Energy companies seek home insulation projects in bid to avoid heavy fines
Greg Barker brokers retrofit cash crisis talks
Climate change minister Greg Barker is brokering crisis talks between council bosses and energy companies to save a flagship £350 million sustainability programme.
Mr Barker agreed to intervene following a meeting with the ‘big six’ energy giants in January.
He will chair a summit which will marry energy companies which have community energy saving programme cash to spend with councils with stock in need of better insulation.
The companies are worried because, under CESP, they have until December this year to improve the efficiency of 90,000 homes in the poorest and most vulnerable sections of society. If they fail to do so they face fines from energy industry regulator Ofgem of up to 10 per cent of their global turnover.
According to the latest government figures released in September 2011, just 12,703 houses so far have received efficiency work and energy companies, which have been lobbying for relaxed targets, warn they may not meet the deadline.
The date and invitees for the meeting with Mr Barker have yet to be set.
A letter about the meeting, seen by Inside Housing, was sent last month from the Local Government Association to councils. It describes the energy companies as ‘increasingly desperate’ to get energy efficiency schemes up and running. It also reveals that energy companies are considering paying the costs of additional staff needed to roll out the efficiency measures.
Abigail Burridge, senior policy officer at Local Government Association, said: ‘Greg Barker’s quite keen to meet some of the chief executives of councils and put his weight behind links between energy suppliers and councils. It was made quite obvious that the energy suppliers are struggling, and they are willing to be much more flexible with local authorities.’
Previously, landlords have been frustrated by the terms offered by energy companies in return for CESP cash, which is raised through a levy on energy bills.
When the scheme launched in 2009 energy companies offered as little as 20 per cent of the cost of retrofit works in CESP funding, leaving landlords to stump up the remaining 80 per cent.
According to Andrew Eagles, managing director of consultancy Sustainable Homes, energy companies are now offering 100 per cent funding to social landlords and other participants.
A spokesperson for umbrella group Energy UK said: ‘Energy companies are making huge efforts to meet the obligations. Energy UK is continuing to work with all parties, including Ofgem and the Department of Energy & Climate Change.’
Community energy saving programme
total community energy saving programme fund
number of homes to be insulated using CESP funding by December
number of homes insulated using CESP funding as of September 2011
20 per cent
proportion of energy efficiency work costs being offered to social landlords in 2009 by companies with CESP cash
100 per cent
proportion of energy efficiency work costs being offered to social landlords in 2012 by companies with CESP cash