. Case Studies Creating the business opportunity Making it Easy to Buy One of the UK’s fastest growing providers To encourage home owners to buy of renewable energy systems, The Green insulation, energy companies have been Home Company, has created its own partnering with merchants to make it easier business opportunity by securing private to buy insulation at subsidised prices. Firstly finance to allow them to install free solar PV this requires an easy to understand price systems. Most recently they have secured model quoting a price per roll. To support £15 million of finance from groups who this online calculators are available so that a specialise in backing clean technology home owner can easily work out how many companies. This will enable the Kent-based rolls of insulation to buy. company to install solar PV systems, worth up Free Delivery was a major factor in securing to £15,000 each, to around 1400 qualifying participation, removing the problem of homeowners in the period up to March 2012. getting a bulky item home from the Offering a guaranteed income for 25 years, merchant or DIY store. Feed-in Tariffs have enabled The Green Home Company to create their own market by offering homeowners totally free solar Communicating with the Consumer electricity. This is made possible by the Michael Longhawn, 60, from Gildersome, company keeping the FITs payments, Yorkshire applied for a Government grant rather than the homeowner. In exchange for for insulation after reading an article in allowing panels to be fitted to their roof the his local paper about the energy saving homeowner will benefit from free electricity benefits of insulating his property. Michael generated by the solar panels. had cavity wall insulation installed in his Following a roof suitability application process, 1950’s three bed semi and soon noticed a any qualifying home could start saving difference in his energy bills. Michael knew hundreds of pounds a year in energy bills. from DIY programmes on TV about both Suitability will depend upon criteria including the energy and money saving benefits of size of roof and its direction – ideally insulating his loft. He wanted a fuss-free south-facing pitched roof with minimal solution so opted for Space Loft Roll, Space shading so as to achieve maximum output. Insulations glass mineral wool product made with ECOSE Technology, a unique “We are delighted to have secured this and environmentally sustainable binder. funding,” commented Alan Proto, MD of Michael was delighted with the results; The Green Home Company. “We anticipate “Space Loft Roll was soft to handle, the growth of solar energy to be massive odourless and easy to work with. We no over the coming months and years and longer need the heating to be turned up thanks to the funding and the Government’s high for us to be comfortable in our home.” Feed-In Tariffs, we are in the enviable position of being able to offer homeowners free installation. We naturally expect demand to be extremely high as this offers homeowners a zero cost method of reducing their energy bills – something that is very welcome, especially following recent price increases introduced by the leading energy companies.”15 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  17. 17. British Gas launches Home Energy Plan Thinkinsulation.comBritish Gas launched the Home Energy In October 2004 leading insulationPlan, a forerunner to the government’s manufacturer, Knauf Insulation, partneredGreen Deal programme. It enables British with the Energy Saving Trust to launch energyGas energy customers who own their own saving advice website, thinkinsulation.com.home and pay by direct debit to install The online resource is a one-stop-shop formeasures such as a new efficient boiler, consumers, offering useful information andinsulation and renewable technologies at tips about how to improve their home’sno upfront cost or with a small deposit. energy consumption, help reduce emissionsAlternatively, customers can choose a of harmful greenhouse gases and savefinance plan where monthly repayments are money. The website, which received overcovered by the savings made from being 67,000 unique visitors in 2010, is rich withmore energy efficient. interactive content including diagrams and videos which help to explain how insulationEligible measures include: works as well as advice about why it’s the• Efficient heating products: A-rated boilers, most cost-effective and sustainable energy ground source heat pumps, air source saving product on the market. In addition heat pumps, solar thermal, pipe wrap, to explaining the various ways to upgrade water tank jacket, thermostatic radiator a home’s energy rating, the website also valves, programmable thermostats offers consumers the chance to request a• Insulation: Cavity wall insulation, loft no obligation survey and quote. insulation, solid wall insulation• Saving electricity: Voltage optimisation, eco-kettles, efficient lighting, electricity monitors, standby savers• Generating electricity: Solar PV, Baxi Ecogen Boiler (stirling engine).All customers signing up to the plan willreceive a free, no-obligation survey of theirhome by a British Gas energy expert. Theexpert will take the customer through thehome, recommending bespoke measuresand outlining the estimated annual savingsthat could be achieved. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 16
