500 homes to pilot Pay As You Save (PAYS)

COPENHAGEN STARTS AT HOME – MILIBAND

· First day of global climate talks kick off today in Copenhagen

· Great British Refurb trials to pioneer financing of home energy makeovers

· Energy Bill to get fair deal for consumers and support clean coal

As talks aimed at securing a global climate deal kicked off in Copenhagen today, UK Energy and Climate Change Secretary Ed Miliband announced steps in the UK aimed at helping householders make their contribution to cutting emissions. The Government’s Energy Bill also has its second reading in the Commons today.

Homeowners in Birmingham, Sunderland, the London Borough of Sutton and Stroud will be testing out new ways to finance whole house energy makeovers under the Government’s £4m Pay As You Save scheme. Following an open competition, Birmingham City Council, Gentoo Sunderland, British Gas, B&Q UK and Stroud District Council have been chosen to deliver individual projects in the first ever UK trials.

The Home Energy Pay As You Save pilots will give households the opportunity to invest in energy efficiency and microgeneration technologies in their homes with no upfront cost. Householders will make repayments spread over a long enough period so that repayments are lower than their predicted energy bill savings, meaning financial and carbon savings are made from day one.

A total of around 500 homes across England will take part in the trial which will provide evidence of how to foot the bill for the Great British Refurb – the Government’s plan to make the 26 million existing homes in the UK more energy efficient.

Energy and Climate Change Secretary Ed Miliband said:

“The next two weeks in Copenhagen are crunch time for the planet. The UK has taken a lead in putting solutions on the table throughout the process so far and I’ll not rest until we have the most ambitious, effective and fair deal possible.

“Our credibility abroad is based on our ambition at home. We’re the first country to put carbon targets into law, and our target of an 80% reduction by 2050 is one of the most ambitious.

“Many British householders want to reduce their emissions, but are put off by the upfront cost of installing insulation, solar panels or ground source heat pumps. Pay As You Save will trial different ways of paying for this work so it’s affordable.

“One quarter of the UK’s total emissions come from homes, so householders have to be a part of the solution to climate change. Increasing the energy efficiency of homes not only helps reduce emissions, but will also help reduce fuel bills.”

DECC is keen to learn whether the PAYS scheme is attractive to consumers and how, in the medium term, it could be a method for enabling more householders to invest in the energy efficiency of their homes.

The Energy Bill, which receives its Second Reading in the Commons today will:

Protect vulnerable households

• By providing mandatory social price support, such as in the form of an electricity bill rebate. This builds on the success of the voluntary agreement with energy companies which ends in 2011 and has helped reduce the fuel bills of more than one million vulnerable customer accounts. The level of support to be provided through the new mandated scheme will be greater than the £150m committed by suppliers in the final year of the agreement.
• Making absolutely clear that Ofgem, the energy market regulator, must:- include the reduction of carbon emissions and the delivery of secure energy supplies in their assessment of the interests of consumers
  - step in proactively to protect consumers as well as considering longer term actions to promote competition.
• Giving Ofgem additional powers to tackle market exploitation where companies might take advantage of constraints in the electricity transmission grid.
• Strengthening the deterrent nature of Ofgem’s powers by extending the time limit from 12 months to 5 years within which Ofgem can impose financial penalties for breaches of licence conditions.

Put UK at the forefront of developing CCS technology

• The new CCS Incentive will support the construction of up to four commercial-scale CCS demonstration projects in the UK.
• The CCS Incentive could also provide funding for the retrofit of demonstration projects to their full capacity, should it be required in future.
• This Bill will strengthen the UK’s leadership position in the development of clean coal technologies that could bring between £2-4 billion a year into the UK economy by 2030, and support between 30,000-60,000 in jobs such as engineering, manufacturing and procurement.

ENDS

Notes to editors:

1. The PAYS pilot will run until April 2011.

2. Around 500 homes across England will take part.

3. A total of £4m in funding has been awarded from DECC to pay for the pilots. The pilot is managed by the Energy Saving Trust. The Energy Saving Trust (www.energysavingtrust.org.uk) is the UK's leading organisation set up to try and prevent climate change by helping everybody to cut carbon dioxide emissions – the main greenhouse gas causing climate change – from their homes and transport. For free energy saving advice call a local Energy Saving Trust advice centre on 0800 512 012.

4. The pilot will run with 5 partners:

· Gentoo Group Ltd: Registered Social Landlord, Gentoo Group Ltd will be working with householders in the North East. Over the next 18 months Gentoo will identify a mix of both void and occupied properties in the Sunderland area which they will retrofit with energy efficiency and microgeneration measures.

· British Gas: British Gas will use its market research to test householder’s reactions to finance options. Homes will receive a whole house audit and a personalised energy saving report. It will also be exploring new ways to present energy usage, energy bills and the PAYS repayment in a way that helps householders better understand energy consumption in their homes.

· Birmingham City Council: Birmingham City Council’s activity will form part of the £35m Green New Deal (GND) project. For the PAYS project householders will receive whole house assessments. The project will be delivered in partnership with Birmingham Credit Unions which will manage the repayment process. The project will take advantage of existing funding sources where possible such as Warm Front and other regional or local funding.

· B&Q UK: B&Q UK will lead a PAYS project in partnership with the London Borough of Sutton and the Bioregional Development Group (BDG). To deliver the project B&Q UK will develop its advice services to include training for Eco Advisers and the introduction of a ‘Shop Within A Shop’. Homeowners will be allocated a project manager to help them through the entire process. London Borough of Sutton will manage the repayment process and BDG will support with training and evaluation.

· Stroud District Council: As part of Stroud District Council’s (SDC) wider programme of carbon reductions – Target 2050, it will work with Severn Wye Energy Agency (SWEA) to deliver energy saving home improvements in local homes. SDC will manage the repayment process and SWEA will project manage the installation process throughout. During the pilot phase, SDC will open a selection of local ‘exemplar properties’ to showcase energy saving technologies in-situ.

5. For more information on the Energy Bill: www.decc.gov.uk/energybill.