Context is Green Investment Bank, carbon floor price and Green Deal, and the relationships between them.
Two main themes evident through the day were carbon reduction and fuel poverty. There are pros and cons of integrating them together within the Energy Company Obligation (ECO) (which has a partial overlap with Green Deal). One of the downsides is the risk of perverse incentives and bizarre effects, such as one house getting a green retrofit because householders are in fuel poverty, but the identical house next door not getting a retrofit because the householders are not in fuel poverty. An alternative would be to separate out fuel poverty initiatives and carbon reduction ones and dealing with fuel poverty through welfare payments. Each initiative could be successful in its own right, but the separation would enable carbon reduction initiatives to focus better on finding the most cost-effective ways of retrofitting the housing stock, irrespective of whether or not the householder/occupier is in fuel poverty, for example through street-by-street or entire neighbourhood programmes.
Research suggests that the fuel poor tend to underheat their homes, and energy efficiency measures result in warmer homes for them rather than reduced energy bills.
One reason given for having gone down the Energy Company Obligation route for fuel poverty is the difficulty in identifying the fuel poor householders in order to make welfare payments to them. The example of winter fuel payments was quoted as being an unsatisfactory measure because it was too crude when it came to identifying who was in real need. [Question: Will the energy companies find it any easier than Government to identify the fuel poor for the purposes of satisfying Energy Company Obligations?]
Green Deal is about getting private sector capital and market forces into play instead of Government subsidy. However, the availability of independent advice from trusted parties will be important to householders in the Green Deal. A key feature is that the envisaged Green Deal financial products 'stick' to the property rather than the occupant (leaving them free to move on unencumbered by the financial products). The Golden Rule is not guaranteed - it's only a calculated/estimated saving, so the reality could be different. It's mainly there to protect a poorer householder moving into a home that has already been retrofitted by a more affluent previous occupant under Green Deal financing.
[Question: Is there a gap in the market for insurance, hedging or warranty products that could eliminate or reduce the risk for the householder arising from the difference, over the term of the Green Deal financing, between reality and the Golden Rule calculation?]
Many consider that the best opportunity arising from the Green Deal is to tackle decarbonisation of the housing stock on an area-by-area, or street-by-street basis (although Green Deal was not designed with this in mind).
Carbon Tax / Carbon Floor Price will soon be affecting coal, oil and gas power stations, which have so far been exempt from the Climate Change Levy. This will mean prices energy companies charge consumers are likely to rise.
Domestic Energy Assessors might be a fruitful source of future Green Deal Advisers.
Green Deal marketing, pitching and language will be important to gain widescale public engagement, acceptance and take-up. With the plethora of parties likely to be involved in the initiative, it's not yet clear how coherent, co-ordinated and effective the marketing will be.
Likely to be a 'soft' start in Autumn 2012, because many of the details are taking time to develop, and there will be many aspects where there will be lead-in times (eg in private sector business preparations).