Home Energy Schemes 2009-10: Energy Assistance Package and Home Insulation Scheme: End Year Report

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3 Learning from EAP year 1

The Energy Assistance Package is much broader in scope than the previous Central Heating and Warm Deal Programmes, with the energy companies becoming important delivery partners at both Stages 2 and 3, the introduction of energy tariff referrals, families eligible for grant-funded heating measures, and a wide range of measures available. In its first year, officials and delivery partners have learnt several lessons, which are informing the development of the programme.

3.1 Reporting

We are working with delivery partners to improve the processes that will allow us better to track progress, at all stages:

  • Stage 2: reporting by the Pensions Service was suspended while the DWPIT system was being replaced, although income maximisation continued, so that the reporting of outcomes for many referees are incomplete, with benefits being under-reported;
  • Stage 3: delivery partners' reporting cycles are lengthy and it is difficult to determine the pace of installations; one partner is yet to return a full account of the status of referrals;
  • Stage 4: mis-coding issues meant that the profiling of installations was mis-reported, from February, but the data-cleaning process is now complete.

Officials are continuing to work with delivery partners to improve the scope and quality of reporting.

3.2 Level of Stage 2 and 3 referrals

EST undertook research to gain insight into the reasons why a substantial proportion of people who call the ESSacs about the Energy Assistance Package are not referred for Stages 2 or 3. The sample is relatively small and unstructured, being based on not quantitatively significant, but the findings give an indication of the potential proportion of EAP customers likely to be eligible for Stages 2 or 3, and why some of those refuse referral. Their findings are summarised below.

48% of the sample were thought not to be eligible for a check, on the basis of the information they provided, the most common reason being that their incomes are higher than the qualifying threshold. 15% declined to answer the questions relating to benefits so it was not possible to evaluate their eligibility. Of the 37% who could have been referred for checks, 47% declined referral, mostly because they either did not believe that they were eligible and/or felt uncomfortable getting help from benefits.

EAP advisors who carried out the survey see it as their role to convince customers to go forward for benefits checks wherever they can. However, the advisors have limited ability to influence customers against their initial wishes and over-persuasion risks passing low-quality leads to the Pensions Service and CAD. The training of advisors is being reviewed to see if they can be more effective in addressing clients' perceptions about benefits.

The survey suggests that two thirds of callers are not eligible for social tariffs, on the basis of the information they provided. Of these, 48% were not in receipt of qualifying benefits and 40% were either not spending enough of their income on fuel or their income was too high. 95% of customers answered the questions relating to social tariffs, and only 14% of those eligible declined referral, indicating clients are more comfortable engaging with social tariffs than with benefits. It appears that the EAP advisors are harvesting nearly all eligible referrals.

The EST survey shows that only 27% of callers were thought to be eligible for Stage 3, on the basis of the information they provided; most customers could not be referred, as they were either ineligible or their properties were already insulated or could not take the available measures. Nobody declined the questions on stage 3, but 29% of eligible callers declined a referral, citing issues such as dislike of disruption. Officials continue to work with the EST and the CERT providers to identify ways to maximise requests for Stage 3 referrals,

3.3 Contact rates for Stage 2 energy tariff and Stage 3 referrals

The process of signposting customers to their electricity supplier for cheaper energy tariffs was replaced by direct referrals in October 2009. The proportion of households getting a social tariff is higher for those referred (17%) than for those signposted (9%). Nonetheless, as the energy provider is unsuccessful in contacting households, for 61% of Stage 2 referrals the Scottish Government is exploring with EST and the delivery partners ways to improve the rate of contacts.

For households referred for Stage 2 social tariffs and Stage 3 insulation, the energy companies have not been able to contact the applicant in a high proportion of cases. EST and the energy providers are investigating options that may improve the rate of contacts, such as in-call transfers.

3.4 Relationship between Stage 3 and 4

The relationship between Stages 3 and 4 proved difficult in practice. Initially, Stages 3 and 4 were run sequentially, resulting in long customer journeys and occasionally customers were disqualified from Stage 4 due to work undertaken at Stage 3. In order to avoid delays and ensure fairness, the stages were conflated, with all work undertaken by the Managing Agent. Any customers who had been disqualified from Stage 4 due to Stage 3 work had their applications reinstated.

