Warmer Homes Scotland: annual review 2017 to 2018

Part 3: Objective 2 - Climate Change

The second stated objective of Warmer Homes Scotland is to contribute to a reduction in the emissions of carbon dioxide from Scottish homes.

It is widely accepted that the most cost effective way to reduce emissions, and therefore tackle climate change, is by reducing demand for energy. Warmer Homes Scotland was designed to help address the issue of energy demand amongst fuel poor households. The scheme emphasises a "fabric first" approach to measures installation and imposes restrictions on support for certain high carbon fuel types such as oil central heating.

To establish the extent to which Warmer Homes Scotland is contributing to the reduction in domestic energy demand, and therefore meeting its climate change objective, this review sought to answer the following questions:

• Is Warmer Homes Scotland contributing to a reduction in greenhouse gas emissions?
• Does Warmer Homes Scotland offer the most suitable measures to respond to climate change challenges?

Table 5 shows the breakdown of the total number of measures installed in 2017/18, and from this, Figure 12 demonstrates the key findings and includes the full list of all measures offered under Warmer Homes Scotland.

The data analysed during the review indicates that, on average, the level of financial investment per household in providing energy efficient measures has increased minimally from £4572 in 2016/17 to £4576 per household in 2017/18.

In addition, the average SAP point gained per property in 2017/18 by installing energy efficient measures was 9.6, this demonstrates a slight reduction of 0.4% when compared to the average SAP point gained of 10.0 in 2016/17. There was also a 13.7% reduction in the average annual carbon emissions saved per household in 2017/18 -1.58 tonnes when compared to the 1.83 tonnes saved in 2016/17.

The mix of measures installed to properties under the scheme in any one financial year can impact on the SAP points gained. The mix of measures installed during 2017/18 is different from the previous year and the measures installed will be partly dependent on the type of properties applicants live in but also the perceived attractiveness of some of the non-mandatory measures available under the scheme.

The average SAP point gained per property during this period of this review represents lower fuel costs for these properties and lower associated carbon emissions as a result of receiving an installation under Warmer Homes Scotland.

It may be the case that there has been an increased level of support provided to rural, island, off-gas grid, stone-built or EPC Band D properties, any of which may incur higher costs per measure installed.

However, it is reasonable to suggest that as decreasing numbers of "easy to treat" properties benefit from the installation of measures under Warmer Homes Scotland, the financial cost to improve the energy efficiency rating of the remaining properties inhabited by fuel poor households will increase. This would have a knock on effect on the associated Climate Change gains from Warmer Homes Scotland. In addition, the overall reduction in the number of gas boiler, cavity wall and loft insulation measures installed during 2017/18 and the increase in energy efficient glazing and doors when compared to 2016/17 will also have had an impact on the SAP points gained during 2017/18.

During the course of the 2017/18 financial year, Warmworks reported that changes to the criteria for eligible measures for which ECO can be claimed and changes to ECO regulations following the introduction of the UK Government's ECO2 transition period on 1 April 2017 resulted in a disruption to the flow of ECO funding.

It should be noted that the transition to ECO3 during 2018/19 may continue to impact on Warmworks ability to leverage in ECO funding which may further reduce the annual carbon savings achieved by the scheme.

Analysis of Table 5 indicates an overall 3% reduction in the number of measures installed under Warmer Homes Scotland in 2017/18 compared to 2016/17. However, there has been an increase in the number of energy efficient measures installed under the scheme when compared to the overall number of measures installed during 2016/17

In 2017/18, Air Source Heat Pumps accounted for 70 (1.42%) completed installations (in comparison to 32 (0.6%) in 2016/17. Electric Storage Heating (for which the scheme installs modern, high heat retention storage heaters) accounted for 301 or 6% of completed installations in comparison to 242 or 4.5% of completed installations in 2016/17. There was also a marked increase in the installation of energy efficient glazing and doors during the period of this report with 999 or 20.4% of completed installations in comparison to 558 or 10.4% of completed installations in 2016/17. The number of hot water systems installations also increased to 353 or 7.2% of completed installations in 2017/18 from 236 or 4.43% of completed installations in 2016/17.

In addition, there was an overall 11.7% reduction in natural gas boiler installations from 3770 installations or 71% of completed installations in 2016/17 to 3327 installations or 68% of completed installations in 2017/18. The overall number of LPG boiler installations has reduced overall by 29% in 2017/18 from 281 installations or 5.3% of completed installations in 2016/17 to 200 installations or 4% of completed installations in 2017/18.

There was also a marked decrease in the overall number of cavity wall and loft insulation installations in 2017/18 when compared to 2016/17. Cavity wall installations decreased overall by 44% from 170 or 3.2% of completed installations in 2016/17 to 95 or 1.9% of completed installations in 2017/18. There was also a 29% decrease in the overall number of loft insulation installations in 2017/18, from 703 in 2016/17 or 13.2% of completed installations to 500 or 10.2% of completed installations in 2017/18.

Previously, customers who were eligible for assistance from the scheme but lived in a Residential Park Home were unable to receive a new gas connection under Warmer Homes Scotland. However, in August 2017 the contract was amended by means of a CVN to include the installation of new gas connections for Residential Park Homes.

As a result, Warmer Homes Scotland provided 2 Residential Park Home residents with a new gas connection during the period August 2017 to the end of March 2018.

This variation to the contract ensures that Warmer Homes Scotland can now assist households who are resident in Park Homes to access a wider variety of heating options for their properties.

