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Proposed amendments to the Boiler Upgrade Scheme Regulations

Proposed amendments to the Boiler Upgrade Scheme Regulations – GOV.UK (www.gov.uk)

Closing Date: 12 October 2023
Response submitted by: National Insulation Association
For more information, please contact: info@nia-uk.org

About the National Insulation Association The National Insulation Association (NIA) represents the insulation industry in the UK with a member base comprised of installers, system certificate holders, and manufacturers who provide a wide range of insulation solutions for homes and buildings. The NIA and its members are fully committed to maintaining and raising standards within the insulation industry.

Should we maintain the current requirement for a valid EPC with no outstanding recommendations for loft or cavity wall insulation?

Yes, the current requirement for a valid EPC with no outstanding recommendations for loft or cavity wall insulation should be maintained. These minimum insulation requirements are vital to make sure that properties are ready for the transition to low-carbon heat. Removing these requirements would create a number of risks, particularly for consumers who may see increased costs and worse outcomes as a result.

Firstly, if heat pumps are installed in properties with inadequate insulation, there is a risk that those heat pumps will have overly expensive running costs, as heat pumps are most effective in properties with a high thermal efficiency. Making sure that a home has adequate insulation prior to installing a heat pump is essential to safeguard consumers from potential energy bill increases. The current level of the energy price cap means that the unit price for electricity is almost 4 times higher than that for gas.1 Therefore, to ensure that consumers do not see higher prices, insulation minimum requirements are absolutely vital to provide the right internal conditions for heat pumps to run as efficiently and as affordably as possible. In this way, insulation has a crucial role to play to ensure that the transition to low carbon heat is a just one which does not result in increased costs for consumers. This is particularly relevant within the context of the current cost of living crisis.

Secondly, if a heat pump is installed followed by insulation, consumers may be left with a heating system that is not proportionate with the property’s reduced space heating demand and therefore has capital and running costs that are unnecessarily high. The installation of fabric efficiency measures prior to, or alongside, heat pump installation means a smaller, cheaper heat pump can be installed which will then operate at higher efficiencies over its system lifetime. For these reasons, a fabric-first approach has been incorporated into government policy and accepted as industry best practice for a number of years.

According to the Energy Saving Trust, if a home has an uninsulated loft and cavity walls, it could be losing over half of its heat through those two building elements.2 3 Hence, it is crucial that the current requirement for a valid EPC with no outstanding recommendations for loft or cavity wall insulation is maintained. Now is not the time to abandon the importance of a fabric first approach, which is the best way to reduce consumers’ bills and make sure that the transition to low carbon heat is affordable for all. Removing insulation minimum requirements in the middle of a cost of living crisis could have damaging impacts on consumers.

Consumer confidence is a crucial element of the transition to low carbon heat. The Government has set ambitious targets for the decarbonisation of heat, including to install 600,000 heat pumps per year by 2028, rising to 1.9 million per year by 2035.4 For these targets to be met, consumers must be on board. If residents find that their heat pump is overly expensive or incorrectly sized as a result of inadequate insulation, then this may have damaging effects on consumer confidence, which could hinder the uptake of heat pumps. Thus, the importance of a fabric first approach cannot be ignored, as insulation will be key to ensuring that the transition to low-carbon heat is as smooth and cost-effective as possible for consumers.

If you consider the EPC requirements to be a barrier to uptake, what specifically do you consider to be the issue:

a) Requirement to have a valid EPC
b) Requirement to have a valid EPC with no outstanding recommendations relating to loft or cavity wall insulation
c) Other

Please select one of the above and provide evidence to support your response.

The NIA does not consider insulation requirements on EPCs to be a barrier to uptake.

As outlined in our response to Question 3, a fabric first approach to home decarbonisation is vital to ensure that the transition to low carbon heat is as smooth and cost-effective as possible for consumers. Therefore, we believe that the requirement for a valid EPC with no outstanding recommendations for loft and cavity wall insulation should be maintained.

If we retain the EPC requirements, are there any potential changes we could make to ease the consumer journey without risking heat pumps being installed in unsuitable properties? For example, allowing the submission of an expired EPC with no recommendations for loft or cavity wall insulation.

The main issue preventing uptake of heat pumps via the Boiler Upgrade Scheme (BUS) is the level of grant funding being offered. This has been the main barrier to the success of the scheme thus far, not minimum insulation requirements on EPCs, We are pleased to see that the Government is taking steps to address this, as evidenced by the Prime Minister’s announcement last month that the grant funding level will be rising to £7,500 from 23 October 2023.

The findings of the Lords Environment and Climate Change Committee’s inquiry into BUS, published in February 2023, found that the low level of grant funding was one of the main factors holding back the uptake of heat pumps via the scheme. 6 On average, the £5,000 grant offered by the scheme for an Air Source Heat Pump only represents approximately half of the installation cost. 7 Therefore, even with the BUS grant, households still face substantial remaining costs, which has deterred many from applying for the scheme. As a result, the Committee recommended raising the grant level to address low uptake8 , which the Prime Minister has now implemented in a move that has been welcomed across the home decarbonisation industry.

Since the Government is already removing the main barrier holding back the success of the scheme, there is no need to also remove minimum insulation requirements, particularly due to the risks associated with such a move. As mentioned in our answer to Question 2, the removal of insulation requirements would create substantial risks, including raising energy costs for residents and damaging consumer confidence in the transition to low carbon heating.

If we retain the EPC requirements, are there any potential changes we could make to ease the consumer journey without risking heat pumps being installed in unsuitable properties? For example, allowing the submission of an expired EPC with no recommendations for loft or cavity wall insulation.

The main issue preventing uptake of heat pumps via the Boiler Upgrade Scheme (BUS) is the level of grant funding being offered. This has been the main barrier to the success of the scheme thus far, not minimum insulation requirements on EPCs, We are pleased to see that the Government is taking steps to address this, as evidenced by the Prime Minister’s announcement last month that the grant funding level will be rising to £7,500 from 23 October 2023.

The findings of the Lords Environment and Climate Change Committee’s inquiry into BUS, published in February 2023, found that the low level of grant funding was one of the main factors holding back the uptake of heat pumps via the scheme. 6 On average, the £5,000 grant offered by the scheme for an Air Source Heat Pump only represents approximately half of the installation cost. 7 Therefore, even with the BUS grant, households still face substantial remaining costs, which has deterred many from applying for the scheme. As a result, the Committee recommended raising the grant level to address low uptake8 , which the Prime Minister has now implemented in a move that has been welcomed across the home decarbonisation industry.

Since the Government is already removing the main barrier holding back the success of the scheme, there is no need to also remove minimum insulation requirements, particularly due to the risks associated with such a move. As mentioned in our answer to Question 2, the removal of insulation requirements would create substantial risks, including raising energy costs for residents and damaging consumer confidence in the transition to low carbon heating.

NIA calls on Government to release SHDF Wave 3 in Autumn Statement

NIA calls on Government to release SHDF Wave 3 in Autumn Statement

The government’s recent steps back on green policies are a cause for concern in successfully decarbonising the UK’s homes. Speaking on behalf of its members, the chairman of the National Insulation Association (NIA), Derek Horrocks is calling on the government to sustain the momentum built so far in the sector – and to announce the release of the full £3.8bn of the Social Housing Decarbonisation Fund in the upcoming Autumn Statement, recommitting the government’s net zero manifesto pledge.

Click here to read our letter sent to the Prime Minister.

The UK is often described as having some of the oldest and least energy efficient housing in Europe meaning there is substantial work to be done to decarbonise some 27 million homes if we’re going to meet our ambitious targets. Over the course of this parliament, a long-term plan to fund decarbonisation of social housing has been built, and the scale and ambition of the Social Housing Decarbonisation Fund has attracted significant investment and forward-thinking contributions from the construction industry.

Despite this, Prime Minister Rishi Sunak has chosen to back pedal on a number of green policies that risk substantially slowing progress. This all feels like a big step back in net zero agenda and we’re urging the government to be more ambitious in the short term.

Confidence across the market has been severely shaken through the government’s announcement to scrap policies to force landlords to upgrade energy efficiency in their homes, instead only ‘encouraging’ households to carry out the work. Meanwhile, the phase out of fossil fuel boilers has been pushed back significantly, along with disbanding the energy efficiency taskforce intended to speed up home insulation and boiler upgrades, which was only launched in March of this year.

This may have a knock-on impact for the work in the social housing space, which is the catalyst for everything else. It’s the way we build our supply chain, skills, and innovation – so when businesses in the private decarbonisation sector accelerate this work, the foundation is already there. The government’s commitment thus far has played a key role in forging partnerships between industry, social housing providers, education providers and more to drive retrofit at scale.

Only days before the announcements, the National Housing Federation’s chief executive Kate Henderson urged the government to not let net zero slip down the political agenda and to make sure housing associations have the vital funding required to play their part in meeting targets.

This is a message that the NIA and its members wholeheartedly echo. The decarbonisation sector needs certainty and confidence in the long-term to invest in the supply chain – and it’s clear that the recent announcements have damaged that confidence, causing concern that a step back will come for social housing decarbonisation too.

The Social Housing Decarbonisation Fund (SHDF) has seen great success, but with Wave 2 schemes already allocated that long-term certainty for all is still needed. The PM himself said that his government would ‘continue to subsidise energy efficiency’, and with £3.8 billion already allocated to Wave 3 of the fund, we’re calling on the government to announce and bring forward this funding in the Autumn Statement.