  18. 18. Appendix 1 The Green Deal The Green Deal, which is part of the Energy such as a house extension, where some of Bill placed before Parliament in December the work will involve upgrading efficiency in 2010, started as a concept of the previous combination with general improvements. Labour government (Warmer Homes, Once the specification for upgrading is Greener Homes) and will be launched in determined there will be a network of Autumn 2012. It is intended to make existing accredited installers from whom the homes and small businesses more energy homeowner can select a company to efficient by giving incentives which will be undertake the work. These companies paid for through savings on energy bills. will be responsible for all aspects including This is probably the most important driver the financing. for construction in the next 10 years. The Since the introduction of the Green Deal government predict that this initiative will the scope has been broadened from just create a workforce to fit energy efficiency the upgrading of existing homes to include measures of 100,000 people by 2017. all types of building upgrades and most recently the cost of introducing low carbon Products Eligible for The Green Deal measures to new homes. We are still awaiting further details on these additions. As yet a list of approved products has not been finalised, but the government has The United Kingdom Accreditation Service identified the following products as offering has been appointed as the accrediting the best potential savings. These are listed body for Green Deal assessors and is in order of benefit: developing a robust standard to ensure the quality and impartiality of the assessment. Reducing Demand All assessors will need to comply with • Smart Meters the Code of Practice being set up under • Cavity Wall Insulation secondary legislation, in order to carry out • Loft Insulation assessments under the Green Deal. • Solid Wall Insulation The British Standards Institute is developing Renewables a Publicly Available Specification (PAS • Ground Source Heat Pumps 2030) for the installation of energy efficiency • Air Source Heat Pumps measures in domestic and non-domestic • Biomass Boilers buildings. This will provide a consistent • Solar Thermal and Solar PV method of assessing Green Deal installers across the range of measures that qualify The Green Deal Process under the Green Deal. UKAS will accredit certification bodies to this standard. To reassure and inform homeowners there Members of these bodies will then be will be a network of Green Deal advisors entitled to operate under the Green Deal. who will evaluate a property and present It is hoped that this will drive standards the choices. As part of this each home will within the sector and encourage investment need to meet the ‘Golden Rule’ that the in training. costs of repayment will not exceed the energy savings achieved over a repayment period. The Golden Rule is still under development and now looks likely to allow a combination of Green Deal funding and private funding to allow for developments,17 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  19. 19. Financing the Green Deal Green Deal ImplementationInitial view on financing was that there Target for implementation is Autumn 2012.would be a single finance provider, with the At present the government is still in theenergy companies responsible for collecting process of consultation with officials fromrepayments. The Department of Energy and DECC developing the technical detailsClimate Change have now indicated that for secondary legislation. As part of thisthey are considering the option of allowing process four Green Deal stakeholderlarge providers to arrange their own finance advisory forums have been established:and also considering allowing different Installer Accreditation & Qualification Forum:finance providers to work with the smaller To advise the Government on the creationproviders. This will change the dynamic of of an ‘accreditation and qualificationthe whole concept and may disadvantage framework’ for installing energy efficiencythe smaller players. When recently products under the Green Deal.announcing the Green Investment Bank(GIB) the government indicated that Green Green Deal Advice Qualification &Deal schemes would be considered for Accreditation Forum:GIB funding. To advise Government on the development of the advice framework for the domesticDECC is now carrying out an evaluation and non-domestic Green Deal.of CERT, CESP and Warm Front as theydesign the Energy Company Obligation, Capacity & Innovation Forum:or ECO, which will take over from these To advise Government on the supply chainschemes in 2013. It is intended that ECO evolution required to meet 2020 Green Dealwill build on the strengths of the existing related climate change targets.schemes and is intended to integrate fullyand seamlessly into the Green Deal market, Maximising Energy Efficiency in Buildings:supporting the Green Deal in ensuring all To suggest ways of increasing the uptake ofhouseholds can take advantage of energy the Green Deal across a range of propertyefficiency improvements to their homes. tenures, types and geographic locations.The ECO will set concrete targets for This includes involvement of energydomestic energy efficiency improvements companies and Local Authorities.which energy suppliers are required tomeet. It will be focused on the needsof lower income and the most vulnerablehouseholds and properties which areharder or more expensive to improve andfor which Green Deal finance is less likelyto fully support the cost of improvements. Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 18
  20. 20. Appendix 2Green Deal ImplementationGovernment Response to the Low Carbon Construction Innovation and Growth Team, HM Government, June 2011.Royal Institution of Provide advice and support to Government in relation to Green Deal OngoingChartered Surveyors including: - the regulation of assessors - share existing information, advice and guidance on retrofitting of homes - highlight the independent professional advice on energy efficiency provided by members - consider producing guides to retrofitting homes and business premises.National Specialist Contribute to the development of standard solutions for typical properties for OngoingContractors Council the conditions required for the measures to be installed, in collaboration with trade associations.Energy Efficiency Build on the EEPH structures for achieving consensus on projects as part Ongoing toPartnership for Homes of the development of the Green Deal. March 2012DECC Develop policies to enable application of Green Deal to the