Street by street, house by house, area based retrofit for low carbon homes

Best approaches for Scotland

David Adams

Head of External Affairs

But it’s ok?

“1.1 Scotland is an energy-rich nation, internationally recognised as having vast resources in renewable energy, oil and gas.”

Peak oil?Or, viewed from afar:

Peak Oil – Viewed from a distance

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US

Do

llars

What will energy cost

in 2050?

Fuel poverty

Progress to date…

1970 1980 1990 2000 2008

Progress to date…

1970 1980 1990 2000 2010 2020 2030

Future

Heat and Energy Saving Strategy

Homes

Your targets…

• 80% CO2 emissions reduction by 2050

• 42% CO2 emissions reduction by 2020

Scottish Final Energy Consumption

Victorian 3 bed semi*

• Appliances 1.2TCO2pa

• Lighting and pumps 0.5TCO2pa

• Water heating 1.0TCO2pa

• Space heating 4.5TCO2pa

• Total 7TCO2pa

*Includes some upgrades – 30% Low energy lighting, 50mm Loft insulation, basic double glazing

Retrofitting

“Standard” package:• Cavity wall insulation• Loft insulation• Condensing Gas Boiler • Heating controls• Low energy lighting• Draft proofing• Floor insulation• ….

• Circa £3,000 to £4,000

Retrofitting

“Expensive to treat” package:• Solid wall insulation• Loft insulation• Condensing Gas Boiler / Biomass boiler /GSHP• Heating controls• Low energy lighting• Draft proofing• Floor insulation• ….

• Circa £12,000 to £20,000

The challenges

• 42% reduction in energy

• 2.5 million homes

• Typical £7,000 each to upgrade

• £16billion

– £1.6B per year

• £6 M per working day

– 900 homes completed every day……

The challenges - engagement

• Requires 900 homes completed every day……

• Today? guess = 150K pa or 500 per day

• Issue - much more needs to be done with each to reach a 42% reduction

• = Area based refurbishment

• = single streets

• = single homes

Area based approach

Barriers to energy efficiency

Including• split incentives, • Behavioural inertia• Institutional inertia, • perceived risks of investment, • not ‘top of mind’ issue

The challenges – what, when

• Whole house all at once is expensive• Scary numbers!• … will be appropriate on occasions• Need to have a whole house ‘plan’• Execute it at appropriate times

• Need the community - Area based approachCreate momentum

Demonstrate locally what can be done

Reassurance

Protection

Raise to ‘top of mind’

…. even if single homes are refurbished• Behavioural

The challenges - financial

• Where does £16billion come from?

• Euqivalent to £640 spent per household per year to 2020 ????

• ……

• “However, due to the significant sums involved, it is assumed that those who are able to pay will invest or borrow to undertake work.”

• Why?

Remembering…

Significantly more would be spent on fuel than on the cost of the energy efficiency measures

Energy efficiency makes sense:Climate, energy security, fuel poverty, cost

Financing approaches

• Required rapidly • Need a range of, available to all

– Green mortgages– “Pay As You Save”

Financing approaches

• Required rapidly • Need a range of, available to all

– Green mortgages– “Pay As You Save”– …..

• Need to ‘value’ energy efficient homes– Regulation to drive valuation

• Need financial incentives

Remembering:

Significantly more would be spent on fuel than on the cost of the energy efficiency measures

We are not putting people into debt

Compulsion or incentives?

• Need to engage• Incentives – yes• Make it “easier to do” than “not do”• Responsibly warn people what is to come

– Fuel costs, – climate, – Legislation

• = withdrawal of incentives..• = unable to sell / rent• must give long timescale warning (but effect is more

rapid)• …and in some circumstances - compulsion

Supply chain…

• Industry will invest if there is confidence in:– a robust– Quality– long term market

• Your time scale is very short• Need to serious delivery plan

They would be mad not too

Remembering…

Significantly more would be spent on fuel than on the cost of the energy efficiency measures

Energy efficiency makes sense:Climate,

energy security,

fuel poverty,

Job creation

Comfort

Costs less!

It actually doesn’t get any better than this!Just need to work out how….!

Thank you

David Adams, Knauf Insulation