This should be accompanied with details of the competition and an aspiration for successful bids to be announced before the end of the fiscal year. This would be the clear signal to housing providers, and the decarbonisation supply chain to continue the investment in innovation, skills and training at scale – continuing to build the foundation for the drive to net zero.

So much momentum has built over recent years, and we simply cannot let that go to waste and descale the industry. Many contractors and housing providers have invested huge amounts of time, resource and money to invest in the skills, innovation and processes to carry out the work needed – and in many cases has shaped parts of their business plans too when it comes to investing those resources. It’s important that we further the agenda to provide home decarbonisation at scale more quickly and efficiently than ever. Collaboration at scale and a community-driven approach are definitely key to this.

Ultimately, we have to remember that decarbonising homes is about much more than just achieving net zero. It’s also about supporting millions of people feeling the impact of the ongoing energy, cost of living, and health crises too – so the sooner we get these homes decarbonised, the better for society all-round.

We have as a collective, in conjunction with the National Home Decarbonisation Group, written to Prime Minister Rishi Sunak to engage on ensuring the all-important momentum needed. We also look forward to continuing our close working relationship with the government to achieve collective goals, starting with this recommitment to the net zero manifesto pledge in the upcoming Autumn Statement through releasing the full £3.8bn Social Housing Decarbonisation Fund to help decarbonise the UK’s social homes.

Energy Company Obligation schemes: Standard Assessment Procedure (SAP) and Reduced Data SAP (RdSAP) amendments

Energy Security and Net Zero Committee Call for Evidence: Heating our Homes

Energy Company Obligation schemes: Standard Assessment Procedure (SAP) and Reduced Data SAP (RdSAP) amendments – GOV.UK (www.gov.uk)

Closing Date: 11 September 2023
Response submitted by: National Insulation Association
For more information, please contact: info@nia-uk.org

About the National Insulation Association
The National Insulation Association (NIA) represents the insulation industry in the UK with a member base comprised of installers, system certificate holders, and manufacturers who provide a wide range of insulation solutions for homes and buildings. The NIA and its members are fully committed to maintaining and raising standards within the insulation industry.

For ECO4 retrofits where a full SAP assessment is required, do you agree with the proposal to update legislation to require that, after a transition period, only SAP10.2 be used?

The NIA agrees with the proposal to update legislation so that only SAP10.2 should be used, subject to the appropriate transition period.

An update to the SAP2012 framework is long overdue. SAP10.2 is more accurate than the existing SAP2012 framework, and is based on more up-to-date and reliable information. This is especially important given recent large fluctuations in energy prices. Therefore, SAP10.2 will result in more reliable energy performance data, which is beneficial for residents and retrofit businesses.

SAP10.2 will also better support the decarbonisation of homes. By providing a reduced value for the carbon emissions of electricity, it provides a greater incentive to install low carbon, electrical systems. This is an important update, which should help to facilitate and accelerate the transition to net zero homes.1 Since SAP10.2 is already in use across England, Scotland and Wales, industry should be capable of adapting to its use within ECO4 and Great British Insulation Scheme (GBIS) retrofits, especially given the proposed six month transition period.

Do you agree with a six-month transitional period from the date the amended legislation comes into force, during which either SAP2012 or SAP10.2 can be used for ECO4 retrofits that require a full SAP assessment? If not, please provide details of alternative transition arrangements?

Yes, we agree with the proposed six-month transition period. As this is the completion timeline for ECO4 projects that include a district heating element, this is an appropriate length for the transition.

Of the three options presented here for evidencing:
3.1 Which is your top preference and why?
3.2 Which is your second preference and why?

3.1) The NIA’s top preference is Option 2. This option minimises the transitional impact associated with updating from RdSAP2012 to RdSAP10.2 and it also avoids the administrative issues associated with operating two versions of RdSAP concurrently. We disagree with Option 3 because it risks a significant number of properties becoming ineligible for ECO4 funding, which in turn would result in lost business for the industry. It would also mean that fewer households can benefit from vital energy efficiency upgrades. This is an outcome that must be avoided. Modelling carried out by an NIA member, based on 5 different property archetypes with differing retrofit scopes, shows that RdSAP10.2 lowers both properties’ pre- and post-retrofit scores when compared to RdSAP2012. This decrease is particularly significant in projects that include renewables. Under Option 3, many retrofits will need to be evidenced using RdSAP10.2. There is a substantial risk that some of these retrofits will no longer meet the ECO4 Minimum Requirement (MR), particularly those that would have achieved a post-retrofit SAP band of mid to low C. Furthermore, the hard stop in Option 3 is too risky for installers, as a transition period is essential to effectively adjust to the changes to RdSAP. In practice, installers would avoid carrying out work on properties where their modelling shows that the post-retrofit SAP band will be close to the MR, as there is a risk that the project will not meet the MR when converted to RdSAP10.2. This will mean that many households miss out on energy efficiency measures because of the uncertainty involved in Option 3. Changing the goalposts for eligibility and evidencing overnight without any transition period would be disastrous. This would make a lot of projects ineligible and create dangerous confusion among installers. This would have a significant detrimental impact on scheme delivery. The NIA also has concerns about the workability of Option 1. Under this option, two versions of RdSAP would be running concurrently, which would place a large administrative burden on TrustMark and Ofgem as scheme providers. The software is not designed to support two versions of RdSAP running at the same time. Therefore, we have concerns that under Option 1, inadequate infrastructure and extra administrative complexity may delay projects and create bottlenecks within schemes. This will have damaging effects on both residents and installers. There is also a risk that having two versions of RdSAP running concurrently will create unnecessary confusion among installers.

3.2) The NIA does not have a second preference, as we believe that Option 2 is the only viable option. Neither Option 1 or Option 3 are practical or workable solutions for the reasons outlined in our response to Question 3.1.

For options 1 and 2, do you agree that 3 months following the introduction of RdSAP10.2 is sufficient to allow the completion of retrofits?

Yes, we agree that 3 months is a sufficient period to allow the completion of retrofits following the introduction of RdSAP10.2. Within ECO4, the majority of projects are shorter than 3 months. There may need to be some flexibility within this, as some complicated, multi-measure retrofits, particularly ones that may include a change of heating system, may have longer lead times. However, for most retrofits carried out under ECO4, 3 months is an appropriate timeframe. As GBIS is primarily a single-measure scheme, we do not foresee any issues with completing retrofits in 3 months under this scheme.

If RdSAP10.2 is introduced into other schemes, such as SHDF, which include large scale retrofit projects, then the transition period may need to be longer than 3 months. This is something the Government will need to consider when it introduces RdSAP updates into other schemes. However, considering most ECO4 installations are small retrofit projects, a 3 month period to allow completion should be achievable

Option 2 involves converting pre-retrofit SAP ratings from RdSAP2012 to RdSAP10. When this conversion takes place on the pre-retrofit SAP rating, there is a chance that some ECO4 retrofits may no longer meet the ECO4 minimum requirement (MR). What do you think the best approach would be to minimise this risk?

While we agree that Option 2 is the only viable option, we recognise the risk that some ECO4 retrofits may not achieve the MR once converted to RdSAP10.2, which will normally result in a lower SAP rating. It is vital that this risk is mitigated as much as possible, so that vulnerable households do not miss out much-needed energy efficiency upgrades and installers do not lose out on business.

We believe that the consultation’s proposal for installers to pre-lodge a post installation EPR based on RdSAP2012 to prove that they would have met the MR is a sensible approach to minimise this risk. Installers will generally carry out their own modelling before embarking on a retrofit project to forecast expected outcomes and ensure that they will meet the MR. This should provide sufficient evidence that a project would have met the MR, as long as, once the install is completed, installers verify that they have installed the measures included in the EPR.

Lowering the MR by half a SAP band is also a viable option. Although it is not as accurate or dwelling-specific as a pre-lodged EPR, it is a fairly simple approach which would not add much administrative complexity. It would also mitigate the risk of projects failing to meet the MR.

Under Option 2, the Building Research Establishment (BRE) would need to publish its conversion methodology, which would enable installers to quickly and easily convert pre-retrofit SAP ratings from RdSAP2012 to RdSAP10.2. To ensure that the change from RdSAP2012 to RdSAP10.2 runs as smoothly as possible, it is important that the BRE publishes this conversion methodology well in advance of March 2024 (the expected changeover date). Before the RdSAP updates come in, energy efficiency businesses will need time to gather existing data points and then go through existing EPCs, converting them to RdSAP10.2. Thus, it is critical that the Government decides on an approach and the BRE publishes its conversion methodology as soon as possible so that industry has sufficient time to prepare and adapt to the changes.

Do you agree with our proposal to not require Ofgem to update their scoring methodology for ECO4 following the change from SAP2012 to SAP10.2?

Yes, we agree with this proposal, as updating scoring methodology at this stage would create extra administrative complexity, which could impact upon scheme delivery.

Do you agree with our proposal to not require Ofgem to update their scoring methodology for the GB Insulation Scheme following the change from SAP2012 to SAP10.2?

We have concerns that the RdSAP and SAP updates will lead to properties being excluded from schemes. While we agree that an update of RdSAP and SAP is needed, it is vital that the Government implements the changes in a way that will mitigate the number of households being excluded from schemes.

As previously discussed in our response to Question 5, there is a risk that properties which would have achieved a post-retrofit score of mid to low SAP band C under RdSAP2012 may now drop into band D under RdSAP10.2. This could lead to a significant number of previously eligible properties now missing the MR. For installers, it will be too risky to treat marginal properties that may no longer meet the MR under RdSAP10.2 In practice, this could mean lots of vulnerable households are excluded from energy efficiency upgrades.