The conflation of stages meant that the government paid for work that could have been funded under CERT, but this was thought acceptable as an interim measure, given the benefit to customers. Changes to processes have been implemented in 2010-11, whereby anyone thought likely to be eligible for both Stage 3 and Stage 4 work is referred for a Stage 4 survey and any work that is thought eligible for Stage 3 is referred to the CERT providers simultaneously with Stage 4 work by the Managing Agent. The effectiveness of this arrangement is being monitored.

3.5 Stage 4 delivery times and waiting times

Delivery times were extended for many customers and too many 2009-10 customers were still waiting for installations by the end of August 2010. Of the 1,340 heating system and 156 insulation-only EAP referrals still waiting for installations, 1,115 heating (83%) and 140 insulation-only (90%) have been waiting for more than 120 days. There are also 10 CHP jobs, who have waited more than 120 days. The greatest concentrations of households waiting are in Eilean Siar and Highland, primarily for oil and electric storage heating.

Sometimes, there are multiple causes of delay. The most common reasons identified for delays are:

  • customers deciding between a choice of heating technologies, requiring additional surveys;
  • customers needing to find contributions where the cost of work exceeds the grant cap or where they wanted additional work to be undertaken.
  • new connections to the mains gas network and electrical load checks, which are the responsibility of regulated third parties and only partly subject to delivery time conditions.

However, there was also insufficient resourcing in certain areas to match demand for off-grid technologies. Scottish Gas has been tackling this to better meet demand, by recruiting more surveyors and more contractors for off-grid technologies, and by upskilling existing contractors to achieve qualifications for the installation of oil and LPG-fired heating systems. This report will be updated in February and will demonstrate progress for the referrals that were outstanding at the end of August.

Going forward, the new Managing Agent contract sets considerably more demanding requirements that are designed to improve performance throughout Scotland. The key performance indicators focus on delivery within 60 days, quality of installations, and customer satisfaction. As part of its response to this challenge, Scottish Gas is opening three Green Skills Hubs which will both build skills for non-gas technologies and serve as operational hubs to improve delivery rates throughout Scotland.

3.6 Promotion of the EAP

The introduction of the Energy Assistance Package was promoted through:

  • outreach work with partner organisations;
  • direct mailing;
  • TV, radio, and press advertising;
  • PR activities, resulting in TV, on-line, and press features.

The number of enquiries rose across the year, clearly boosted by direct mailing and TV campaigns. Direct mailings were carefully targeted, including one that was successful in eliciting applications from people in residential mobile homes. There was also clear evidence of the impact of cold weather from mid December, following an exceptionally mild autumn. Referrals to the EAP have also been boosted by enquiries generated in the Home Insulation Scheme areas, most notably in Eilean Siar.

Whilst marketing activity was in large part focussed on pensioners and families in private sector housing who are likely to be eligible for Stage 4, it became evident that Stages 2 and 3 required different targeting. Scottish Government and EST are developing marketing activities to extend awareness of the programme to these different groups this winter.

3.7 Low carbon technologies

Air source heat pumps

We have encouraged applications for air source heat pumps ( ASHP) and have found that they represent a viable option for rather less than a third of the 584 considered for this technology. Whereas ASHPs may be appropriate for well-insulated new homes, the challenges of hard-to-treat homes and ancillary costs often preclude their use.

Where there is a poor standard of insulation, there is a risk with currently available electricity tariffs, that energy bills might be increased by an ASHP. If the only option is non-cavity wall insulation, the cost of installation will exceed the grant limits so that this is not an affordable option for most customers. ASHPs distribute heat at low temperatures and, for some homes, the space required for radiators would prove impractical.

Scottish Gas has adopted an appropriately professional approach to ASHP installations and has developed exemplary standard processes. Mitsubishi, the ASHP supplier, provided training for all relevant personnel, including heating insulation contractors, technical surveyors, eligibility surveyors, and Scottish Gas contract managers, personal customer managers, and other office staff.

There is careful evaluation of criteria that include the potential for additional insulation, the current fuel type, the customer's pattern of occupancy and use of hot water, and the space needed to accommodate larger radiators, a larger cylinder, and the ASHP unit. Particular attention is given to guidance to customers, including advice on the operation of an ASHP and the need for an appropriate tariff.

ASHP installations progress more slowly than other fuels, requiring load checks by electricity providers in all cases, often followed by electricity supply upgrades and meter changes. Planning permission has been required in almost all cases, including noise impact assessments. Customer contributions are usually required, with costs increased by planning fees and noise tests.

