Forecasts suggest the Green Deal will help to support up to 60,000 jobs in the insulation sector by 2015 – up from around 26,000 today. While this is a great opportunity in employment terms, the initiative, together with the accompanying Energy Company Obligation (Eco), is sure to put a massive strain on the industry – from equipment manufacturers and Green Deal assessors, to skilled tradesman undertaking retrofit work and waste management companies processing removed materials.
So, are Green Deal providers and their suppliers ready to deliver on the scheme’s promises? Angus Wilby, head of energy services at EDF Energy, certainly thinks so, and believes supply chain partnerships are the key. “Strong links with suppliers are vital to making the Green Deal a success,” he says. “Many large or small enterprises with aspirations to be providers will have little or no experience in this new marketplace. One route for these companies will be to partner with companies offering the broadest possible range of services.
“However, we know that for some measures, existing installations are currently performed by small, local operations, which will also have a role in delivering both the Green Deal and Eco.”
Outlining EDF Energy’s supplier management, Wilby continues: “We are building upon existing relationships within the supply chain and will develop new ones throughout 2012. Our goal is to ensure customers get the experience they deserve and are able to trust not just us, but those partners who will be working in customers’ homes on our behalf.”
The opportunity to effectively create a new market within the sector is one that EDF Energy is keen to play its part in.”We are continually in discussion with companies of all sizes across the energy efficiency and microgeneration sectors,” Wilby confirms. “If there are businesses of any size that see an opportunity to grow business under the Green Deal, they should make contact with the Department of Energy and Climate Change as well as energy suppliers. There will always be ways that like-minded organisations can act together to meet the conditions of entry and achieve Green Deal provider accreditation.”
Another of the big six, Npower, is aiming to use the relationships it has built with long-standing suppliers in delivering the Community Energy Saving Programme (Cesp) and Carbon Emissions Reduction Target (Cert). “This will ensure we have a network of suppliers, including manufacturers, contractors and advisers with the expertise and capabilities to help us deliver the Green Deal,” explains business development director David Titterton.
“Having worked with Npower before, these partners understand us as a company and therefore the opportunities and challenges for us. Working with trusted suppliers is an integral part of ensuring both the success of Green Deal, and the cost-effectiveness to Npower of integrating it.”
Titterton agrees that the Green Deal represents a significant opportunity for the industry, but is also quick to emphasis the challenges it will bring. “Because of the Eco, energy companies are the only parties that are obligated to implement the Green Deal, so we have to make it work,” he says. “The main opportunity is for those in the supply chain. They have more control over their level of involvement, thereby choosing options that are beneficial and avoiding those which are a potential risk. Energy companies do not have this luxury and so we are under more pressure to make the Green Deal a success.”
Supply chain specialist DHL is engaged with the All-Party Parliamentary Group and Green Deal Providers Working Group to gain greater insight into the impact and challenges of the programme. Adam Franklin, managing director of the company’s industrial UK business, says the supply chain has to be up to the logistical challenge of the Green Deal. “The challenge is getting the right retrofit materials to the right place at the right time,” he says. “Every stage of the process, from design to distribution, needs to be perfectly managed. Any weak link in the chain could cause delays and cost overruns. Managed effectively, the rollout, returns and recycling requirements of the Green Deal present an opportunity for not only a more efficient, more environmentally friendly operation, but critically, the opportunity to improve adoption of the Green Deal.”
DHL has developed a similar model for the industry to support smart meter rollouts. This infrastructure can be leveraged to support the Green Deal – and reduce cost. Franklin explains: “Reduced engineer downtime means more time undertaking the retrofit, as opposed to travelling to collect materials and dispose of waste. By reducing the labour cost, it may mean a reduced payback – the difference between a home hitting the ‘golden rule’ or not.
“It’s critical to consider carbon impact, too, through reducing the miles from point of manufacture to final installation, and appropriately managing waste. Providers and the government must work closely to ensure a supply chain is implemented that is capable of meeting the requirements of such a vast retrofitting project.”
Lee Jones is a freelance journalistEquipping the workforce
A vital aspect of preparations ahead of the Green Deal’s rollout is ensuring there is a fully-trained workforce in place to undertake installation projects. In March, the government – in co-operation with Asset Skills and Construction Skills – allocated £3.5 million to train up to 1,000 insulation installers and 1,000 assessors to its new National Occupational Standard for Green Deal assessment. This training will also include the validation of existing installer training courses to meet the new Green Deal PAS 2030 requirements, and the training of trainers to ensure quality courses are available.
The government will explore the value of a second tranche of funding for training later in the year and plans to ensure its wider Apprenticeship Frameworks support not only the Green Deal, but also sustainable construction more generally.
This article first appeared in Utility Week’s print edition of 3 August 2012.
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