In order to achieve the scheme’s delivery targets and the UK’s net zero targets, it is important that energy efficiency upgrades are delivered to as many homes as possible. The UK has some of the least energy efficient properties in Europe2 , with many properties in urgent need of upgrade. According to the Office for National Statistics, 704,000 properties in England are still rated E, F and G.3 It is vitally important that the RdSAP/SAP update does not result in vulnerable, lowincome households missing out on much-needed support. National Energy Action’s latest estimates show that there are currently 6.6 million households in fuel poverty.4 As a result of energy price rises over the last year, millions of households across the UK are now struggling to pay their energy bills.

Thus, the Government’s primary consideration when implementing these changes must be to mitigate their impact on vulnerable, fuel poor households. As such, it is crucial that they take steps to ensure that as few households as possible become ineligible for energy efficiency support as a result of RdSAP/SAP updates. To minimise this risk, the NIA supports the Government’s proposed mitigation options, such as enabling installers to pre-lodge a postinstallation EPR and lowering the MR by half a SAP band.

Another issue which could arise from the updates to RdSAP/SAP concerns their interaction with the Minimum Energy Efficiency Standard (MEES). Since RdSAP10.2 generally leads to lower SAP scores than RdSAP2012, there is a risk that some private rented properties, which would have previously achieved MEES under RdSAP2012 may now no longer be compliant under RdSAP10.2. For instance if a landlord has upgraded their property to a SAP band of mid to low C in order to be compliant with proposed changes to MEES, there is a chance that a new EPC carried out using the RdSAP10.2 methodology would give the property a SAP rating of D, thus meaning the property will no longer be compliant once MEES rises to EPC C. While the NIA is supportive of MEES and efforts to raise levels of energy efficiency levels in the private rented sector, we would urge the Government to consider the interaction between RdSAP changes and MEES. This includes offering support where necessary to landlords and tenants to ensure that as many as properties as possible remain compliant with MEES.

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Energy Security and Net Zero Committee Call for Evidence: Heating our Homes

Energy Security and Net Zero Committee Call for Evidence: Heating our Homes

Call for evidence – Committees – UK Parliament

Closing Date: 25 August 2023

Response submitted by: National Insulation Association

For more information, please contact: info@nia-uk.org

About the National Insulation Association

The National Insulation Association (NIA) represents the insulation industry in the UK with a member base comprised of installers, system certificate holders, and manufacturers who provide a wide range of insulation solutions for homes and buildings. The NIA and its members are fully committed to maintaining and raising standards within the insulation industry.

What policy changes are needed to deliver energy efficient homes across the UK?

Homes in the UK account for 26% of greenhouse gas emissions and are amongst the least energy efficient in Europe.1 The NIA therefore believe ambitious targets need to be set to address this. This includes the following policy changes:

1. Additional funding and long-term commitment to existing grant and loan schemes. This will ensure wider access for homeowners and landlords to energy efficiency measures. Across all available schemes, low and high-cost measures should be offered to ensure the most appropriate solution is provided to households. Insulation should be prioritised as it supports a fabric first approach, which significantly reduces heat loss from a building and reduces energy bills, whilst also minimising exposure to health hazards. The NIA suggests that though insulation measures should be made available to a wide pool of applicants, given the size of the challenge to decarbonise housing, the worst-first approach can be helpful to ensure households with the lowest EPC ratings and those in fuel poverty are improved quickly. Requirements for suppliers taking part in the schemes must be monitored to ensure their continued contribution, with suitable consequences for targets not being met. Clear and straightforward pathways to funding for applicants and installers will avoid delays, which have historically reduced the effectiveness of these schemes. To prevent the ‘stop-start’ nature that has previously disincentivised engagement from industry, the Government must set out clear processes for engagement with minimal administrative burdens.

2. Minimum Energy Efficiency Standards (MEES) for both new and existing homes. The Government has proposed a target for the Private Rented Sector (PRS) to reach a minimum EPC Band C by 2028 (for existing tenancies2 ), which the NIA supports. However, this should be expanded to cover all housing tenures to ensure progress in energy efficiency. Enforcement of these standards is a crucial aspect of the policy changes that the NIA would like to see. The NIA urges the Government to release the results of the consultation on MEES in the PRS as this would push forward progress and set a framework to follow across other tenures.

3. EPC reform to facilitate energy efficiency upgrades across the UK. The recent Scottish EPC reform consultation set out some important changes that will support the accurate assessment of EPCs, including a new set of metrics for domestic and non-domestic EPCs and greater focus on the fabric efficiency of the building. The NIA supports the use of these metrics and hold the view that by focusing on fabric efficiency the number of homes with poor energy efficiency can be reduced.

What are the key factors contributing to the under-delivery of the UK’s government-backed retrofit schemes?

1. Poor scheme design. The under-delivery of government-backed retrofit schemes is a result of poor scheme design. Often governments design a scheme to achieve their own political goals, but do not engage enough with the supply chain to make sure that the scheme is deliverable. To avoid this, earlier consultation with key stakeholders who are directly involved in scheme delivery, such as retrofit businesses, is needed. This is important as delivery organisations are often consulted too late in the process, at which point there is little opportunity to influence and improve the design of schemes.

2. Schemes are too short. Another common issue is that retrofit schemes are too short-term, which prevents them from being a success. Manufacturers, installers and the wider supply chain need to invest and prepare for a scheme. For many businesses, this investment is not economically viable for a short time period. There is a lot of paperwork and onboarding involved with working on government retrofit schemes, which is not always straightforward. It also costs a lot in product development and certification for manufacturers and installers. Therefore, if businesses deem the scheme to be too shortterm, they will not invest. Hence, longer term schemes are vital to give industry the certainty and stability to invest in the materials and training required for scheme delivery. Schemes are often finalised and enacted into law only a matter of months (sometimes less) before they are due to commence. This short timeframe does not give the supply chain sufficient time to ramp up and prepare itself to deliver schemes. In the case of ECO4, delays meant that households missed out on over £32.6 million of predicted bill savings, according the ECIU.3 .The delay also had very damaging effects on the insulation industry. Therefore, the NIA would like to see more notice given between the announcement of retrofit schemes and their start date.

3. Schemes require a lot of administration. The NIA appreciates the need to ensure compliance and high-quality work. However, the administrative burden associated with certain aspects of government retrofit schemes can exclude some businesses from engaging. Many new and smaller businesses do not have the knowledge or experience to support the administrative element of the schemes. This limits the scope of delivery because there is not enough competition or volume in the market. While we recognise that some level of administration is necessary to safeguard quality standards, smaller businesses and new entrants need to be supported through the administrative process to ensure that they are not excluded. To deliver the volume of installs needed to reach net zero, the retrofit industry will have to expand massively. Therefore, it is crucial that new businesses, especially those operating according to industry best practice, are supported in their mission to deliver high-quality retrofit.

4. Availability and cost of retrofit assessment/coordination. Skills shortages are common obstacles for government retrofit schemes, particularly when it comes to finding enough highly skilled retrofit assessors and coordinators. For example, the design of the Great British Scheme Insulation (GBIS) as a single measure scheme makes it difficult for jobs to be profitable. All measures delivered under GBIS require a retrofit assessment prior to install. However, the high cost of retrofit assessments and the difficulty of finding qualified assessors means that it is often not profitable for businesses to deliver a single measure to a property. Therefore, the NIA would like to see a focus on multi-measure schemes that deliver whole house retrofit. This will result in greater energy and cost savings for residents and make jobs more profitable for participating retrofit businesses.he volume of installs needed to reach net zero, the retrofit industry will have to expand massively. Therefore, it is crucial that new businesses, especially those operating according to industry best practice, are supported in their mission to deliver high-quality retrofit.

Which standards and assessment frameworks are needed to deliver a reliable, skilled workforce capable of transitioning UK homes to modern heating solutions?

The Future Homes Standard 2025, particularly the changes to Part L and F of the Building Regulations, will provide the baseline for improvements in the sector. It will aim to ensure that new homes produce 75-80% less carbon than existing ones. Whilst the NIA supports this, attention must also be paid to the 28 million existing homes that have inadequate levels of energy efficiency. Currently, 50% of dwellings have an EPC of D or lower according to the English Housing Survey 20224 , meaning that residents have higher energy bills and are more likely to be exposed to negative health impacts of cold homes. The NIA believe that both the worst first and fabric first approach should be followed to address the need for investment in existing homes. Minimum Energy Efficiency Standards (MEES) across all housing tenures are also a key regulatory lever that will drive progress towards more energy efficient housing.

How might the Government support innovation in delivering local solutions?

Continued Professional Development and accreditation is vital to ensure that new technology used to insulate homes is safe and effective and does not result in unintended consequences. Local training programmes, qualification and apprentice schemes need to be made available to incentivise younger generations to enter the industry and upskill the existing workforce. This will address the need for a larger workforce to decarbonise housing and stimulate innovation.

However, even where innovative technologies have been proven to be safe and effective, there are still numerous barriers to their large-scale deployment. Therefore, the NIA would like to see greater government support for innovative measures. One of the most accessible routes for innovative technologies is via the “Innovation Measures” mechanism included within some government energy efficiency schemes. The NIA would encourage government to increase its support by raising the cost cap within government schemes and streamlining the process by which a new technology can be formally accepted as an Innovation Measure. The development of new solutions will be key to unlocking greater energy savings and accelerating the transition to net zero. Hence, it is vital that the industry has the support needed to foster ingenuity in the sector.

