Energy Performance Contracts

EPC

Where now for domestic energy efficiency policy?

While the UK Government concentrates policy effort on developing new, more flexible energy sources, there is an increasing realisation that there is another side to the equation. Perhaps the single most significant measure we could adopt to secure our energy future and to reduce carbon emissions is to make more efficient use of energy by reducing demand and wasting less.

The UK unnecessarily throws away almost a third of the energy it uses. This represents a major cost to consumers and the environment. Implementing further energy efficiency measures would reduce carbon emissions, create jobs and ultimately save more money than it costs. However, at the household level, policy and schemes that have been tried so far have made little impression on the opportunity.

The Government’s Green Deal scheme was scrapped in 2015 after a disappointing take up. While more than 300,000 assessments were undertaken, less than 2,000 resulted in active projects, a conversion rate of less than 1%. The Green Deal was a ‘pay-as-you-save’ scheme with loans made available to pay for energy efficiency measures. These were to be repaid over a period of up to 25 years through electricity bills from the financial savings that resulted. However, the 7% to 10% APR interest rate charged to home owners proved unattractive, unsurprisingly perhaps given that it was several percentage points higher than ordinary bank loans available at the time. 

So where will Government policy guide us next? High cost loans have not worked. While many householders have implemented low cost energy efficiency measures, it seems that incentives may be necessary to persuade them to go further. The goal must be to encourage them down the route of implementing more effective measures such as insulation, renewables and energy efficient heating, but policy tools are needed to deal with the high capital costs and often long return periods.

Maybe there is a clue towards the future direction of policy travel in a glimmer of hope in the public sector, where there is an increasing interest in Energy Performance Contracts (another ‘EPC’).  These formal partnerships between a public body and its energy services company (ESCO) were introduced by The Energy Efficiency (Encouragement, Assessment and Information) Regulations 2014. The contract covers the design and provision of specific energy-saving measures and on-going monitoring. It guarantees that the measures will generate sufficient savings to pay for the project, ensuring a secured financial saving over the period of the agreement. Any savings beyond the end of the contract go to the customer.

While it is early days, one EPC between E.ON and Leeds City Council is tackling energy efficiency in nine public buildings, including schools, leisure centres and data centres. The seven-year contract is projected to achieve a 26% saving in energy costs through a range of measures, such as new lighting, boiler and voltage optimisation, and upgraded building management systems. E.ON is responsible for the up-front investment, and has guaranteed that the savings over the seven years will cover all equipment and installation costs. In addition to being able to fund the repayments from the savings made, Leeds City Council will see reductions in energy costs over the long-term, improved building performance and the project is helping it meet its own environmental aspirations and obligations as a public sector body.

Book an EPC to find out how you can make your home more energy efficient.

A Proactive Approach to a Passive House

EPC - Passive House

A proactive approach to a Passive House

‘Passive House’ is a standard for a cost-effective, low-energy construction concept that produces buildings with remarkable energy efficiency qualities without compromising on comfort.  

With all of the necessary information published freely on-line, it is claimed that any competent architect can design a Passive House. The standard is also relevant to non-residential buildings such as schools and offices. While it is most simply achieved with a new-build, it can also be successfully applied during a major building renovation.

Passive House buildings combine the use of energy efficient materials, a very high level of floor, window, roof and wall insulation and an airtight design. They are designed to be ‘thermal bridge free’, meaning the insulation has no cold corners or weak spots, reducing any problems with condensation. Ventilation is nevertheless essential, and an unobtrusive system supplies constant fresh air to maintain high levels of internal air quality without creating draughts. It incorporates a highly efficient heat recovery unit that captures heat for re-use in the building.

The designers ensure that the building makes such efficient use of the sun, internal heat sources such as domestic appliances and heat recovery that a conventional heating system is unnecessary, even on the coldest days of winter. This is what defines a Passive House. During the summer, passive techniques such as strategic shading help to keep the building comfortably cool.

Tests and calculations on existing Passive House dwellings are producing some impressive data. Measurements carried out on more than a hundred Passive House properties in central Europe as part of the European Union’s CEPHEUS project showed average energy savings of approximately 90% by comparison with traditional building stock, and 75% savings against new-build equivalents.

