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ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 Somewhere between a ‘Comedy of Errors’ and ‘As.

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Presentation on theme: "ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 Somewhere between a ‘Comedy of Errors’ and ‘As."— Presentation transcript:

1 ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 Somewhere between a ‘Comedy of Errors’ and ‘As You Like It’? A brief history of Britain’s ‘Green Deal’ so far Paper by Pedro Guertler, Sarah Royston and Dave Robson presented by Pedro Guertler Head of Research, Association for the Conservation of Energy

2 ACE Presqu’île de Giens, June 7, 2013 Overview ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future The Green Deal: What is it? (In theory) A history of its development (And early implementation) Conclusions Discussion

3 ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 The Green Deal What is it, in principle? ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

4 ACE Presqu’île de Giens, June 7, 2013 What is the Green Deal? ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Home energy efficiency finance mechanism Designed to address barriers of: – Up-front capital cost – Long pay-back periods of costly improvements Does this by: – Offering a commercial rate, long term fixed-interest loan for improvements – Being attached to the property, paid back via, and whoever is responsible for paying, the electricity bill – Ensuring repayments needed to pay back loan are less than the value of the energy savings created

5 ACE Presqu’île de Giens, June 7, 2013 Origins and ‘ideology’ ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Inspired by ‘PACE’ programmes in the USA Aim to ‘rebalance’ funding: away from socially-funded towards ‘individually paid for’ energy efficiency All major political parties were proposing a variation of it Socially-funded energy efficiency support is now only for technologies which don’t pay for themselves

6 ACE Presqu’île de Giens, June 7, 2013 Customer and supply chain ‘journey’ ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

7 ACE Presqu’île de Giens, June 7, 2013 Previously… ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

8 ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 A history of the Green Deal’s development… …and early implementation. ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

9 ACE Presqu’île de Giens, June 7, 2013 (Some of) the cast ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

10 ACE Presqu’île de Giens, June 7, 2013 Market-driven ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future “This is a market mechanism, funded by private capital, which we believe will deliver far more to consumers than any sort of top- down Government programme” (DECC, 2010) “…a more market-focussed approach […], where competition amongst Green Deal providers is likely to drive take-up beyond the levels expected under CERT or the option of no policies” (DECC 2012)

11 ACE Presqu’île de Giens, June 7, 2013 Market-driven. Really? ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

12 ACE Presqu’île de Giens, June 7, 2013 The industry gets ready ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future “…there is a real opportunity to stimulate the market […] Whether it’s the real deal or not, the industry is ready” (Kingspan Insulation 2011) Financial Times reported positive outlook for investors in Kingfisher shares Industry players set up ‘The Green Deal Finance Company’

13 ACE Presqu’île de Giens, June 7, 2013 Aggressive ambition ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future “[It] will be a revolution. […] The most ambitious energy-saving plan ever put forward. A once-and-for-all retrofit that will make every home in Britain ready for a low- carbon future.” (Huhne 2010) “The biggest home improvement programme since World War II” (Huhne 2010) “Europe’s most innovative and transformational energy efficiency programme” (Barker 2010)

14 ACE Presqu’île de Giens, June 7, 2013 Aggressive ambition ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future All homes to benefit by 2030… …supporting 250,000 jobs in 2030… …in an energy efficiency market worth €8.25 billion per year… …whilst saving 34% of direct CO 2 emissions from housing by 2020 (compared to 2008)

15 ACE Presqu’île de Giens, June 7, 2013 Ambitious. Really? ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

16 ACE Presqu’île de Giens, June 7, 2013 Shifting ambitions – projections ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future “…a more market-focussed approach […], where competition amongst Green Deal providers is likely to drive take-up beyond the levels expected under CERT or the option of no policies” (DECC 2012)

17 ACE Presqu’île de Giens, June 7, 2013 Shifting ambitions – rhetoric ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Rhetoric Tracker™ © 2013 C.O.D. Science Inc = 100

18 ACE Presqu’île de Giens, June 7, 2013 Stakeholder reactions ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future “We think there is a significant risk in leaving it to the market, as that has never worked anywhere in the world and is unlikely to happen in the UK” (David Kennedy, Committee on Climate Change, 2011) “[Predictions were] produced by DECC economists, a notoriously hidebound lot in a department traditionally more interested in promoting big projects – from nuclear reactors to windfarms – than in persuading people to save energy.” (The Daily Telegraph 2012) “The Green Deal Impact Assessment is already out of date” (Barker 2012)

19 ACE Presqu’île de Giens, June 7, 2013 Reframing the ambition (Nov 2012) ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future …and over-deliver in terms of the measures that are installed in people’s houses. Wherever possible, we want to see that we under- promise…

20 ACE Presqu’île de Giens, June 7, 2013 Some hope: ‘consequential improvements’ ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Right?Wrong.

21 ACE Presqu’île de Giens, June 7, 2013 Some hope: early launch date ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future October 2012, with “Excellent customer experience from day one” (Davey, 2012) “We want to launch steadily” (DECC, 2012) “It will be a soft launch.” (Barker, September 2012) “Most aspects […] will start on 1 October […] finance plans only from January 2013.” (Davey, September 2012) “…was not, in fact, a launch.” (Barker, October 2012)

22 ACE Presqu’île de Giens, June 7, 2013 Initial results 1 ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

23 ACE Presqu’île de Giens, June 7, 2013 Initial results 2 ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

24 ACE Presqu’île de Giens, June 7, 2013 Initial results 3 ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

25 ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 Conclusions ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

26 ACE Presqu’île de Giens, June 7, 2013 Risk of failure heightened by… ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Reliance on vast number of components of the Green Deal to fall into place at the right time – or to fall into place at all. Huge mismatch between rhetoric and the programme’s development A very clear case of how not to manage expectations.

27 ACE Presqu’île de Giens, June 7, 2013 Why? ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Politics: The Green Deal is a Government ‘flagship’ policy Institutional capacity: The Government was not in denial about problems with Green Deal development, but simply did not perceive them ‘Year Zero’ syndrome: The old policy framework is associated with the previous government

28 ACE Presqu’île de Giens, June 7, 2013 So… ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Is it a ‘Comedy of Errors’ or ‘As You Like It?’

29 ACE Presqu’île de Giens, June 7, 2013ACE Presqu’île de Giens, June 7, 2013 Discussion ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future

30 ACE Presqu’île de Giens, June 7, 2013 Discussion ACE aims to reduce overall energy demand to ensure a secure and sustainable energy future Questions? Comments? What are your views on moving in the direction of more market-based mechanisms? How to address underlying problems? Parallel experiences or insights? Thank you.


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