What role should customer choice play in the future planning of energy networks for home heating?

Does the current state of consumer protections for low-carbon home technologies represent a barrier to uptake of these products?

The current level of consumer protections for low-carbon home technologies varies, with those receiving installations outside of publicly funded schemes often subject to lower standards and protections. The Competition and Market Authority’s 2023 report on Consumer Protection found that while government schemes follow standards such as PAS 2035/2030 offering relatively strong consumer protections, for products installed outside of these schemes the level and robustness of the protections is lower. The report highlighted the risk that consumers can be put off from buying low carbon products as a result, particularly ‘able-to-pay’ customers who are not eligible for existing fuel poverty schemes despite a genuine need for support.

This barrier to uptake of energy efficiency products is concerning as it makes customers reluctant to invest, while increasing the potential of poor-quality installs, which damages consumer confidence further. The NIA is committed to maintaining and raising standards across the insulation industry. Therefore, we support robust consumer protections as they build trust in the sector and in emerging technologies. Uptake of low-carbon home technologies on an enormous scale is required to reach net zero in homes. For this to be achieved, consumers must have confidence in both the quality of low-carbon products and the quality of installations. It is important therefore, that these protections are clearly communicated, straight forward and readily available for the benefit of both installers and consumers alike. As installers are often the first point of contact for consumers when they learn about new technologies, it is important that installers can communicate their protections effectively. Therefore, the NIA advocates for robust protections, working in conjunction with high quality standards. This is the best way to protect consumers and ensure that residents can benefit from the financial, health and environmental benefits of high-quality retrofit.

How will the public be able to afford the switch to decarbonised heating?

The most effective way to ensure that the public can afford the switch to decarbonised heating is by following the fabric-first approach. Insulation can significantly decrease the heat demand of a property and cut heating costs. According to research by the Energy & Climate Intelligence Unit, raising the EPC of a property by one SAP band from D to C can reduce space heating demand by 20%.5 Insulation is the most effective way to make home heating affordable because it reduces energy demand and energy bills.

However, taking a fabric-first approach is especially important when it comes to the installation of low-carbon heating systems, such as heat pumps. Heat pump efficiency is dependent on the flow temperature at which it operates, running at higher efficiencies when the flow temperature is lower. However, a property can only be adequately heated at low flow temperatures if it has a high thermal efficiency. Therefore, the installation of fabric efficiency measures prior to, or alongside, heat pump installation means a smaller, cheaper heat pump can be installed which will then operate at higher efficiencies over its system lifetime. If low-carbon heating is installed and then insulation added afterwards, consumers may be left with a heating system that is not proportionate with the property’s reduced space heating demand and therefore has capital and running costs that are unnecessarily high. It is vital that properties are as insulated as much possible before installing low-carbon heating systems to ensure they are sized correctly and cost less to run.

The Government has set ambitious targets for the decarbonisation of heat including to install 600,000 heat pumps per year by 2028, rising to 1.9 million per year by 2035. The NIA support these targets but, for the transition to low-carbon heat to be achievable and cost-effective for consumers, it must be accompanied by a national insulation programme of similar scale and ambition. This will ensure homes are ‘retrofit ready’. As part of this national insulation programme, the Government must consider more policies to support and incentivise the installation of energy efficiency measures, particularly in the “able to pay” sector, for instance by supporting innovative green finance mechanisms and leveraging private investment. This support should be combined with a public information campaign to raise awareness of the financial, health and environmental benefits of insulation. Insulation will safeguard consumers from increased heating costs, thereby ensuring a just transition to low-carbon heat, especially for those vulnerable groups most at risk of falling into fuel poverty due to energy bill increases.

How will decarbonisation plans be drawn up in each area?

Do the current EPC frameworks help consumers make informed decisions on transition?

The NIA recognises that EPCs are a useful framework to facilitate energy efficiency improvements. However, the current framework was created 15 years ago when the retrofit landscape was very different.6 Therefore, we believe reform is needed to modernisation the framework and make it fit for a Net Zero context.

To this end, the Scottish Government’s recently published consultation on EPC reform is encouraging and offers some useful proposals. It proposes to introduce three separate headline metrics: a fabric rating, a cost rating, and heating system type.7 This provides consumers with a more detailed information breakdown on the performance of different aspects of their home, which will help consumers to make informed decisions about the best route to improving the energy efficiency of their homes. The NIA supports the introduction of similar reforms across the UK.

A fabric-first approach is widely accepted across government and industry as the most effective approach to retrofit. To reflect this, we would like to see fabric efficiency given more weighting within EPCs as a necessary first step towards decarbonising homes. Fabric efficiency should also be more clearly signposted on EPCs to give consumers a clear idea of their property’s current fabric performance and how this can be improved. The Scottish Government’s proposals to include fabric efficiency as one of three headline metrics on EPCs are welcome in this regard.8

An additional improvement to the EPC framework includes more regular trigger points for assessment. Currently, EPCs are valid for 10 years. However, the energy efficiency landscape is constantly changing as new policies and targets are introduced to drive the transition. The NIA support reducing the validity period of EPCs and introducing additional trigger points for EPC assessment to encourage engagement with current technology. Trigger points include:

  • Major renovations, including extensions
  • Minor renovations, including replacing windows
  • Marketing of a property
  • Applications for green finance.

This would allow a more up-to-date and greater coverage of EPC data across the housing stock. It would also provide a more accurate picture of the UK housing stock and its energy performance for policymakers, businesses, and consumers. The Government must support industry to train new energy assessors and upskill existing workers, to increase the number of skilled energy assessors. This would improve the accuracy of EPCs and thereby increase consumer confidence in the reliability of the EPC framework.

Do standards need to differ for different types of housing?

What is the role of different levels of government in developing, funding and implementing schemes?

All levels of government have a role to play in delivering energy efficiency schemes. Central government is best placed to set direction in terms of policy and scheme design. This should always be done through early dialogue with those who implement schemes, particularly local authorities and retrofit businesses.

Funding for energy efficiency schemes should also come primarily from central government, alongside some match funding from LAs. However, the private sector also has an important role to play in funding energy efficiency schemes, something has not yet been fully explored in the UK. Some international energy efficiency schemes, such as the PACE (Property Assessed Clean Energy) scheme in the US9 and the KfW loans and grants scheme for energy efficiency refurbishment in Germany10, have already been successful in attracting private investors into the retrofit sector.

By leveraging investment from the private sector, these international schemes, have been able to deliver large numbers of energy efficiency measures to households, particularly in the ‘able to pay’ sector, in a cost-effective manner. The Residential PACE scheme in the US has funded energy efficiency and renewable energy upgrades worth a combined $4.2 billion (as of 2019), while at the same time remaining revenue-neutral for local municipalities.11 In this way, private sector funding can pave the way for retrofit at scale.

When it comes to the implementation of energy efficiency schemes, this is usually most effective at a local or regional level, as most energy efficiency work is carried out by local installers; therefore, it makes sense for implementation to be devolved to local authorities and other local actors. Local authorities have a more detailed and nuanced knowledge of their local housing stock. However, there has historically been issues with a lack of resources to efficiently deliver schemes and a need for technical support to meet funding application deadlines. Without this there is a risk of delay which can have negative impacts on scheme reputations for consumers and industry. The Government need to be aware of this and provide additional support to LAs where needed.

Net Zero APPG Myth Busting Report – NIA Policy Summary

Net Zero APPG Myth Busting Report - NIA Summary

The Net Zero All Party Parliamentary Group (APPG) has published a report aimed at dispelling myths and misinformation surrounding the Net Zero transition. It highlights the need for accurate information and a shared understanding of the path towards Net Zero among policymakers, industry leaders and citizens. It emphasises the role of education, communication and behaviour change and notes the challenge of effectively communicating climate change issues – and the importance of using language that the general public can understand. Ultimately, the report aims to debunk myths, provide clarity, and drive real behaviour change to accelerate progress towards Net Zero.

The Net Zero APPG – Who are they?

The Net Zero APPG aims to accelerate the transition to a low carbon and affordable future, embed zero carbon solutions and achieve Net Zero growth and innovation, as a well as a carbon-neutral economy in the UK. The APPG promotes cross-party debate, consensus, and support to effectively address the climate change challenges. Their overarching aim is to unlock green innovation investment and incentives while driving better communication and changing the narrative surrounding Net Zero.

Why the narrative needs to change?

In the foreword of the report, Lord Deben summarises why the narrative needs to change:

  • Terms related to climate change are not well understood, such as ‘retrofit,’ ‘modelling,’ and ‘sequestration.’
  • People struggle to grasp concepts like ‘kilowatt-hour’ because it cannot be felt, touched or seen.
  • To engage people, it is more effective to discuss how climate change affects their bills and emphasisethe financial benefits of home improvements that save energy.
  • Statistics need to be translated into relatable experiences for the audience, for example understanding that just over 1°C of warming can have a significant impact on global weather patterns and can cause extremely hot weather.
  • Experts have historically prioritised scientific communication over effective public engagement – this needs to change to build public support for Net Zero.
  • Lack of understanding of climate change terminology can lead to the spread of myths.
  • The language we use to talk about climate change is crucial because it influences people’s actions.

Debunking some Net Zero Myths

In tackling the challenge of achieving Net Zero in the UK, the APPG makes clear that it is important to address the misconceptions, misinformation and myths surrounding the climate change narrative.