As a result, Passive Houses are environmentally friendly by definition. While some additional energy may be required initially for their materials and construction, this is insignificant by comparison with the energy savings they enable throughout the life of the building.

Similarly, the necessary financial investment in high quality materials and design required by the Passive House standard will be offset by the greatly reduced cost of installing and running heating and cooling systems. Calculations for German Passive Houses suggest that initial construction costs are now only approximately 5% higher than those of a comparable traditionally built house. Payback periods of course depend on the size and construction cost of the building, but under most circumstances the reduced running costs are likely to offset the construction costs in two to three decades, even allowing for loan repayments.

The Building Research Establishment (BRE) is one of the certifying bodies for Passive Houses, and there are fewer than a hundred of its Passivhaus buildings in the UK. The ‘Sleepy Dorset’ blog (here) tells the story of one family’s self-build Passive House since 2016 and its successful achievement of Passivhaus status. It relates how the house performed in Dorset’s coldest winter weather for many years in March 2018, and how the family awoke each morning to a comfortable 18ºC without any heating, despite outside temperatures of -6ºC and thick snow.

Draught Proofing – The Cheapest Way to Energy Efficiency

Draught proofing

Dealing with draughts

Draught proofing windows and doors is one of the least expensive ways of increasing the energy efficiency of a home. Some ventilation is required to reduce condensation and prevent mould, but the method should be controllable so that welcoming fresh air in the relative warmth of the day does not become an uncomfortable cold draught by the evening.

As simple as it is, draught proofing is a consideration for an assessor when providing a home with an EPC.

Do not alter external air bricks or wall vents without professional advice, as these may be essential for maintaining the fabric of the building. Flues that are in use for fireplaces or boilers must not be blocked.

Even a slight draught can make a room feel disproportionately chilly in cold weather.  A well-insulated room will feel warmer and more comfortable, often meaning that the thermostat can be turned down a little, doubling up on the energy and cost savings.  For an average house, a thorough draught-proofing job can reduce heating bills by £20 to £30 a year.

This is also one of the easiest home energy efficiency projects to do. A professional job is likely to cost less than £300 for an average house, or most of the measures can be carried out quite simply by householders with the most basic of DIY skills and tools for less than £100.

DIY stores and hardware shops carry a bewildering array of draught proofing materials and it is worth investing in good quality and tested products that carry the BSI kite mark.  The larger stores offer instruction leaflets that help you to choose and install the best products.

Before you start, undertake a detailed audit of places where draughts may be entering your home and make a list and measurements to take to the store.

Amongst the most common sources of draughts are letterboxes and keyholes in external doors. Loft hatches are another common culprit. All are easily dealt with using proprietary products. 

The next group of sources to consider are the unintentional gaps left during building and maintenance:

  • window frames
  • opening windows
  • door frames
  • doors
  • floorboards
  • pipes that lead from rooms to the outside
  • electrical sockets and fittings on walls and ceilings
  • joints where walls meet the ceiling.

Most of these can be dealt with using a suitable flexible silicone sealant. Add self-adhesive draught-proofing strips or brushes around opening windows and use the sealant in any gaps between the frame and the wall. Foam strips do not work well on sliding sash windows, so fit brush strips or consult a professional.

For external doors, buy a drop-down keyhole cover and a letterbox flap or brush. Gaps between the door and the frame can be sealed with foam or brush strips like those used for windows.  A large brush or hinged flap draught excluder will deal with the larger gap at the bottom of the door. Gaps around the frame can be filled with the sealant.

Keeping doors closed is good practice and an old-fashioned draught-excluder can be laid across the bottom of any door to stop the last remnants of draughts and to give a feeling of comfort.

The Biomass Boiler Alternative

Biomass Boiler

An Introduction to Biomass

Households that are not keen on modern renewable energy technologies might prefer a more traditional wood burner or biomass boiler. Man has been burning wood to provide heat since he first harnessed the power of fire in his cave, but a modern biomass boiler offers a more sophisticated solution to home heating.

Simple wood burning stoves provide heat and a focal point for the main room and can include a back boiler to run small-scale central heating and hot water systems. A biomass boiler works like a normal gas or oil boiler but they burn renewable biomass instead. New generation systems are easy to use and deliver greater than 75% energy efficiency using pellets or properly dried wood.

