Memorandum submitted by the Mark Group (FP 37)
The Mark Group welcomes the Committee's call for evidence on fuel poverty which is particularly timely given the Government's current consultation on extensions to the Carbon Emissions Reduction Target and the introduction of Feed in Tariffs for small scale renewable energy.
In responding to this call for evidence, we have restricted our response to areas of interest in which we operate We would be happy to provide further evidence to this inquiry, either written or in person if a more detailed perspective is required.
The Mark Group is a nationwide company, with over 1,400 employees, dedicated to delivering a 'whole house' solution to energy efficiency.
We help make over 6,000 homes more energy efficient every week from our 14 regional locations. Our portfolio has expanded in recent years to include an increasingly popular and proven range of energy saving products and microgeneration. Our services are tailored for individual homeowners as well as builders, architects, local authorities and government bodies.
• Mark Group has installed over 1 million energy saving measures in the UK since 1974.
• In the last five years alone, our activities have saved around 1.25 million tonnes of C02 and substantial energy cost savings in homes and other buildings in the UK
The coherence of Government initiatives on Energy Efficiency
We look forward to the publication of the Government's Home Energy Management document, which promises to draw together a range of energy efficiency initiatives into one overarching strategy. However, we are concerned over the delay in publishing this strategy, originally due for publication before end 2009, and then subsequently delayed to January 2010.
The range of initiatives to support energy efficiency and microgeneration would benefit from consolidation in order to reduce costs and complexity in the supply chain An illustration of this complexity is demonstrated below We are already providing energy efficiency and renewable services through the following Government schemes this year:
1 Carbon Emissions Reduction Target
a Priority Group
b Super Priority Group
c Non-Priority Customers
2. Community Energy Savings Programme
3 Warm Front Scheme
4. Pay as you Save Trials
5 Feed in Tariffs
6 Residuals from Low Carbon Buildings Programme
7. Reduced Rate VAT
8 Enhanced Capital Allowances
9 Carbon Reduction Commitment
The methods used to target assistance at households that need it most.
In targeting hard to treat homes, it is essential that the insulation of the property is improved as a first step, with the second being improvements to and correct sizing of the heating system. In practice, this would mean that the first measure has to be Solid Wall Insulation plus any loft insulation Only then should a heating measure be applied; either Gas Condensing Boiler (ongrid) or Heat Pump off grid.
We are concerned that tools used to target the neediest households have been harmed by a lack of flexibility, and or understanding of the changes that make the biggest difference to fuel poor homes.
Professionally installed insulation (cavity, loft or solid wall) should always be the starting point for reducing energy bills. Previous iterations of the energy supplier obligation have allowed mass distribution of CFL lighting, DIY loft insulation and other non-installed measures at the expense of installed options. The Carbon Emissions Reduction Target has achieved delivery of insulation to over 2 million households in the first eighteen months, but it could still do more.
We were pleased to see that the Government has proposed a minimum proportion of insulation measures in the extension to the Carbon Emissions Reduction Target (CERT+), and to promote Solid Wall Insulation through the Community Energy Savings Programme. It is however, vital that the minimum proportion of insulation measures in CERT+ be increased from 65% to 70%, a figure that the supply chain has more than sufficient capacity to deliver.
Support for households which are not connected to the mains gas grid.
Sustainable heating options alongside insulation are vital if the UK is to provide effective support to fuel poor homes off the gas grid. Annex I provides an example of the benefit to off-grid properties in installing these solutions.
The Renewable Heat Incentive (available from April 2011) could provide an effective new funding stream for renewable heating. Payment of an annual reward for heating your home by renewable energy could make renewable heating economically viable for many households who must balance up-front investment against payback through heating bills. However, a substantial amount of capital investment is still required and those living in fuel poverty are less likely to have access to such finance.
It is essential that the Renewable Heat Incentive (currently under consultation) allow home occupiers to assign rights to the annual RHI payment over to third parties. Adoption of this approach would reduce the credit risk to parties willing to lend capital for investment in renewable technologies, in turn lowering overall costs. Ensuring that homes without access to capital and/or low credit rating benefit from the RHI should be a core ambition for the scheme.
Finally, we hope that the RHI will be administered effectively and speedily. It would clearly be damaging for individual households affected and for confidence in the scheme overall if payment and administrative delays occur. In this respect, we have some concerns over Ofgem's (the Government's preferred delivery partner) relative inexperience in managing these kind of payments to consumers.
Annex 1- Case Study
The D'Amery Family
The D'Amery family live in a Victorian School house near Northampton, built in 1876 with a
large two storey extension added in 2007. The property is off the gas network.
The property was in need of some renovation as well as the addition of the extension, so the
D'Amery family were after a solution to aid a poorly insulated house, heated via oil. After consultation with the Mark Group on available insulation products, it became clear that an inclusive approach would be needed and further cost and CO2 reductions could be achieved by looking at renewable technologies.
Mr and Mrs D'Amery challenged the Mark Group to find the solutions to make the family home as environmentally friendly and energy efficient as possible and become less reliant on oil and its fluctuating price.
The new insulation, heating and hot water system not only had to have the potential to reduce the family's carbon footprint but also dramatically reduce the running costs of the property. The Challenge was to provide an energy efficient 'Whole House' approach.
After surveying the property, loft and cavity wall insulation products were recommended to the family as a starting point to save money and energy in the home, along with low energy lighting and energy efficient appliances to maximise the 'Whole House' approach.
An Air Source Heat Pump was suggested as the most appropriate renewable technology as a great low carbon alternative to a traditional boiler, which can reduce CO2 by up to 50%. Mark Group suggested the Mitsubishi 8.5kW Ecodan Air Source Heat Pump would be the ideal solution.
The Air Source Heat Pump system was scoped to run a combination of new underfloor
heating and existing radiators, which were checked for size. The domestic hot water system
was sized to provide plenty of hot water for the growing family as well as additional capacity for visiting extended family.
The external Ecodan unit was originally installed in front of the house on a temporary basis in December 2007. This was to enable their builder to de-commission their old oil boiler and begin on their extension project, whilst enabling the family to remain in the house. Once the ex-tension was in its final phase, the Mark Group returned to relocate to its current position in the back garden and re-commission the system. The Air Source Heat Pump system took 3 days to install and was completed with minimum disruption to the family. The Mark Group installation team worked with the builder to ensure this.
Before leaving the D'Amery's home, the technicians ensured that the family were fully trained in operating the system and were satisfied with the installation.
The family received a grant from the Low Carbon Building Programme Phase 1 (now closed) for £900 which went towards the cost of the Air source Heat Pump. Mark Group guided the family through the application process for this grant.
The D'Amery household have doubled the footprint of the horne with the new extension but with the help of the Mark Group they have reduced their running costs and C02 emissions. An additional benefit has been a far more convenient system, with no more refilling of the old oil tank.
The Savings so far...
The family have overcome their reliance on oil and saved around £1,600 in oil bills a year. They have had an increase in their electricity bills from £90 to about £145 per month This equates to an overall aggregated.