Rosemary CoyneSHAP Co-ordinator

2018

ENERGY CAPITAL CONFERENCE 27.11.18

SHAP Research Introduction

2

> This can’t go on…

Beyond_Decent_Homes_IntroductionBeyond_Decent_Homes_Part_1_the_StandardBeyond_Decent_Homes_Part_2_Framework_of_benefitsBeyond_Decent_Homes_Part_3_Implementation_planningBeyond_Decent_Homes_v1_Detailed_cost_estimates_0Beyond_Decent_Homes_v1_Specification_Digest_0Beyond_Decent_Homes_Case StudiesBeyond_Decent_Homes_Bibliography_and_Appendices

https://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_introduction.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_part_1_the_standard.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_part_2_framework_of_benefits.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_part_3_implementation_planning.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_v1_detailed_cost_estimates_0.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_v1_specification_digest_0.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_case-studies.pdfhttps://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_bibliography_and_appendices.pdf

Community Green Deal

• “Community Green Deal” report -outlines a framework for the delivery of large scale, cross-tenure, whole house retrofit projects using a variety of funding mechanisms.

• Three key areas:– How to deliver retrofit measures at

scale

– How to finance retrofit measures

– How this could impact on the economy in terms of jobs, skills and the supply chain

Outcomes presented to DECC

SHAP/HCA/Urban Living Housing renewal pathfinder

Plus 75 other public and private sector org reps

Conclusion

• Significant opportunity for growth

• Need to “think big”

• Structured approach to delivery

• Financial and technical solutions are complex

• Funding is available – needs to be unlocked

• Above all – deliver carbon reductions and reduce fuel poverty

2016 - WHY did we undertake the research?

1. To advise on increasing certainty on the quality of the outcomes from investment and reduce the seeming lottery

of outcomes and project VFM – new and existing homes

“I am pleased that a national company has finally accepted that the build quality has been unacceptable on the properties. Although potential compensation is brilliant it will never fully cover the turmoil that these residents have suffered.” 2016

examples of exemplary performance in installing energy efficiency measures have been highlighted, two of which are presented in the industry chapters of this Report..However, too often interventions are not well-targeted to suitable properties and, in a minority of cases, there is poor practice and sub-standard work being carried out.

WHY did we propose the research?2. To find ways to fund largescale investment in housing –

which is part of our critical national infrastructure

Photos from SHAP Beyond Decent Homes report 2009https://shapuk.files.wordpress.com/2018/02/beyond_decent_homes_case-studies.pdf

WHAT were our research hypotheses?1. Challenge Business as Usual (BAU) and demonstrate an alternative

model for achieving Value for Money (VFM)

1. Cheaper over lifetime

2. Affordable

3. Will deliver against multiple drivers/priorities (holistic)

2. Challenge the mantra that there is no money to retrofit our existing

housing stock at scale across all tenures.

3. Demonstrate that finance IS available to tackle some systemic issues

and that using this finance differently (INTELLIGENT CLIENT and

Smart and Sustainable Procurement) will support robust risk

management and security of outcomes

WHAT did we find?

• Little evidence of pilot projects being assessed and findings being used in feedback loops which in turn inform organisational strategies. Rather, anecdotal reports that we tried something, it didn’t work, so tried something else.

Innovation is risky. We need to first of all do what we know how to do better and then within that activity create spaces for innovation where the risks are carefully managed and allowance is made for remedial work as required once the innovation is fully assessed.

Innovation can deliver great outcomes and some unexpected great outcomes. We need better mechanisms for capturing and sharing these examples.

WHAT did we find?

• Up front capital costs may not fall by going to scale but whole life total costs will reflect the value of investment in good process (egsurvey and detailing) and high quality fabric/technology solutions

WHAT did we find?

Monitoring is crucial –how do we otherwise ever know what is going on?