To accelerate behaviour change and promote informed decision making, effective communication is paramount and while it may not always be possible to completely dispel every myth, the Net Zero Myth Busting Report aims to provide policymakers with better information. The report seeks to highlight areas of consensus and identify the key areas that warrant greater debate and clarity from Government so that there is a more accurate understanding of the challenges and solutions on the road to Net Zero.

Myths highlighted in the Net zero appg myth busting report

#1 Net Zero is bad for growth and pushes up costs

#2 Getting to net zero costs

#3 We don’t have the green skills and jobs we need to scale up and get to net zero

#4 Our cities are bad for the environment

#5 Carbon capture and storage (CCS) is counterproductive and unnecessary

#6 Nuclear power isn’t a clean energy source too much money

#7 Renewable energy is too reliant on the weather, and too expensive

#8 It’s just not possible to make all homes energy efficient

#9 Tenants jump at the chance to retrofit their homes if it’s free

#10 Heat pumps are too expensive and don’t work in old properties or in cold temperatures

#11 Green hydrogen is the ‘silver bullet’ for Net Zero Homes and buildings

#12 Consumers will always choose the sustainable option

#13 It’s too expensive to electrify our railways

#14 We need more electric vehicle charging points to match demand

#15 We don’t need more road capacity to reach Net Zero

#16 All buses must be Net Zero emission if we are going to reach our decarbonisation target

#17 Hydrogen plans will deliver Net Zero aviation

#18 Jet Zero won’t happen and can’t be delivered by 2050

#19 Focusing on reaching Net Zero by 2050 is enough to tackle the climate emergency

#20 It’s too hard to decarbonise our Ports

#21 The UK will need to import plant- based alternatives to replace its meat and dairy products to reach Net Zero

#22 We just need to reduce carbon to get to Net Zero

#23 Recycling is the best way for me to do my bit for the planet

A Summary of Recommendations

After reviewing the report and examining the myths and recommendations, we have identified the key insights relevant to energy efficiency in buildings. The relevant myths, ‘myth busts’ and recommendations are shown in the table below. Please note that each response reflects the opinion of the author and not the collective view of the Net Zero APPG and its supporters.

Climate Change Committee – 2023 Progress Report to Parliament

Climate Change Committee – 2023 Progress Report to Parliament

On 28th June 2022, the Climate Change Committee published their Annual Progress Report to Parliament. The CCC have reviewed the impacts of the government’s net zero strategy and policies across all sectors and analysed its adequacy. Set out below is a summary of the report.

Energy Efficiency

Overall, the CCC declared that their confidence in the UK meeting its carbon reduction targets has decreased over the last year. The CCC’s Monitoring Framework, which measures the UK’s progress towards net zero, concluded that progress on energy efficiency measures is “significantly off track”. Progress against the CCC’s recommendations from last year has largely been insufficient. In particular, no progress was made in introducing a clear, implementation focused policy to ensure owner-occupied homes reach a minimum energy performance of EPC C by 2035.

Despite the Government detailing its ambition to decarbonise buildings in 2021’s Heat and Building Strategy, the CCC’s Progress Report notes that all major progress indicators are falling behind, with the possible exception of overall emissions reduction. In this area, there has been a 16% decrease since 2022 in emissions from homes. However, the CCC noted that this headline decrease was largely due to high energy prices and milder than usual weather. Adjusting the data to account for temperature-related factors reduces the decrease in residential emissions to just 6%. It also observed that reductions in emissions and energy use are unlikely to continue without further policy interventions.

While the CCC reiterated its support for upcoming changes to regulation, including the implementation of the Future Homes Standard, there is a sense that the current pace of decision making is not fast enough to deliver Net Zero commitments. Slow decision making is creating uncertainty right across the sector, ranging from how to deliver sufficient retrofit measures to investment decisions in skills and building supply chains.

The CCC also point to the need to give greater attention to policy gaps relating to non-residential buildings. Temperature-adjusted emissions show an increase of 5% in emissions from non-residential buildings since 2022. This is partly due to a rebound in the number of people returning to office work after the pandemic, however, there is still an urgent need for more policy certainty in this area. Currently, “There are no convincing plans to decarbonise commercial buildings”, according to the CCC.

Progress reported for specific indicators are as follows:

  • Despite an increase in funding available for social homes, actual numbers of installations have not yet increased, and installations under ECO also lag behind the CCC’s pathway expectations with each iteration of ECO delivering fewer measures, and ECO4 starting slowly.
  • The uptake of energy efficiency measures remains slow, especially in the owner-occupied and private-rented sectors, despite the energy crisis providing an increasingly clear financial incentive to retrofit properties
  • Public sector and commercial buildings also require an increase in the uptake of fabric energy efficiency improvements.

The CCC reported that 77% of building related emissions in the 6th Carbon Budget are judged to be “at significant risk, or with insufficient plans”, highlighting significant policy gaps in this sector. They judged that the greatest policy gap is in dealing with energy efficiency in non-fuel-poor homes. For each sector, a number of specific recommendations have been set out to address the evident policy gaps, which we have summarised below.

Recommendations

The CCC report classes energy efficiency improvements to existing buildings as a “no-regret” option for the decarbonisation of buildings.

As an urgent priority, the CCC has called on the Government to finally respond to the 2020 consultation on requiring that homes in the Private Rented Sector (PRS) meet an EPC C by 2028. This response was promised at the end of 2021. This substantial delay and a lack of policy certainty from Government is holding back progress in this area.

A comprehensive home energy retrofit scheme is required to provide long term funding for consumers and supply chains and support the installation of energy efficiency measures. It is also necessary to consider a whole building approach that will be effective across multiple building archetypes, including those that are traditionally difficult to retrofit, such as large blocks of flats.

Workforce and Skills

‘Workforce and skills’ is another area where the CCC rated progress as being off track for achieving Net Zero. In particular, the CCC has warned that there are insufficient plans in place in terms of the ambition and timelines required in the skills sector to facilitate Net Zero. Progress is being made in specific areas, but a lack of clear strategy means that overall change is slow and fragmented. Clearer plans are needed from government to harness the potential of the transition and manage its risks.

The sector has clear cross-cutting implications on the transition in the energy efficiency sector, so slow progress in this area poses a serious risk to meeting our net zero targets in terms of decarbonising buildings.

Moving forward, there is potential for the Net Zero transition to create more jobs than will be lost. Between 135,000 and 725,000 net new jobs could be created by 2030 in low-carbon sectors, with the majority of these expected to come in the buildings retrofit sector. However, this is contingent on having a clear green skills strategy in place.

Broadly speaking, there is expected to be increased employment in growth sectors such as the retrofit sector. Low Carbon and Renewable Energy Economy (LCREE) employment across the UK grew 16% from 207,800 in 2020 to

247,400 in 2021, representing the largest year-on-year increase recorded. Over the same period, total UK employment only grew by 6%.

There are a number of key barriers in this sector that need to be overcome to reach Net Zero:

  • Lack of clear strategy from government
  • Inadequate supply of skilled workers
  • Lack of long-term certainty around investment incentives and sector demand
  • Competition from overseas
  • No consistent UK-wide evidence is available for monitoring progress on green skills
  • Low levels of diversity in the Net Zero workforce
  • Potentially disruptive impacts for some communities (i.e. job losses)

Recommendations

The CCC made a series of recommendations on actions the Government must take to ensure that the workforce and skills is in place for us to deliver on our net zero ambitions in the retrofit sector.

Meeting or Missing the Milestones: Committee on Fuel Poverty Annual Report 2023

Policy Summary: Meeting or Missing the Milestones: Committee on Fuel Poverty Annual Report 2023

Introduction

The Committee on Fuel Poverty (CFP) has published their latest annual report today, which assesses progress towards the Government’s 2030 fuel poverty statutory target and 2025 fuel poverty interim milestone. The report also makes a series of recommendations to Government on how they can address fuel poverty in order to meet these targets.

The Government has already declared its intention to review the 2021 Fuel Poverty Strategy, which is vital if it is to meet the 2025 and 2030 targets. This report is expected to inform the Government’s review.

Below is a summary of some of the report’s key findings and recommendations.

You can also read the full report here.

The Government’s Fuel Poverty Targets

The government’s statutory fuel poverty target is to ensure that as many fuel poor homes as is reasonably practicable achieve a minimum energy efficiency rating of Band C, by 2030. The interim milestones are:

  • As many fuel poor homes as is reasonably practicable to Band E by 2020
  • As many fuel poor homes as is reasonably practicable to Band D by 2025

Wider Context

  • The last Annual Report was published in October 2021. Since then there have been a series of shocks to the UK economy which have hindered progress towards the Government’s fuel poverty targets.
  • Since 2021, soaring fuel prices have forced 287,000 more households into fuel poverty. On the other hand, energy efficiency measures have contributed to some 145,000 households being removed from fuel poverty, whilst increased incomes have lifted 48,000 out of fuel poverty. The net effect is an increase of 100,000 more households being in fuel poverty compared to 2021.
  • The Government forecasts a further rise in fuel poverty to 3.53 million this year (a rise of 270,000), and a further widening of the fuel poverty gap to an average of £443 per household, an increase of 31%.

2020 Milestone

  • The 2020 Fuel Poverty milestone has already been missed and an unacceptable number of CFP recommendations have yet to be acted upon.
  • The 2020 milestone to ensure that as many fuel poor homes as is reasonably practicable achieve a minimum energy efficiency rating of Band E has still not been met. This does not bode well for meeting the 2025 milestone.