Systems are available for a range of fuels, including logs, wood chips, sawdust, grass-derived biomass pellets or even peat. The choice of fuel will be dictated by the availability and price of a reliable local supply and the type of storage available. The greatest savings are made when buying in bulk so to get the best deal a significant amount of storage space is required.

Pellets are much easier to transport and store than logs, and provide a more controllable heat. Pellet-fuelled biomass boilers are available with automatic fuel feeders and they can be programmed in much the same way as conventional gas boilers. Log-burning stoves and boilers involve considerably more work and are less controllable.

The installed cost of a wood burning stove will be around £2,500 to £7,500, depending on the model and the availability of a flue. The price of a full biomass boiler system is greater than that of a comparable gas boiler at between £10,000 and £20,000, depending on model, size and ease of installation.

After the initial outlay, the system should reduce energy bills over time, with some studies suggesting that a biomass boiler can save the average household up to £800 a year when compared with standard electric heating, or up to £210 a year compared with an old G-rated gas boiler. However, at typical 2018 prices, running a biomass boiler is likely to cost more than a modern condensing gas boiler.

To maintain efficiency, the flue will need to be cleaned annually at a cost of around £50. Another downside is the need to remove and dispose of ash. Some biomass boiler systems have automatic ash removal and compression systems that make the job easier.

Government support is available for the installation of a biomass boiler or biomass stoves with a back boiler through the Renewable Heat Incentive scheme. The income depends on the system and the amount of energy it produces but the payment for a biomass boiler in a four-bedroom, detached house may be nearly £2,000 per annum. To be eligible, the property must have a compliant EPC that is less than two years old.  There is a calculator and information on the BEIS website here.

Energy Storage – What’s in Store for Out Electricity Supply

Energy Storage

What exactly is in store for our electricity supply?

Despite the drive to make our homes more energy efficient, the demand for electricity remains strong.  As the traditional generating stations come to the end of their lives and we strive for a lower carbon economy, there is an ever-increasing reliance on renewable sources of power. The costs are coming down, but wind is unpredictable and intermittent and we cannot rely on the sun to provide us with the electricity we demand at the flick of a switch, especially at night.

It looks as though energy storage will need to become an essential part of our electricity supply system if we are to achieve our green goals and keep the lights on. Electricity storage technology can overcome the issues associated with the intermittency of renewables and help to meet the morning and the evening peaks in demand, whether at a domestic, community or national scale.

At present, energy storage capacity in the UK represents a tiny part of our electricity consumption and depends heavily on a few pumped storage hydroelectric facilities. We are otherwise reliant on switching generating stations on and off, or on importing renewable hydropower from Norway to deal with the fluctuations.

Research into battery technology has really taken off. The Government’s January 2017 Industrial Strategy Green Paper (here) states:

Given the UK’s underlying strengths in science and energy technology, we want to be a global leader in battery technology…’

The Government went on to launch a £9 million competition to find ways of reducing the cost of energy storage technologies, including the Faraday Challenge – a £246m commitment up to 2021 on battery development for transport, home and industrial applications.

The costs of storage are reducing as this research progresses.  In its 2016 report to the Renewable Energy Association, The development of decentralised energy and storage systems in the UK, KPMG predicts that there will be a ‘steady cost decline of 12% per annum through to 2020…’ (available here).

At the moment, most of the interest is in lithium-ion batteries and this technology accounted for 83% of installed global storage capacity in 2016 (excluding pumped hydro). The costs continue to fall with close to a 20% reduction in 2016.  Some issues remain with the relatively short life of the batteries and a deterioration in their efficiency as they are cycled through charging and discharging.  The focus could change in the medium term to developments in hydrogen and heat storage that are creating some excitement.

Products are already appearing for domestic use. They are arguably led by Tesla which is building a ‘Gigafactory’ in the US to produce batteries for its vehicles and for other domestic and commercial uses. Once complete, Tesla expects the Gigafactory to be the biggest building in the world, and it will be entirely powered by renewable energy sources. The factory brings an economy of scale that should make batteries more efficient and affordable.

