DEPARTMENT OF THE ENVIRONMENT, TRANSPORT
AND THE REGIONS: THE HOME ENERGY EFFICIENCY SCHEME
ACHIEVEMENT
OF
ENERGY
SAVINGS
AND
IMPROVED
COMFORT
4. From the start of the Scheme in 1991 to March
1997, the main period covered by the National Audit Office investigation,
over 2.1 million households benefited from the Scheme. By
September 1997 total grants had reached £367 million,
covering the provision of energy efficiency measures to 2.34 million
households.[2]
5. The Department told the Committee that the Scheme
had greatly increased the take-up of energy efficiency measures,
received very high satisfaction ratings from those who benefit,
and had made a significant contribution to the Government's target
to reduce emissions of carbon dioxide.[3]
Of the 2.1 million households benefiting from the Scheme up to
March 1997, 1.67 million households were on benefit and 0.47 million
were over 60s households not on benefit.[4]
This level of take up since 1991 represents 26 per cent
of eligible households on benefits and 11 per cent of
eligible over 60s households. The Department explained that the
reason take up was not higher was that the Scheme has been cash
limited, and that if more money had been made available then almost
certainly they could have found more homes to benefit. In 1996-97
in particular there had been an embarrassing over-subscription.[5]
6. Until July 1997, the Scheme provided draught-proofing
and loft insulation only, with the choice being left to the householder,
but since that date the Scheme has been expanded to provide a
wider range of measures including cavity wall insulation.[6]
However, draught-proofing still represents the most popular measure,
representing around 70 per cent of grants both before and
after the changes to the Scheme introduced in July 1997, even
though it is the least energy efficient.[7]
We asked the Department if they were satisfied that enough was
being done to promote those measures which were most energy efficient.
The Department told us that there had always been an element of
choice for householders and that improved comfort, which draught-proofing
provides, had been regarded as a valid benefit of the Scheme.[8]
7. The Department confirmed that since July 1997
their primary concern had been to shift the balance of the Scheme
towards more energy efficient measures, such as loft and cavity
wall insulation rather than draught-proofing; but they deliberately
did not give absolute priority to the most energy efficient measure,
which would have dictated what measure the householder should
take.[9] Draught-proofing
had always been popular. For the 30 per cent of households who
lived in flats draught-proofing might be the only option they
could have chosen, and in the 1996 consultation exercise many
people had pressed the Department to keep draught-proofing as
one of the measures available. Over time the Department expected
a swing towards cavity wall insulation, which was more energy
efficient.[10] In the
first three months of the new Scheme, cavity wall insulation accounted
for 14 per cent of grants and 23 per cent of expenditure. Nonetheless,
draught-proofing still represented over 70 per cent of all
grants.[11]
8. We asked what incentive there was to ensure that
the energy efficiency measures carried out were those which were
best for the householder, rather than those which best suited
the installer. The Department told us that by seeking competitive
tenders for different types of work, they hoped there was not
a greater profit margin on one measure than another.[12]
Eaga told us they strongly believed the best way to advise vulnerable
clients on the choices available was for the installer to discuss
these with the householder face to face. To supplement that, Eaga
were now reviewing the information and advice sheets they produced
for installers to photocopy and leave with householders, which
provided advice on the benefits of each measure.[13]
9. The Department added that they were now going
to review the Scheme, and in particular the ranking of measures
according to their energy efficiency, whether to allow people
an extent of choice or to give more guidance, and whether to allow
people to have both loft insulation and draught-proofing rather
than forcing them to choose one or the other.[14]
Under the previous version of the Scheme it had been possible
to receive both measures. When the Scheme was revised in July
1997 an explicit decision was taken to maximise the number of
homes rather than treat a smaller number of homes to a higher
standard, and people were required to choose between draught-proofing,
with its immediate comfort benefits, and loft insulation.[15]
The evidence suggested that people tended to choose comfort, but
if the Department were to reconstruct the Scheme to allow households
to have both measures then this would improve the energy efficiency
obtained.[16]
10. We were interested to learn whether the Scheme
was reaching those most in need amongst those eligible to receive
its benefits. The Department told us that whilst the Scheme was
improving the energy efficiency of the housing stock, it was not
necessarily improving the energy efficiency of the worst stock;
it was going to people who had some measure of fuel poverty, who
were poor but not very poor. There was also a feeling that some
people who could benefit were missing out. Take-up in the private
rented sector, where probably the poorest people live in houses
with the worst energy efficiency, was very limited; three quarters
of the take-up was by people in local authority housing or housing
association properties. The Department assured us that the question
of how best to reach the private rented sector was an important
element of their current review.[17]
Eaga told us that the main barrier to greater take-up in the private
rented sector was obtaining permission from absentee landlords.