2025 Milestone

  • The 704,000 properties in England rated E, F and G require urgent upgrading, or the second 2025 milestone will be missed.
  • According to the Government’s own assessments, published in a response of 18 January 2023 to an Environmental Information Regulations request, “Current announced policies are expected to upgrade around 140,000 E-G homes to D+ by 2025. This would result in 515,000 fuel poor households still being rated E-G in 2025.”
  • To ensure that low income households are living in homes that are at least Band D rated by 2025, the Committee has identified two things as essential: o That all such households are easily, cost-effectively, identified.
  • That energy efficiency programmes are well-targeted at those households

2030 Milestone

  • Achieving the 2030 target will involve upgrading approximately 3.26 million D-G rated households to a C rating.
  • To meet the 2030 target, the Government will have to upgrade to a C rating at least 365,000 D rated properties per year from 2023 to 2030.

Key Recommendations

  • The report makes 5 broad recommendations on how the Government can address fuel poverty in England in order to meet its fuel poverty targets. They are:

    1. Ensure a robust Fuel Poverty Strategy and effective measurement of fuel poverty that leaves no one behind.

    2. Improve targeting of payments to support bills and better targeted energy efficiency programmes to meet the government’s milestones.

    3. Improve affordability of bills through fairer pricing and better regulation to protect the fuel poor.

    4. A shared mission to tackle fuel poverty adopted by government, local government and the NHS.

    5. A fair transition to net zero that does not increase fuel poverty.

Table of Recommendations and Calls to Action

These 5 key recommendations are underpinned by 19 calls to action, which are laid out in the table below.

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Ofgem’s Administration Consultation: Great British Insulation Scheme and ECO4 Amendment

Ofgem’s Administration Consultation: Great British Insulation Scheme and ECO4 Amendment

Draft Energy Strategy and Just Transition Plan (www.gov.scot)

Closing Date: 16 June 2023

Response submitted by: National Insulation Association

For more information, please contact: info@nia-uk.org

About the National Insulation Association

The National Insulation Association (NIA) represents the insulation industry in the UK with a member base comprised of installers, system certificate holders, and manufacturers who provide a wide range of insulation solutions for homes and buildings. The NIA and its members are fully committed to maintaining and raising standards within the insulation industry.

Do you agree with our proposed approach to monitoring progress against annual phase targets? If you disagree, please provide alternative suggestions, including any evidence, to support your response?

Yes, the NIA agrees with the proposed approach for annual phase targets, which require suppliers to deliver a minimum number of measures in the first two years and reach at least 90% of the target within the relevant phase year. Ambitious targets are important to drive activity and to ensure that as many insulation measures as possible are delivered to those who need it. The minimum delivery requirement of 90% also provides clarity to suppliers on their obligations and encourages them to pursue a high level of annual delivery throughout the scheme.

The NIA agree that measures delivered on or after 30th March 2023 but before the ECO4A Order has commenced, should be classed as early delivery measures, and still contribute to annual minimum requirements and caps under the scheme, provided they are eligible measures. We recommend that the targets are reviewed on a regular basis to ensure that they are at an appropriate level, and that suppliers are adhering to them. Consequences for not achieving the targets should also be made clear.

Do you agree with our proposed approach for administrating Carry-over? If you disagree, please provide alternative suggestions, including any evidence, to support your response?

We support the proposal to allow unlimited carry-over between annual targets for the first two years of the Great British Insulation Scheme as this could accelerate the delivery of energy efficiency measures. If suppliers have the capacity to overspend on their annual targets, then this should be encouraged as much possible. The NIA are supportive of anything that results in energy efficiency measures being installed at a faster rate.

However, if suppliers have exceeded their targets in Phases A and B of the scheme and are therefore ahead of their overall targets going into Year 3, it is important that there is still an incentive for suppliers to meet their Year 3 targets. Wherever possible, suppliers should be encouraged to exceed their targets, and this includes their whole scheme targets due at the end of Year 3. This could potentially be linked to an extension of the scheme, whereby suppliers that have exceeded their targets over the course of the scheme are allowed to carry over surplus measures into any future phases.

Do you agree with our proposed approach for administrating Carry-under? If you disagree, please provide alternative suggestions, including any evidence, to support your response?

Yes, we agree that some level of carry-under is important to aid with the overall flexibility of the scheme. We believe the carry-under mechanism should be used in exceptional circumstances whereby suppliers must have a valid reason for failing to meet their annual targets.

We recognise that suppliers may experience some difficulties in meeting their Phase A targets due to the significantly delayed start to the scheme. Therefore, we would support a higher level of permitted carry-under between Years 1 and 2 of the scheme to account this delay, and any other issues that may arise during the early stages of the scheme. Under the current proposals, there is a risk that suppliers will be unable to meet their Phase A targets. This situation would not just be detrimental for suppliers, who may face penalties as a result, but it would also be negative for everyone else involved in the scheme. If Phase A targets are missed and not carried over, households will miss out on the opportunity of much-needed insulation measures to improve the thermal comfort of their homes. This will also have damaging consequences for the whole retrofit supply chain who will be prevented from accessing crucial funding to deliver insulation measures.

Therefore, we would urge the Government to allow more flexibility in the level of permitted carry-under between Years 1 and 2 of the scheme, so that suppliers, insulation businesses and consumers are not disadvantaged as a result of targets being missed due to factors out of the industry’s control. Greater flexibility is needed for these initial phases in the context of the current energy crisis and the ongoing climate crisis, as it is imperative that insulation measures are delivered to as many households as possible, as soon as possible.

Do you agree or disagree with our proposed approach to verification of appropriate Council Tax bands for the general household eligibility group? Please provide further information and evidence in relation to your response?

Our members understand the intention behind using Council Tax bands to verify the eligibility of the general group to focus funding support on those households that need it most. However, they raise concerns over relying on Council Tax bands as they are largely out of data having been first valued in 1991 and again in 2003. Though it is possible to request a review of an individual Council Tax band, our members want to raise their concerns in basing eligibility on this when the Government can’t guarantee they are up to date. This could result in unfair exclusion from GBIS funding.

Our members also highlight the potential for delays in the scheme if suppliers are to be involved in collecting evidence on the resident’s Council Tax band for eligibility purposes, as the consultation suggests. This will involve them collecting a council tax bill from residents to prove their banding level. There is a concern that residents won’t keep the annual letter they receive on their council tax and that collecting this information could cause delay in scheme compliance. Our members see this as a potential barrier to delivery.

It was suggested by some members that the use of the Government’s online Council Tax band checker could be useful in facilitating this approach if it is pursued.

Do you agree with our proposed administration of the PRS under the Great British Insulation Scheme? Please provide suggestions for alternative evidence if you disagree with our proposed approach?

We would like to see low-cost measures, like loft and cavity wall insulation (CWI) offered alongside higher-cost insulation measures, such as solid wall insulation (SWI), being offered to private rented households, and as to this degree do not agree with the proposal. According to the English Housing Survey 2021-2022, homes in the private rented sector (PRS) have lower rates of cavity wall insulation (61%) than other tenures of home (71% of owner-occupied homes and 77% of social rented homes),1 and therefore excluding loft and cavity wall insulation for PRS households would restrict the number of eligible insulation measures for this group. Being able to offer both types of measures will mean that homes receive the most suitable measure for that property. Under the current proposals, households in the PRS with uninsulated lofts and cavity walls would be excluded from support. The NIA does not agree with excluding this group of households from accessing crucial energy efficiency upgrades. According to the latest Household Energy Efficiency data from DESNZ, 29% of cavity walls and 33% of lofts in the UK were still uninsulated. Thus, there is still a sizable volume of households that require CWI and insulation to improve their energy efficiency.

The consultation states that landlords are more likely to pass on the cost of installations to their tenants, citing this as a reason not to include lower cost measures in the general group. However, the lower cost options represent a reduced financial burden for both landlords and tenants, and have the potential to deliver significant benefits for both, therefore there is no reason not to include them as eligible measures.

The NIA and our members would like to highlight that landlords in the PRS have varying abilities to invest in their properties through the scheme, as they may be charities or housing associations dealing with multiple landlords in one building. There will also be situations where landlords are not investing in their properties and local authorities are not adequately enforcing this, it is the view of our members that these tenants should not be left without support and should be eligible for GBIS funding. There is also a portion of tenants in the general group that are experiencing fuel poverty but are not classified as fuel poor under the official definition and therefore do not benefit from additional support. This includes tenants living in LSO areas, receiving mid-market rent, and relying on electric heaters for warmth, pointing to the wider issues in the PRS regarding high rates of fuel poverty and a gap in support for energy efficiency improvements2. Until the government respond to the 2019/2020 consultation on Minimum Energy Efficiency Standards, which would mandate landlord investment in their properties, tenants in the PRS need more support to improve the properties they rent.

The private rented sector experiences significantly higher rates of fuel poverty than other tenure types, with 24.1% of PRS households estimated to be in fuel poverty, according to the latest available data.3 As this data is from 2021-22, prior to the steep rise in the energy price cap, it is highly likely that there are now many more PRS households either in fuel poverty or at risk of falling into fuel poverty as a result of the ongoing energy crisis.

Consequently, the NIA believe it is crucial that loft and CWI insulation are included as options for the general eligibility group in the PRS as part of GBIS funding. This would offer an avenue through which fuel poor households can access additional support to cut their energy bills and improve their thermal comfort. Since the PRS suffers from the lowest rates of energy efficiency and highest rates of fuel poverty, it is vital that households in the sector are eligible for all available measures, including loft and cavity wall insulation.