Scottish Government continues to be committed to the use of air source heat pumps, provided they are installed to the exacting standards developed during the first year of the EAP.

Other low carbon technologies

Scottish Government officials continue to seek technologies to tackle the challenges of the Scottish housing stock. It is intended that micro Combined Heat and Power units, operated by LPG, and room-in-the-roof insulation will be added to the options in 2010-11.

Officials are also investigating the feasibility of various schemes that are offering installations of photovoltaic systems in return for feed-in tariffs, for homes that use electrical heating technologies, including heat pumps.

3.8 Continual improvement

Scottish Government officials continue to work with all the delivery partners to improve the EAP. Among the most successful processes are:

  • the independent monitoring and inspection system, which has led to quantifiable improvements in both customer service and the quality of installations;
  • customer service review meetings, which have examined various issues and used them to improve processes, from the initial phone call through to the collation of customer feedback.

3.9 Strengths of the EAP

The Energy Assistance Package:

  • is leading the UK in tackling some of the hardest to treat properties, including residential mobile homes and crofter's cottages;
  • has developed cost-effective packages of both internal and external insulation and can offer both room in the roof and under-floor insulation as well as loft and cavity wall insulation;
  • is making progress with responsible installations of new technologies, including air source heat pumps and micro CHP units, fired by LPG;
  • is run in a spirit of partnership and continual improvement, with a willingness to adapt the scope of the scheme to meet the needs of fuel poor people, advised by the independent Fuel Poverty Forum;
  • has already helped over 67,000 EAP households as well as earlier applicants, with more than 16,000 having their homes made more energy efficient and easier to heat, under Stages 3 or 4;
  • is helping people based on individual circumstance, complementing the area-based approach of the Home Insulation Scheme;
  • is making a real difference to the lives of 1,000 owner occupiers and the tenants of private landlords each month, as well as working with local authorities and housing associations;
  • is making improvements that will reduce energy use, and energy bills for many years to come;
  • is providing jobs and training for over 370 people, helping the economic development of communities around Scotland.

3.10 EAP customer feedback

Examples provided by the Energy Saving Scotland advice centres and by Scottish Gas Personal Customer Managers include:

  • "Delighted with the whole service, especially "promptness", "pleasant" and "good service" and said he was very grateful."
  • "The complete system is very user friendly from the positions of the radiators to the time switch and thermostat placed at eye level. The service I received was first class from the carpet fitter to the fitters everyone was very friendly and happy."
  • "I cannot thank you enough. I no longer have a chilly flat even when the heating is off. It's comfortable as I have said already ten star rating I have already recommended the EAP to friends and family. I am very grateful to the Scottish government stage four of the energy assistance package carried out by Scottish Gas. It's made a difference to me living in this flat."
  • "I am not good at gadgets and technology etc, but now that I am becoming familiar with this system, I realise it is very versatile and straightforward and certainly not as complicated as I imagined it would be. I have been very impressed with the excellent attention & efficiency with which this whole procedure has been carried out. Also pleasantly surprised at so little disruption during the installation. My sincere thanks to all concerned."
  • "Although I haven't needed to use the heating, the fact that I shall have controllable heat 24 hours a day is wonderful. I am actually looking forward to the winter!"
  • "Explained method of use well, worked well & cleaned up satisfactorily. Delivery of heaters was punctual & efficient. The workmen were very efficient."
  • "Delighted with system and are impressed with outside boiler especially as we have a small bungalow we are delighted with the service and the lads who came to use where polite cheerful and just got on with the job with a minimum of disruption what pressure to have such a good team from start to finish we are happy with the work done."
  • "My mother was very happy with all the work that was done and the staff was wonderful and well mannered."
  • "I am delighted and rather than dread the winter coming I can look forward to being snug and cosy."
  • "Workmen are an asset to firm who carried out work. Lovely young men. Electrician also very good. As I have only used hot water I don't know how well system will be. The men did put on heating when testing & it was very good."
  • "Absolutely great it will save me money as I can switch it off when I like can't thank you enough as I could never afford to have it put in."
  • "I have had nothing for nothing in my life and was amazed that we qualified for this due to our 11 month old daughter didn't believe it would actually happen but it has and we are incredibly grateful."
  • "This is going to make such a difference when the weather gets colder. I shall have more control over when the heating is required. Everything went superbly. Cannot think what more could be done."