Recent research has demonstrated that retrofits on homes deliver less than three-quarters of expected energy savings. Further new research has shown that only low cost Green Deal measures are likely to meet the flagship energy efficiency scheme’s “golden rule” payback criteria because energy efficiency retrofits perform significantly below predicted levels.
Under the Green Deal energy efficiency measures are paid for out of savings to energy bills over a number of years. If these modifications perform worse than expected, it will take longer for them to pay for themselves. The research conducted reviewed a typical thirties terraced house with a standard and a radical package of energy efficiency measures, and found only 73% and 71% of the energy efficiency expected was achieved.
The study’s findings (calculated by Sweett Group) revealed that the standard package would pay back 54% of its costs over 25 years and the radical package paid 22% when interest rates were assumed to be 7.5%. The standard retrofit included cavity wall and loft insulation and a new boiler, all of which qualify for Green Deal funding. The radical retrofit included the external wall and floor insulation, and triple glazing.
Longer payback periods could mean some measures will not meet the Green Deal’s “golden rule” which specifies measures must equal or greater than the savings on energy bills over 25 years.
The Department of Energy and Climate Change (DECC) has published “in use factors” that aim to tackle the issue of under performance in use by making a deduction in predicted energy performance. Cavity wall and loft insulation has an in-use factor of 35% and new boilers have a factor of 25%. However, DECC has not provided details on the impact under performance will have on payback periods.
Carbon saving targets downgraded:
The government has downgraded its prediction of the carbon savings that the Green Deal and Energy Company Obligation will deliver, its own impact assessment of the policy has revealed. The government estimates the scheme will deliver a saving of 1.8MTCO2 per year – down from 2.1MTCO2 per year in its original consultation proposal, published in November last year.