commercial Ongoing sector, alongside household offer.DECC Announcement of the intention to establish an Office of National Energy May 2011 Efficiency within DECC to provide a wider energy efficiency strategy, strong programme management, and a cohesive view of DECC’s customer facing policies. Official start date to be confirmed.DECC Work with potential Green Deal providers to facilitate early precursor offers June 2011 onwards to the Green Deal.Royal Institution of Share findings of the Doing Well by Doing Good research into the impact of July 2011Chartered Surveyors energy performance ratings on the value of commercial property in the USA with Government and replicate in the UK subject to data and information availability.United Kingdom Open call for Green Deal accreditation of certification bodies. First accredited July 2011Accreditation Service bodies expected April 2012.DECC Consult on secondary legislation to enable the Green Deal, including the new Autumn 2011 obligation on energy companies.Industry Respond to consultation on secondary legislation to enable the Green Deal, Autumn 2011 including the new obligation on energy companies.DECC Review of existing product certification bodies, including warranty and Autumn 2011 guarantee schemes. Consult on process for verifying product performance.Industry Respond to consultation on process for verifying product performance. Autumn 2011DECC/ Energy Efficiency Assessment of supply chain capacity to deliver Green Deal retrofit Autumn 2011Partnership for Homes programme by Green Deal Capacity and Innovation Forum convened by EEPH for DECC.19 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011
  21. 21. National Specialist Provide Government with additional market sector intelligence to deliver Autumn 2011Contractors Council the installation of Green Deal Measures.Defra As part of broader sustainability information available under the Green Deal, January 2012 develop advice on water efficiency.DECC / British Standards Publication of final Publicly Available Specification (PAS 2030) for the January 2012Institution installation of energy efficiency measures into existing domestic and non-domestic buildings.DECC Lay secondary legislation to enable the Green Deal. Early 2012DECC / DCLG Examine the operation of the energy performance of buildings regime April 2012 to ensure it is capable of supporting Green Deal delivery.DECC Develop accreditation process to ensure public confidence in Green Deal May 2012 measures. Consultation Autumn 2011.DECC Green Deal Code of Practice established for products, installers and suppliers May 2012 under secondary legislation of the Energy Act. Consultation Autumn 2011.National Specialist Work with its member organisations to ensure they understand the May 2012 onwardsContractors Council requirements and if appropriate are able to implement a means of accrediting their members.DECC / Energy Companies Launch of new Energy Company Obligation to provide energy efficiency Autumn 2012 improvements for “hard to treat” properties and vulnerable households.DECC Launch of Green Deal. October 2012DECC Develop options for generating additional demand for energy efficiency October 2012 measures alongside the Green Deal finance offer.DECC Monitor roll-out of Green Deal. October 2012 onwards Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011 20
  22. 22. Appendix 3 Behaviour Change and Energy Use A new report has just been published by 3. A trial to test the impact of offering the government’s Behavioural Insights Team community rewards for the take-up which sets out research into how people of the Green Deal. Depending on can be encourage to green their homes results from initial focus groups, and be more energy efficient. These pilots rewards could range from microgeneration are based around behavioural economics technology for community buildings, and psychology with three of the most to training for community volunteers significant insights relating to: and additional support for vulnerable groups.Commercial partner: E.ON. (iv) our tendency to ‘discount the future’ (prefer a smaller reward today over a 4. A trial of how behavioural feedback, larger reward in the future) including comparative consumption information showing how individual (v) the power of social norms (people are energy use compares with similar heavily influenced by what others neighbours to help consumers with around them are doing) smart meters to save energy. (vi) the use of defaults (individuals tend Commercial partners: First Utility and to go with the flow of pre-set options, Opower. In addition British Gas and or defaults AlertMe will investigate the effectiveness of different channels in providing They are conducting a number of research personalised information to smart meter projects, including four large-scale field trials, consumers about their energy use as in time for the launch of the Green Deal. well as personalised hints and tips on 1. Effectiveness of offering upfront how to save energy. incentives to encourage the uptake Other initiatives include redesigning Energy of energy efficiency products including Performance Certificates to include a a month’s holiday from council tax clearer signpost to the Green Deal and payments and the offer of a voucher precipitate greater action towards making for goods and services. Commercial energy efficiency improvements. This partners: Homebase supported by follows research which indicates that 18% Carillion. of people claim that EPCs influence their 2. Two trials will be run. To evaluate the house-buying decisions. impact of offering energy efficiency products and services at varying levels of discount depending on how many people opt in to the offer to encourage neighbours to act together. Secondly, as a major practical and psychological barrier to loft insulation is the requirement to clear out a cluttered loft, a subsidised loft-clearing service will be offered. Commercial partner: B&Q.21 Taking Sustainability to the Consumer l The CIMCIG Industry Report 2011