This Photo by Unknown Author is licensed under CC BY-SA

This Photo by Unknown Author is licensed under CC BY-NC-ND

This Photo by Unknown Author is licensed under CC BY-NC-SA

http://www.stochasticgeometry.ie/page/2/https://creativecommons.org/licenses/by-sa/3.0/http://chicot101.deviantart.com/art/Thermometer-Icon-260485458https://creativecommons.org/licenses/by-nc-nd/3.0/http://www.flickr.com/photos/martin_tod/465060015/https://creativecommons.org/licenses/by-nc-sa/2.0/

The research workstreams

Key Research Criteria

1. The research must encompass ALL HOUSING TENURES.2. The final research outcomes should be relevant and easy to navigate for

decisionmakers 3. There should be a mechanism for the research findings and recommendations to be

updated over time.4. The research should build on existing information wherever possible and NOT reinvent the wheel or duplicate other work currently or recently launched.5. The research should recognise that the voluntary standards and processes proposed should be visionary but underpinned by a pragmatism of how decisionmakers can move forward to secure better outcomes from housing investment.

WHO led the research?

Rob AnnableAxis Design

New build healthy homes

performance standard -

model

Mike Menzies

Axis Design

New build healthy homes

performance standard -

model

Jason Palmer

CAR

New build healthy homes

performance standard -costings

Pat Laughlin

EBC

Smart and sustainable

procurement

Steven Harris

Steven Harris Ltd

Retrofit finance model – delivering successful projects

Charlie Baker

Red Coop

Retrofit finance model

– financing retrofit – all

tenuers

CASE STUDY

Energiesprong

Asking for a new product

ASSURED QUALITY30+ years energy performance warranty

NON-INTRUSIVERefurbishment within days not weeks

AFFORDABLEFinanceable from energy cost savings (guaranteed)

DESIGNImprove look & feel – desirable product

Focusing on people

Imag

es: A

mb

er A

nd

erso

n @

Haw

kan

dM

ou

se

Easy to understand product with• Guaranteed comfort• Fixed monthly cost• Outcome not output

In the UK, each year:

> £5.2bn spent on existing social housing stock> £4.2bn spent by social housing tenants on energy

Energiesprongturns that into productive investment to make our homes fit for 2050

c£xk investmentToday Tomorrow

BEFORE REFURBISHMENT

Rent

EnergyBill

Utility

Housing Provider

Refurbishment investment

AFTER REFURBISHMENT

Rent

ComfortPlan

Housing Provider

> Business Model

EnergyBill

UtilityIRR

19

> Energiesprong is here!

Glasgow: Interested

Leeds: Interested

Greater Manchester: Interested

Nottingham: 10 complete homes with over 200 more in the pipeline

Essex: Application for 10 homes in negotiation

Devon: 15 homes approved

Sutton: Application for 10 homes in negotiation

London: Application for 10 homes in negotiation

Birmingham: Factory capacity

Liverpool: Bid for 9 homes

Croydon and Brighton: Bid submitted for 30 homes

https://vimeo.com/289344914/833df9ce55

https://vimeo.com/248462547 BBC news 2017

https://vimeo.com/289344914/833df9ce55https://vimeo.com/248462547

Desirable, warm, affordable homes for life

www.energiesprong.ukrosemary.coyne@energiesprong.uk

http://www.energiesprong.uk/

Investing in housing as critical infrastructure

requires systemic changeRobust process

Business case

Financial model

Standards

Evidence of performance

Designing for total cost of occupation and guaranteeing outcomes

Maximising opportunities to add value e.g. transformation of the energy system

RESEARCH REPORTS include:

Beyond Decent Homes – 2009

Community Green Deal – 2010

www.shap.uk.com/resources

New build healthy homes performance standard

Finance models for retrofit

Smart and sustainable procurement

www.shap.uk.com/research

http://www.shap.uk.com/resourceshttp://www.shap.uk.com/research

Thank you

Rosemary CoyneSHAP Co-Ordinator

www.shap.uk.comorhttps://shapuk.wordpress.com/

07971 249858

http://www.shap.uk.com/https://shapuk.wordpress.com/