Evaluating the Benefits of Solid Wall Insulation
The economic and wider social benefits from investing in SWI are substantial:
- Jobs - A programme supporting the insulation of 100,000 solid walls every year would support up to 29,340 jobs; the plans to reduce SWI under ECO mean 20,000 jobs are at risk.
- Exchequer revenues - The cost to Government of investing in SWI programmes is offset by 50-100% through tax receipts and other revenue streams to the Exchequer.
- Wider community benefits - SWI programmes generate a number of wider community benefits with important impacts on health, regeneration and social capital.
Maintaining SWI under ECO
INCA member companies have invested substantially in up-scaling capacity to deliver Government ambitions under the Green Deal and ECO and the proposed changes to ECO would be hugely detrimental to the SWI industry.
A vibrant SWI industry is vital for the UK
There are more than 8 million solid wall homes in Britain, a third of all of our housing. More than half of those in fuel poverty live in solid wall houses. Uninsulated solid wall properties are highly inefficient, typically leaking twice as much heat as cavity walls, resulting in extremely high fuel bills for their occupants. SWI therefore delivers huge benefits for those living in solid wall homes (average annual savings of £490 per annum compared to £140 for cavity wall insulation).
Treating 100,000 solid wall properties by April 2017 is not enough
The proposed SWI minimum of 100,000 properties to 31st March 2017, a huge 70% reduction from the original ambition of DECC’s June 2012 Impact Assessment, is insufficient to support the industry and to make a meaningful contribution towards the 8 million untreated solid wall homes.
The new £450m package of Green Deal incentives must be targeted towards SWI
INCA warmly welcomes the additional funding package for Green Deal incentives announced as part of the Autumn Statement. This must be prioritised towards SWI since other insulation measures are already fully supported through CSCO, Affordable Warmth, and by allowing easy-to-treat measures into CERO.
The cost of ECO to energy suppliers is lower than DECC’s Impact Assessment suggests
The major energy suppliers have reduced their bills by around £35 per customer per annum as a result of the package of proposals in the consultation. However, our modelling shows that the actual costs to suppliers will be significantly lower still as a result of the levelisation proposals, the carry-forward of CERT and CESP excess actions, and the current lower market costs. Overall, we estimate that the savings to energy companies over the three remaining years of ECO over and above the £35 given back to customers are likely to amount to an average of £15-£23 per annum per household, or a total of £1.1bn to £1.8bn of windfall savings.
The SWI minimum can be increased significantly using this cost headroom
Increasing the CERO ambition through a doubling of the SWI minimum to 200,000 installs to March 2017 can be delivered without increasing costs on consumer bills.
Ambitious targets for SWI must be maintained going forward
The 8 million British households living in solid wall dwellings, including half of our most hard-pressed fuel poor families, have contributed an estimated £2.3 billion over the course of successive supplier obligations, and have received only 5-10% of the benefits, the remainder of which has gone to providing easy-to-treat measures, mostly to able-to-pay households. Reducing the ambition on SWI to 100,000 homes over 4.25 years would cripple the growing SWI industry and perpetuate this huge distributional inequality.