Lower cost insulation measures such as loft and cavity insulation are mandatory measures under the Warmer Homes Scotland contract unless the property already has insulation installed to the same or higher specification than that set out in the contract technical specification or where the surveyor determines that the measure is inappropriate or unsuitable for the property (but not because the customer does not want the measure installed).

There has been a decrease in some of the completed insulation measures installed under the scheme during 2017/18 when compared the overall number of completed installations in 2016/17.

• Cavity wall insulation installations decreased from 3% in 2016/17 to 2% in 2017/18;
• External Wall insulation installations decreased from 3% in 2016/17 to 2.7% in 2017/18;
• Flat Roof insulation installations decreased from 0.4% in 2016/17 to 0.3% in 2017/18
• Internal Wall insulation installations decreased from 1.27% in 2016/17 to 0.6% in 2017/18;
• Loft insulation installations decreased from 13% in 2016/17 to 10% in 2017/18; and
• Draught Proofing decreased from 4.6% to 3.8% of completed installations in 2017/18

The decrease in insulation measures being installed under the scheme may be due to properties having benefited from insulation measures installed under previous Scottish Government funded insulation schemes or UK Government funded ECO schemes designed and delivered to improve the energy efficiency of properties.

The decrease in External Wall (EWI) insulation measures installed in 2017/18 (131) in comparison to measures installed in 2016/17 (164) may also be attributable to a CVN introduced in May 2017.

The purposed of this CVN was to ensure that the Warmer Homes Scotland budget was not disproportionally targeted to install EWI in properties that other Government funded schemes or funding sources were not willing to cover, primarily non-traditional property types that require a bespoke structural solution. These solutions typically attract greater costs and liabilities than non-structural solutions. Those customers affected by this CVN will be offered alternative measures identified by Warmworks as being suitable for their property type and may be referred back to Home Energy Scotland to enquire about alternative funding options available.

In June 2017, a further CVN was introduced to benefit those fuel poor households living in Residential Park Homes. This amended the technical specification for External Wall Insulation to include Residential Park Homes. Prior to this, a technically suitable EWI system with an appropriate guarantee was not available under the scheme for these properties.

The CVN ensured that Warmworks could utilise a PAS2030 approved approach to assist eligible households living in Residential Park Homes who could benefit from External Wall Insulation. During the period June 2017 - 31 March 2018, 14 Residential Park Home households were able to benefit from External Wall Insulation to their properties, resulting in their properties being warmer and more affordable to heat.

Recommendation 3 - The trends for the installation of both internal and external insulation measures offered under the scheme should be reviewed and analysed in the 2018/19 review to establish if the scheme is continuing to provide insulation measures to improve the energy efficiency ratings of eligible properties inhabited by those households living in or at risk of living in fuel poverty. The analysis should also identify and examine regional trends in insulation measures installed.

Recommendation 4 - Review the data held on RdSAP ratings and locations and establish the relationship between the property type receiving measures installed under Warmer Homes Scotland and the RdSAP improvements post installation, with a view to establishing if no longer offering heating measures to those households in the private rented sector has impacted on SAP points gained. The review should also consider if the increase in the installation of energy efficient glazing and doors during 2017/18 results in a further decrease in SAP points gained during 2018/19.

Recommendation 5 - Carry out an in-depth analysis of the SAP points gained data to establish the associated investment and carbon emissions savings or SAP point gains per recipient household. This should include an analysis of SAP point gains by Measures installed and fuel types.

The available data from 2017/18 indicates that Warmer Homes Scotland is having a positive impact on customers' energy demand levels and associated energy-based financial outgoings. In total, during 2017/18 the scheme delivered 7,757 tonnes in CO₂ savings and this directly contributed to the Scottish Government's ambitious emissions reduction targets.

Table 5 - Breakdown of measures installed in 2016/17 and 2017/18

Measure Name	2016/17	2017/18
Air Source Heat Pump	32	70
Biomass Boiler	3	2
Biomass Boiler - Back Boiler	0	0
Building Fabric Electrical	0	0
Cavity Wall Insulation	170	95
Central Heat Pipe Enclosure	301	213
CO Detector	4663	4121
District Heating	0	0
Draught Proofing	250	188
Electric Load Upgrade	125	127
Electric Storage Heaters	242	301
Energy Efficient glazing/doors	558	999
External Wall Insulation	164	131
Flat Roof Insulation	23	15
Flexible Thermal Linings	0	0
Floor Insulation	84	53
Flue Gas Recovery Device	57	0
Gas Boiler LPG	281	200
Gas Connection	574	484
Gas Fired Condensing Boilers	3770	3327
Heating Hot Water & AC Control Hot Water Systems	4010	4256
Heating Secondary Systems	3542	3235
Heating System Insulation	3547	3954
Hot Water Systems	236	353
Hybrid Wall Insulation	2	0
Internal Wall Insulation	68	32
Lighting Fittings	0	0
Loft Insulation	703	500
LPG Detector Monitor	249	179
Mechanical Ventilation	0	0
Micro Combined Heat and Power	0	0
Micro Hydro Systems	0	0
Oil Fired Condensing Boilers	468	453
Pitched Roof Insulation	26	10
Secondary Pipework Radiators & TVR Repairs	344	329
Smoke Alarms	5257	5257
Solar Blinds Shutters and Shades	0	0
Solar PV	3	5
Solar Thermal	1	6
Underfloor Heating	0	0
Variable Speed Pump and Fan Drives	23	2
Warm Air Heating Systems	0	0
Water Efficient Taps	0	0
Wind Turbines	0	0
Total	29816	28903

Figure 12 - Climate change related findings