Tesla is already marketing its solar roof tiles and ‘Powerwall’ domestic energy storage systems. These harvest and store electricity produced during the day for use when household demand is greater in the morning, evening and at night.

The Importance of Reducing a Carbon Footprint

Carbon Footprint

The other EPC

Most people have financial savings at the forefront of their minds when considering home energy efficiency improvements. Some will have more than a passing thought for the environment.  Whatever the motivation, individual households can make an important contribution towards national energy efficiency goals and greenhouse gas reduction targets. While focussing on the primary meaning of EPC, an Energy Performance Certificate, we should not lose sight of the second, Every Property Counts.

Better energy efficiency brings reductions in carbon dioxide emissions, which account for some three-quarters of the greenhouse gases released into our atmosphere.  Carbon dioxide is produced whenever fossil fuels such as coal, gas and oil are burned to produce energy for transport, heat or electricity generation.

A ‘Carbon Footprint’ is not a buzzword, it is a very important consideration for us all.

The vast majority of scientists now believe that our greenhouse gas emissions are contributing to climate change. They form a blanket in the atmosphere that traps some of the reflected energy from the sun, causing warming that affects the oceans, ice caps, vegetation and weather patterns. This is beginning to have serious consequences for the environment and for the wildlife and people that live within it. Carbon dioxide can persist in the atmosphere for up to 200 years, so even if we take urgent action now, emissions that have already been released that will continue to affect our climate for generations to come.

Some of the consequences of climate change are potentially disastrous. Precipitation is reducing in some areas around the world, causing drought, while others are experiencing increased rainfall and storms, exacerbating sediment runoff into rivers and drinking water supplies, and producing more frequent and severe floods.

Increasing temperatures are melting ice sheets at the poles and causing sea level rise, adding to the risk of flooding at the coast and threatening the very existence of some low-lying islands.  Rising sea levels can also cause saltwater to infiltrate some freshwater systems. 

Overall, climate change is increasing the demand for water while the supply diminishes. In turn, this will affect food production, levels of malnutrition and disease in some of the world’s poorest nations.

Climate change also seems to be contributing to increasing damage from wildfires and tropical storms, so the consequences can be financial as well as social and environmental.

What Can We Do?

One of the best ways of countering climate change is to address the carbon footprint of every country, industry, community and individual household. Well over 10% of the carbon emissions in the UK come from electricity use in private households, so one immediate way to reduce our carbon footprint is to take control of energy wastage. Turn off lights, heating, air conditioning and electrical appliances when they are not needed, unplug chargers, and do not rely on standby settings. Insulate your property, switch to energy efficient light bulbs, put in a smart meter, change to a new and more efficient boiler and use a microwave when possible.

It takes a huge amount of energy to get water to your home too, so conserve it by having shorter showers and turning the tap off while you brush your teeth, and save rainwater for watering the garden.

Individually, each property’s contribution may seem modest, but add them together and they may represent an earth-saving carbon footprint reduction.

Six Common Energy Efficiency Myths

Energy Efficiency

Energy Efficiency Myths

Myth One

If I turn up the thermostat the room will get warm much more quickly.

This is not the case. A thermostat simply controls the maximum temperature, so turning it up will not alter how long the heating takes to achieve that room temperature.

Myth Two

It is more efficient to keep the heating on low all the time than to keep turning it on and off.

This means that your house is heated when you are not there and that it may be cold when you are home. It is far better, in terms of energy efficiency, to use a timer to heat the rooms that you are using while you are there. On a regular daily cycle, it is not necessary to have the heating on constantly to keep the fabric of the house warm. If you are away in winter, use a timer and thermostat to avoid frost damage to pipes. You can use radiator valves to restrict the heating to the rooms that you are using. Most people find 18°C to 21°C comfortable in an occupied room, and radiators can be turned down to 14°C or lower in other rooms.

Myth Three

When it is cold outside I need to turn the thermostat up to keep the house warm.

A thermostat maintains a desired temperature in the house no matter what the weather is doing outside.  Once you have selected your comfortable temperature, it can remain at that setting which improves your home’s energy efficiency.

Myth Four

Energy saving light bulbs take a long time to get bright, and they are very expensive.