Are there any additional issues you wish to raise regarding interactions between ECO4 and the Great British Insulation Scheme and/or with other existing grant schemes?

The NIA has concerns about the current proposals for the Great British Insulation Scheme and their implications for the scheme’s interaction with the Home Upgrade Grant (HUG).

The scheme includes a 20% uplift for rural off-gas properties. However, under the current proposals, this uplift will apply to Scotland and Wales only, not England. The reason given for excluding England from the uplift is because of the ‘overlap in rural areas with the HUG 2 scheme’.4 However, the markedly different eligibility criteria between HUG 2 and GBIS means that, in practice, the overlap between the two schemes will be limited. While HUG 2 is targeted at low-income households, up to 80% of households targeted by the GBIS are set to come from the general eligibility group, not the low-income group. Therefore, a substantial majority of GBIS households will fall outside of the HUG 2 support framework. A 20% uplift is needed for these properties that cannot access HUG 2 funding because of the scheme’s low-income eligibility criteria.

With the current proposals to only apply an uplift to properties in Scotland and Wales, it is likely that installers may target households in Scotland and Wales at the expense of properties in England. This could result in rural off gas properties in England missing out on essential energy efficiency upgrades. This risks creating geographical inequality in energy efficiency and fuel poverty rates between different nations of the UK.

The NIA suggests that the uplift is extended to apply to England, Scotland and Wales rather than not being provided at all. If the Government does not include a 20% uplift, it risks unfairly penalising rural, off grid homes in the general eligibility group. As well as being more remote, these properties are often hard to treat, meaning installers generally face higher installation costs. If there is no uplift to account for these increased costs, then it might not be viable for installers to deliver insulation measures to rural off gas properties, therefore these homes could miss out on much-needed energy efficiency upgrades. The Government’s annual fuel poverty statistics show that off gas properties suffer from much lower energy efficiency and much higher rates of fuel poverty than on gas properties. Only one-third of off gas properties are EPC band A-C and 20.1% are fuel poor.5 By not applying an uplift to off-gas properties in England, this policy risks excluding some of the most vulnerable people and the least energy efficiency properties from support. Therefore, it is critical that the scheme includes a 20% rural uplift to help cover the additional costs of dealing with rural off gas properties.

Do you agree with our proposal to only have one notification type – measures – instead of having projects and measures separate as in ECO4? If not, please expand on why?

With the scheme in its current proposed format – as a scheme delivering primarily single insulation measures – it is reasonable to only have one notification template for measures. Having separate templates for measures and projects is not necessary for a single measure scheme and would add unnecessary administrative complexity.

However, we would reiterate that we do not agree with the proposals to limit households to single insulation measures. We understand why the limit of a single insulation measure applies to low-income households eligible for ECO4 funding, as they can receive a deeper, multi-measure retrofit through the ECO4 scheme. However, for the general eligibility group that cannot access multi-measure funding in other schemes, this encourages a piecemeal approach to retrofitting, which isnot as effective as a multi-measure whole house approach. This is widely recognised as best practice across industry and within the PAS 2035/2030 framework. Insulation measures are far more effective at reducing bills and carbon emissions when installed as part of the same whole house package, rather than individually. For instance, in a draughty property, the energy efficiency benefits of installing cavity wall insulation (CWI) are limited if there is no draught proofing to accompany it because the property will still lose high levels of heat through the doors and windows. Hence, the NIA would like to see a package of multiple measures offered under the scheme, as in many cases, different measures can interact to significantly improve a property’s energy efficiency.

We would urge the Government to consider committing more funding to the GBIS to enable homes to receive a deeper, multi-measure retrofit. As a result of recent price increases, many households, even in the general eligibility group, are struggling to afford high energy costs. Annual fuel poverty statistics in England for 2023 show that the number of households that spend over 10% of their income on energy costs is projected to double in 2023 to 8.83 million households.6 This suggests that there is a need to extend the support offered for households to install energy efficiency measures to prevent further people falling into fuel poverty.

Moreover, investment in home insulation has long-lasting financial benefits not just for consumers, but for government as well. Research by the Energy and Climate Intelligence Unit has shown that, had the Government maintained its support for home insulation instead of cutting it in 2013, it could have saved £18 billion spent on subsidising energy bills over the course of the Energy Price Guarantee.7 In this way, more government investment in insulation in the short-term delivers excellent value for money for the taxpayer in the long-term, as well as safeguarding against the economic and social impacts of future energy price spikes. Therefore, we would like to see the Government provide more funding for the GBIS to facilitate a multi-measure, whole-house retrofit that will see individual households benefit from a much greater reduction in their energy costs.

If the Government decides not to increase the current level of funding for the scheme, then we recognise that some properties will be restricted to single measures due to the limited amount of funding available per household. However, in certain situations, it will still be possible to deliver multiple low-cost measures within the scheme’s current funding constraints. For example, in the case of an easy-to-treat cavity wall property with an uninsulated loft and draughty windows, we believe it should be possible to combine CWI, loft insulation and potentially draught proofing. These are all low-cost measures, and a package that combined them all would still be significantly cheaper than installing a single higher-cost measure. Therefore, we do not agree with only offering single insulation measures in situations where multiple low-cost measures could still be delivered at a low combined cost.

Do you agree with our proposals for the administration of caps? If not, please expand on why?

The NIA does not agree with imposing a cap on innovation measures, as it is important to encourage innovation within the industry, which can drive improved outcomes for businesses and consumers. If the retrofit sector is to meet its deliver on its ambitious net zero targets, then it must continue to evolve and grow. Innovation is key to this.

There are many households that still require insultation as discussed in our response to Question 5 but retrofit businesses can face various barriers when trying to introduce innovative new materials and installation techniques. For our members and other innovators in the sector, innovation measures, via schemes such as GBIS and ECO4, offer a vital route by which they can bring exciting new products to market. If an innovation measure is shown to deliver improved outcomes compared to its standard counterparts, then there should be no cap on the percentage of a supplier’s obligation it can make up.

Innovation is vital to the future growth of the retrofit sector and for addressing the needs of many households in accessing this work; therefore, it is vital that the Government fosters innovation and ingenuity within the industry.

Do you agree with our approach to publish new forms for accessing the Great British Insulation Scheme, to collect eligibility information and measure information? If
you disagree, please provide further comment in your response, and suggest any alternatives?

The NIA agree with this. Our members call for Ofgem to reduce complexity in the scheme and therefore minimise delay by keeping forms similar to those used for ECO. They also point out the importance of allowing the submission of tenures and completed instalments of eligible measures in bulk so that where they are fitting instalments into a high rise block of flats suppliers can submit compliance in bulk rather than individually.

Are there any areas where you think further guidance would be useful?

Our members bring up the need for more specific guidance on work carried out on blocks of flats as currently individual leaseholders must all agree to have it carried out. Often, leaseholders live abroad and rent out their properties making it more difficult to consult with them. A suggestion from our members is the use of a Property Management Company or Committee that could facilitate this rather than relying on individual leaseholders.

Do you have any further comments on our proposed administration for the Great British Insulation Scheme?

We believe that draught proofing is missing from the list of eligible insulation measures.

The effectiveness of other insulation and energy efficiency measures is drastically reduced if a property does not have adequate draught proofing. The primary aim of the ECO+ scheme is to save a large number of households money on their energy bills through the installation of insulation measures. However, there is little point in cavity wall and loft insulation if all the property’s heat escapes through draughty windows and doors. Draught proofing is often the first area of concern for many of the vulnerable households our members engage with on the ground.

For a significant number of UK properties, building regulations mean they are not able to benefit from many energy efficiency improvements. This is particularly true for leasehold flats and listed homes. For many of these properties, draught proofing is one of the only options available to them if they want to lower their energy bills and make their home warmer.

Therefore, we would like to see draught proofing included as a low-cost, high impact measure that can be installed alongside other low-cost measures, as without adequate draught proofing, the financial and environmental benefits of these other measures is greatly reduced.

NIA forms new National Home Decarbonisation Group to drive quality retrofit at scale

Hello and Welcome

Welcome to your regular NIA update.

Read on to find out about some exciting new developments, including the successful formation of our new National Home Decarbonisation Group for Tier 1 Contractor firms. You can also hear about some popular upcoming events that the NIA will present at and find out how you can join and engage at our next Insulation Intelligence Group call. You can also discover how you are being represented via consultation responses which you are encouraged to input. Finally, take a look at some interesting recent policy developments in the sector.

Enjoy the update!

Topics

  • The new National Home Decarbonisation Group
  • The NIA presents at the Installer Show and Housing 2023
  • The Great British Insulation Scheme consultation response – have your say!
  • Our recent consultation responses
  • Get involved: Insulation Intelligence Engagement Calls
  • Supporting consumers through the retrofit journey – CMA report
  • New funding awarded – Green Home Finance Accelerator

The new National Home Decarbonisation Group

You may have seen our recent announcement on the formation of a new group within the NIA known as the National Home Decarbonisation Group (NHDG). This is an extremely exciting initiative and brings together Tier 1 contractors specialising in the delivery of large-scale residential retrofit.

Tier 1 contractors (including some of our existing members) are getting serious about scaling up retrofit delivery under schemes such as SHDF and HUG in the rapidly growing decarbonisation of homes sector. It was felt that a forum was required to discuss key issues and provide an influential voice to government for these companies. As there currently isn’t one in existence, the NIA Board agreed to incorporate a group into our associations’ structure. Together, by representing firms operating at every level within the supply chain we can now offer much more influential representation for the industry as a whole under one roof.

