The Government is in danger of limiting insulation sales to many households under the forthcoming Green Deal, a major study has found.
Insulation manufacturer Knauf Insulation undertook detailed market analysis, which has forecast a significant fall in the amount of insulation being installed by householders once current subsidies are removed.
Over the last few years, there have been huge subsidies on the sales of insulation to households, funded by the energy companies via the Government’s CERT (Carbon Emissions Reduction Target) initiative. Under the Green Deal, these – and the obligation placed on energy companies to deliver carbon savings – will be removed, despite these measures being crucial to the reduction of carbon emissions.
Knauf Insulation has measured the potential impact on loft and cavity wall insulation, particularly in relation to the ‘able to pay’ sector – ie. all households except those with income below a certain level. Under current proposals the Green Deal and ECO will provide no subsidies or incentives to these households to upgrade their insulation, even though there are potentially over nine million lofts that can be topped up.
Knauf Insulation managing director John Sinfield said: “We very much welcome the Government’s commitment to energy saving initiatives such as the Green Deal and ECO – they have the potential to transform the energy efficiency of our housing stock. However, without some additional incentives to drive take-up, our market forecast highlights a drop-off in insulation up-grades, meaning lost carbon savings for Government, and more importantly in these times of increasing energy costs, lost ‘cash’ savings for homeowners.”
Upgrading the thermal efficiency of properties through loft or cavity wall insulation is one of the easiest and cheapest means of reducing energy use and carbon emissions. Cavity wall insulation can save a home 550kg of CO2 a year, whilst installing up to 270mm of loft insulation can save between 110kg and 220kg CO2 a year, according to the Energy Saving Trust.
Furthermore, to optimise the potential efficiencies of any other method – be it a new boiler or thermostats, new windows or utilising renewable energy sources – any building must first be properly insulated.
Sinfield continues: “Our forecast is based on detailed analysis of both the Green Deal / ECO and the general construction market. The Green Deal is likely to offer the measures only as part of a total package to upgrade a home. This package is likely to include other higher priced measures with the capital cost being placed as a debt on the energy meter.” Initial trials in Surrey have shown that many homeowners are unlikely to take on loans of significant value.
“The Green Deal and ECO in their current form offer no real incentive to upgrade loft and cavity wall insulation for the ‘able to pay’ sector yet require the insulation industry to manage the transition between straightforward insulation measures to the harder to treat solutions overnight. This approach will damage insulation industry capacity, miss out on significant low hanging fruit and ultimately impact on Government’s low carbon ambitions for the residential sector.”
Knauf Insulation is backing the recommendation of the Commission for Climate Change that the Government should build on current proposals by aligning the Green Deal and the Energy Company Obligation (ECO) with the ambition to insulate all lofts and cavity walls by 2015, as well as 2 million solid walls by 2020.