There have been improvements in lighting technology in the last few years, especially with light emitting diode (LED) bulbs. They reach full brightness immediately, have reduced in price, typically last for over 20 years and their running costs are approximately a third of those of a comparable traditional halogen bulb.  

LED bulbs are now the best choice in terms of practicality and energy efficiency.

Myth Five

An appliance in standby mode does not use much energy..

Appliances on standby still use electricity. For an average household, turning them all off completely when they are not in use could save nearly £50 a year.

Myth Six

My vital appliances are responsible for much of the energy I use, so there is nothing I can do to reduce consumption.

Large appliances are responsible for about 15% of the energy bill for an average home, so dealing with the energy efficiency of heating is a greater priority. Nevertheless, choosing energy efficient appliances can also make a real reduction in consumption and bills. Compare energy labels on appliances before buying. Choosing an A+++ tumble dryer rather than a C-rated model can save approximately £50 per year.  A new A+++ electric oven will use some 60% less energy than a B-rated equivalent. 

Careful planning of how you use your appliances could also help. Dishwashers are very energy hungry, and can cost an average household nearly £50 a year to run. Consider whether you really need to use it to wash a few plates and make sure you wait for a full load before turning it on.

Loft Insulation

Loft Insulation

Roof insulation

Modern houses are built with loft insulation, but older properties may be losing a quarter of their heat through the roof. Installing or topping-up insulation in a standard loft is an easy and cost-effective way of making a home more energy-efficient. 

Types of loft insulation

For an accessible loft, the most straightforward method is to lay loft rolls of mineral, glass or sheep’s wool between and over the ceiling joists to a depth of 270mm. A layer is placed between the joists then another is laid at right angles to cover them.  For topping up, the appropriate depth of loft roll is simply laid on top of the existing material.  The loft door can be insulated, but it is better to replace it with an insulated trap door.

The second method, blown installation of fire-retardant mineral wool or cellulose, is for roof spaces with difficult access. The process usually takes no more than a couple of hours.

Finally, for flat roofs, expanded polystyrene insulation boards can be attached on or beneath the roof. These can be a bit more expensive and complicated to install, and can lead to condensation problems, so installation is best left to a professional.

Storage

If the loft is used for storage and there is insufficient joist depth to accommodate the insulation, there are two solutions. The first is to infill between the joists with loft roll and then lay insulation boards and chipboard loft boards across the top. Alternatively, the level of the loft floor can be raised to accommodate two layers of loft roll, by fitting battens across the joists and nailing chipboard loft boards on top.

For either method, a gap should be left between the loft insulation and the boards to prevent condensation and compression of the loft roll, which will reduce its efficiency.

Loft conversions

The floor of an existing loft conversion can be insulated to keep the rest of the home warm, with loft roll added between pitched roof rafters and insulation boards to false ceilings, walls and dormers to keep the loft room itself cosy. A 50mm gap is needed between insulation boards and roofing felt for ventilation.

Other things to remember

For DIY, choose products with an ‘Energy Savings Trust Recommended’ logo, insulate pipes and tanks and do not install loft roll beneath the cold water tank. Remember to wear protective clothing and a mask.

If the space is used to store perishables like photographs or clothes, the roof should also be insulated to keep more heat in the loft.

An insulated loft needs to be adequately ventilated around the eaves to prevent damp. If there is an existing damp problem it is best to get professional advice.

Costs and savings

270mm of new loft insulation could yield annual savings of £225 for a detached house or £135 for a three bedroomed semi-detached. The cost would be £395 or £300 respectively. It may be possible to get grants through the Energy Company Obligation (ECO) towards the costs. Check with your energy supplier.

Minimum Energy Efficiency Standards (MEES) for Landlords

MEES

The requirements for private rental properties are being tightened under the law, as the Government brings the various provisions of The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 progressively into force in order to promote a new baseline minimum level of energy efficiency.

From 1 April 2018, landlords must have implemented energy efficiency improvement measures to ensure that privately rented properties in England and Wales achieve an Energy Performance Certificate (EPC) rating of E or better before they agree a new tenancy with existing or new tenants.  This requirement will be extended to all domestic rental properties in April 2020, whether or not there has been a change in tenant, and similarly to non-domestic rental properties from 2023.

This is known as the Minimum Energy Efficiency Standards, or MEES.