By working closely with the Department for Energy Security and Net Zero (DESNZ) and the devolved governments, this group will push for progress growing the retrofit supply chain and championing innovation – two issues where resource, scale and collaboration can make a real difference.

Though the group is in its’ initial stages of mobilisation, we look forward to hearing more from the new NHDG membership in the coming weeks. To find out more on the NHDG please visit the NHDG website here.

The NIA presents at the Installer Show and Housing 2023

We are delighted to announce that NIA has been invited to speak at the Installer Show in Birmingham on the 28th of June. This is an extremely popular event that attracts 15,000 visitors, including many experts from across the retrofit sector so it’s a great chance to showcase the important work the NIA is doing on your behalf. It will also provide us with a fantastic platform so that we can keep putting across our key messages about the importance of high-quality, whole house retrofit in tackling the energy health, climate, and cost of living crises.

Members of the NIA team will also be attending Housing 2023 in Manchester on the same day (28th June). If you are also going to be there, please let us know (info@nia-uk.org) as the Secretariat team would be delighted to meet you.

Great British Insulation Scheme Consultation – Have your say!

You are invited to provide your comments on the response that we have drafted on your behalf to Ofgem’s consultation on the administration of the Great British Insulation Scheme. Please see our draft response attached to this email.

Valuable input from members to the initial ECO+ consultation has helped us to influence key aspects of the scheme proposals. Therefore, you’re encouraged to provide any comments so we can feed your views back to government once again. This is vital so we can advocate for a final scheme design that is best suited to the needs of the industry.

We have produced a helpful summary of the proposed scheme, which you can read here. You can also find the full consultation document here.

Please email your comments to info@nia-uk.org by Thursday 15th June before the final submission deadline on Friday 16th June.

Our recent consultation responses

It’s been a busy time for the policy team with a number of important consultations to respond to in recent weeks. These are:

BSI’s Call for Evidence on revisions to PAS 2035/2030 – We supported the overall aims of the changes to the PAS in terms of reducing complexity and administrative burdens on insulation businesses, so long as this does not compromise the quality of retrofit work.

Scotland’s Draft Energy Strategy and Just Transition Plan – We advised that supporting the energy efficiency industry would see an increase in green jobs in a sector that forms a crucial part of reaching net zero and that, in order to achieve this, there is a real need for investment in retrofit skills.

You are represented in the NIA’s consultation responses, so it is important that your voice is heard, we encourage you to provide your thoughts on the GBIS consultation along with future consultations as they arise.

Please email info@nia-uk.org

Get involved: Insulation Intelligence Engagement Calls

Thank you to everyone who attended our most recent Insulation Intelligence Group engagement call with David Pierpoint from the Retrofit Academy. It was great to hear from David about the current state of the skills landscape within the industry and the exciting training opportunities available to you.

We will be contacting you all shortly with updates on details for our next call, look forward to seeing you there!

Supporting consumers through the retrofit journey – CMA Report

The Competition and Markets Authority (CMA) has published its Consumer protection in the green heating and Insulation sector report. The report is based on findings from its Call for Information which we responded to on your behalf.

The report recognises that many consumers have a positive experience when buying green heating or insulation products. However, it also raised some concerns about how the sector can improve its offering to customers

including where customers can access relevant information, levels of transparency over costs and protections for consumers on quality assurance.

The report noted that, without action to address these concerns, there is a significant risk that people either are put off from installing insulation products or end up making poor decisions if they do go ahead. In the report, the CMA has set out a series of key actions it will be taking to address the issues raised including a guide for consumers on their rights and protections, a guide to businesses on their legal responsibilities and a set of good practice principles for standards bodies and quality assurance schemes.

New funding awarded – Green Home Finance Accelerator

As part of the government’s Net Zero Innovation Portfolio (NZIP) the Green Home Finance Accelerator (GHFA) will receive £20 million in funding to support homes in the owner-occupied and private rented sectors to reach the target of an EPC C by 2035.

The GHFA has just been awarded an initial £4,169,227.42 in grant funding to cover 26 projects across the UK. These projects will support the development of green finance products with the aim of increasing uptake of home energy efficiency improvements, low carbon heating measures and micro-generation.

The project is now in its Discovery Phase meaning that the 26 projects have been identified and will be able to apply to the 15-month Pilot Phase in October 2023. A list of the projects can be found here.

The GHFA offers an opportunity for NIA members to engage in partnerships with the above projects, which include representatives from the housing sector, private lenders and investors as well as representatives from the energy efficiency sector and low carbon heating. We encourage you all to get involved!

For more information on the GHFA please visit the website here.

Join our policy mailing list

NIA members are vital to help shape our consultation responses. If you would like to receive draft consultations for you to provide your input, please email info@NIA-uk.org

NIA forms new National Home Decarbonisation Group to drive quality retrofit at scale

NIA forms new National Home Decarbonisation Group to drive quality retrofit at scale

We are delighted to announce the formation of a new membership organisation, the National Home Decarbonisation Group (NHDG), with a core mission to collectively deliver high-quality energy efficiency measures and low carbon technologies at scale across the UK’s housing stock.

The group aims to bring together the major stakeholders from across the retrofit supply chain, so it can provide one coherent voice on the key challenges and opportunities facing the sector going forward. Backed by the country’s leading contractors and residential retrofit specialists and with widescale delivery in mind, the NHDG predicts that in the coming years its members will be at the forefront of large-scale domestic retrofit work in the UK.

With a membership basis comprising of Tier 1 contractors and energy suppliers specialising in retrofit residential decarbonisation at scale, the group will support retrofit installations for all housing tenure types, including social, owner-occupied and private rental homes.

The NHDG will focus on three core areas critical to achieving the government’s ambitious decarbonisation targets for the sector:

1. Growing the retrofit supply chain
2. Advising on policy
3. Stimulating innovation

By focusing on these core areas, the NHDG will support households during the ongoing energy, cost of living, health, and climate crises. The Department for Energy Security and Net Zero (DESNZ), as well as devolved governments and key sector stakeholders, supports the group’s focus on these three core streams.

The NHDG has been founded through the NIA and will build on our existing strengths as a trade association. Our members have a strong track record of delivering large-scale, PAS:2035 compliant installations funded by various government schemes – such as the Social Housing Decarbonisation Fund (SHDF) and Home Upgrade Grant (HUG). Member experience is also vast in the area of home energy efficiency improvements available to the private rental and owner-occupier market, under schemes such as the Energy Company Obligation (ECO). The unrivalled expertise of our members in the energy efficiency space and our strong working relationship with Government makes us ideally placed to facilitate the work of the NHDG.

Our Chairman, Derek Horrocks, will also be chairing the new National Home Decarbonisation Group. He said: “The formation of the group and the commitment already seen from founding members is a defining moment for the residential decarbonisation retrofit industry.

“The industry has seen commitment to retrofit projects diluted or under-delivered in the past and we believe that central and devolved governments need to hear a strong, positive message from experienced industry contractors and stakeholders, confidently confirming the ability of the supply chain to deliver on current and ambitious future targets.

“The continued long-term government commitment for the decarbonisation of 26 million UK homes to meet net zero targets by 2050 is critical, and we have already seen this ramp up significantly with £6.6 billion of Government investment over the current parliament and a further £6 billion pledged between 2025 and 2028 for the sector. As an industry we must ensure we are able to grow and facilitate the long-term far-reaching ambition to achieve net zero.

“NHDG will be spearheading the charge for improvements, especially in skills and innovation, including the digitalisation of retrofit, increased off-site solutions, and the development of finance solutions to support the decarbonisation of the UK’s housing stock.

“This will help create a strong, more efficient industry with robust solutions for the fast-growing demand in the sector. Our links across government and industry are already robust, and the creation of the group will ensure our combined membership will put us in a prime position to move forward as one voice on one mission.”

“We’re aware of our own targets, such as the need for 200,000 more competent retrofitters by 2030, which is why powerful collaboration is needed to create the necessary infrastructure. We’re ready to invest and increase our wider resources collectively to ensure scaling the industry is a success.”

“The stature of our founding members cannot be ignored, and we’re all excited about embracing what the future holds.”

Members of the NIA that already meet the NHDG’s membership criteria will automatically be eligible to join the new group.

The full list of NHDG founding members includes:

  • Baxter Kelly
  • Bell Group
  • British Gas Services
  • E.ON Energy Solutions
  • Equans Regeneration
  • Evolve Home Energy Solutions
  • InstaGroup
  • Mace Group
  • Mears Group
  • Osborne Carbon Neutral Solutions
  • OVO Energy Solutions
  • PHS Home Solutions
  • Saving Energy Ltd
  • SERS Energy Solutions Group
  • Sustainable Building Services (UK) Ltd
  • United Living
  • VINCI Construction

Expert professional services consultancy Gemserv will act as the group’s secretariat.

To learn more about the NHDG, please visit the website at: https://www.nhdg.org/

For media enquiries, please contact Dominic Smith, Matthew Santos or Katie Nelson at Cartwright Communications via nhdg@cartwrightcommunications.co.uk or on 0115 853 2110.

For all other enquiries, please email us at info@nia-uk.org or give us a call on 0121 718 4558

Join our policy mailing list

NIA members are vital to help shape our consultation responses. If you would like to receive draft consultations for you to provide your input, please email info@NIA-uk.org