Eaga added, in relation to reaching those most in need, that research
done by the Building Research Establishment in 1993 and 1996 indicated
that 85 per cent of those benefiting from the Scheme
were from social groups D and E, and were on low incomes compared
to the UK average. Eaga also told us that they had done and continued
to do work with the Benefits Agency to make information about
the Scheme available to some of those in greatest need, for example
those on Fuel Direct, a scheme whereby fuel payments are deducted
and made direct from benefit entitlements.[18]
11. The Department told us they would be conducting
a review to find out more about the housing stock and who was
benefiting from this Scheme. This would allow them to target the
available funds more effectively, if Ministers wanted to
make a change of that kind. Data from the 1996 English House Conditions
Survey were now becoming available, which would tell them more
about the housing stock, and what people were spending on energy
and energy efficiency. This new data would give the Department
a better feel for where the Scheme's clients might be.[19]
12. Prior to July 1997 the Department did not routinely
measure the energy savings achieved by the Scheme. The Department
told us that the earlier Scheme did not have a target for energy
saving because its objective was simply to increase the take-up
of measures. Since then the Department had set a target for the
improvement in the energy rating of each house in which Scheme
measures were installed.[20]
We asked whether the Department's target of an improvement of
five points in the energy rating of each house, using the Standard
Assessment Procedure, was sufficiently demanding, and whether
it could be improved upon further. The Department believed that
a five point increase represented a significant improvement which
in practice would deliver savings of at least £1 a week.[21]
In addition, the Department told us that they had now commissioned
a customer satisfaction survey to establish the improvement in
comfort, rather than the energy efficiency, delivered by Scheme
measures.[22]
Conclusions
13. The Scheme has provided energy efficiency measures
in the homes of some 2.34 million households on benefits,
the disabled and the over 60s. However, the Department should
consider whether more could be done to reach those in greatest
need, particularly in the private rented sector and in the poorest
households. It is welcome that the Department will be carrying
out more research and considering the scope to target Scheme resources
at those who may need it most and where it can be most effective.
14. The Scheme enables installers to promote the
energy efficiency measure most convenient or profitable for them,
rather than guide the householder to choose the most appropriate
measure. The Committee find it surprising that more has not been
done to promote those measures which are most energy efficient,
and that despite changes to the Scheme in July 1997 draught-proofing
still accounts for around 70 per cent of work done under
the Scheme.
15. The Department should do more to measure the
energy efficiency and benefits in terms of warmth and comfort
delivered by the Scheme, and we note the further work the Department
now propose.
2 C&AG's Report paras 1.4-1.5 Back
3
Q 55 Back
4
C&AG's Report para 2.3 Back
5
Q 56 Back
6
C&AG's Report para 1.2 Back
7
Q 2 Back
8
Qs 2 and 14 Back
9
Qs 155-158 Back
10
Qs 2 and 157 Back
11
Qs 2, 12 and 46-48 Back
12
Q 49 Back
13
Q 50 Back
14
Qs 12-16 Back
15
Q 48 Back
16
Q 162 Back
17
Qs 17-18, 34-38, 41 and 45 Back
18
Qs 42-44 Back
19
Q 19 Back
20
Qs 20-21 Back
21
Q 57 Back
22
Qs 169-170 Back
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