The required improvement measures referred to include any energy efficiency enhancement work that qualified for the Green Deal, and the installation of a gas supply provided the property is within 23m of the main.

The requirement will not apply to properties that are exempt from needing an EPC, such as some listed or temporary buildings, furnished holiday accommodation and properties that have been let continuously on a Regulated Tenancy to the same tenant since before 1 October 2008.

A landlord may be able to gain an exemption from the requirement under certain limited circumstances. These include:

  • Where all practicable energy efficiency improvements have been implemented but the property still fails to achieve EPC E banding.
  • A necessary measure cannot be implemented because it would have a negative effect on the structure or fabric of the building.
  • Third party consent is required to implement a measure, but it cannot reasonably be obtained.
  • A Chartered Surveyor’s report demonstrates that the measures would reduce the value of the property by more than 5%.

Exemptions may also be possible where landlords can demonstrate that they have been unable to access funding such as Green Deal, Energy Company Obligation or other grants to cover the full cost of installing the recommended improvements, though the details of this are subject to an on-going Government consultation exercise.

Special arrangements are also in place to provide time for landlords that have recently inherited properties to bring them up to the required standard.

Any exemption must be registered on the National PRS Exemptions Register on the BEIS website by 1 April 2018. The exemptions are for five years, during which time the landlord is expected to make further attempts to bring the property up to at least band E status, though a further exemption can then be applied for if this has not been reasonably possible. Exemptions do not pass with title, so a landlord buying a property with an existing exemption will need to apply for a new one.

The Regulations will be enforced by local authorities, who can issue compliance notices and demand copies of relevant paperwork.  They can hand out fixed penalties for non-compliance, and these can reach a maximum of £5,000 per breach. 

The Government’s guidance on the requirement is available here.

Buying a better gas boiler

Gas Boiler

Heating and hot water accounts for well over half of the total energy use in the home, so if you have an old gas boiler, changing to a more efficient model will save you money and give you a higher score on your EPC.

Boiler efficiency

Boiler efficiency is defined as a percentage, with gas boiler installation now restricted by regulations to those with a score of 88% or better. The energy efficiency is rated from A to G, with modern condensing boilers getting an ‘A’ rating.

Boilers more than 15 years old are likely to be inefficient due to hot gases escaping up the flue. Modern condensing boilers have larger heat exchangers that recover more heat.

If your boiler has a plastic flue and a second pipe coming out of the bottom to drain condensate outdoors it is a condensing type. If it does not have one of these, it is worth considering an upgrade.

What is available?

If you have a mains gas supply, a gas boiler is likely to be the cheapest option. There are two main types.  Regular (or conventional) boiler systems heat the water and store it in a cylinder.  Combination (combi) boilers heat the water on demand without the need for a cylinder. A third type, system boilers, are typically used in large houses with a substantial hot water demand.

Regular boiler systems take up quite a lot of space, but provide the highest hot water flow rate. However, they do lose some heat from hot water stored in the cylinder. They are generally a good choice for homes with more than one bathroom and a predictable hot water demand.

Combination boilers are the most popular choice as they are cheaper to install, more compact, and they cannot run out of hot water. They are less efficient than regular boilers when heating small quantities. They are suited to homes with limited space and no existing hot water tank, and those with a less predictable hot water demand. 

A new boiler is a big investment, and the technology can be complex, so check with a qualified installer what would be best for your home.

What if I don’t have gas?

Gas boilers are available that run on liquefied petroleum gas (LPG) from a tank, if there is outdoor space for one.  Oil-fired heating is a popular alternative, though heating oil prices can be volatile. With Government support schemes, low-carbon alternatives such as heat pumps or biomass boilers may present a cheaper option.

How much can I save?

A smaller, cheaper gas boiler may suffice in a well insulated home, so make sure you do that first.  New boiler prices range from approximately £500 to £2,500. Installation costs vary, so getting at least three quotes is recommended.

Your annual savings will depend on how inefficient your old boiler was. As an example, replacing a G-rated gas boiler with an A-rated condensing boiler could save up to £325 in a detached house, or £200 in an average semi-detached house.  An £1,800 gas boiler bought to replace a 60% efficiency boiler will pay for itself in seven and a half years.