Last year MCFly interviewed Michael O’Doherty, the lead officer for buildings and climate change, and Assistant Director of the Greater Manchester Environment Team. That experience clearly wasn’t unpleasant enough for him, since he’s gone under the cosh again.
The tl;dr is that policy uncertainty at the national level hasn’t helped, and some things have are more-or-less on track, others behind.
Here’s the interview (tidied up slightly).
Shall we get the good news out the way first – you can tell us every wonderful thing that is happening, and then we can spend the next half hour going into the fine print. So, since we last met, in July, what would be the one, two, three things that have been accomplished and that you can point to and say “we’re on the right track”.
Okay, what we have done, which we said we would do, is procured a framework of partners to deliver Green Deal Eco, and ultimately to drive the housing retrofit approach for Greater Manchester. That procurement process took – as we expected – some time, so they were announced in January, and they are Wates with British Gas, Keepmoat with EDF and Wilmott Dixon. We are finalising the contract side of things and on the first of April that scheme should be going live and we should be starting to undertake Green Deal assessments and deliver energy efficiency measures. Another positive to come out of the process – is that we will capture social benefit for Greater Manchester. It’s all about how can Greater Manchester drive a housing retrofit programme in Greater Manchester, but equally how can we ensure that Greater Manchester gets competitive economic advantage from that. How can our Green Deal provider partners, who by definition are large organisations who tend to work on a national basis, how can they engage with the supply chain of Greater Manchester, ensuring that we capture GM jobs, and that GM businesses including SMEs, benefit from the programme. How can we ensure we are capturing that local pound, so not only that savings made by households are spent in the local economy, but also wages paid to local people are spent back into the Greater Manchester economy?
Since announcing the partners we have held three very positive supply chain events. Our new partners have worked collaboratively, demonstrating that they can work together to engage with local companies. Local companies now have a route, to become part of the supply chain. The challenge will be a) transparency of that process, because we’ve been criticised before for not being as transparent as possible and b) to create the amount of work needed to develop the supply chain. That’s a big challenge of course.
So, in terms of where we said we’d be for Green Deal and Eco, we have a framework, we have the willingness to deliver, we’ve got the engagement of the 10 local authorities, the strategic context in place, we’ve got a fuel poverty plan, we’ve got a Greater Manchester Housing Retrofit Strategy, which basically sets out the longer term priorities for the programme, what we need to do to hit our Climate Change Strategy targets.
And does that have SMART goals…?
It has high-level goals… That document was always a high-level strategy which says “we need to do the following to our housing stock if we are going to contribute towards GM climate change targets. So there are long-term targets in there, which clearly can’t be SMART if you’re talking about 2030-35, about getting stock to a certain level, but there are shorter-term targets that relate back to the contract.
So for example 60,000 retrofitted homes over three to five years is a commitment within the programme. Recent changes to national policy have created further uncertainty into the numbers that we can deliver because of the amount and level of ECO funding available to kick-start the market. However we’ve got the framework and the strategic background in place.
Thanks. I want to pick up on the word “transparency” and I want to come back to this question of SMART goals. There’s a high-level document. Is there therefore going to be an implementation plan for the years 2014-17 or 2015-18 with more specific goals and named individuals/organisations and metrics. If not/why not. And what other forms of transparency besides SMART goals, implementation plans and regular reporting do you think Greater Manchester could and should undertake?
Okay, so yes there is a Low Carbon Hub business plan, of which there is a low carbon buildings plan , of which domestic retrofit is an important part of that. That is a document which is in the public domain. That contains and will contain specific targets in relation to what we are aspiring to deliver through the housing retrofit programme. We’re also reporting back through the Low Carbon Hub the outcome of that. So there is a transparent scrutiny process. We’ve also got the potential for local authorities to scrutinise our activity.
Through the scrutiny pools?
Through the scrutiny process.
Okay, any other ways that the Low Carbon Hub is thinking about this – and I understand it is difficult for you to be able to answer, because you’re not on the Board – are there any other mechanisms by which you would be reporting and publicising where you are up to versus where you said you would be up to?
We have a whole governance structure that sits under the Low Carbon Hub. Ultimately it’s reported to the Low Carbon Hub but we also have to go back to the local authorities at the GMCA level to report back on the progress we’re making on framework targets. So that would be in the public domain as well.
Is this the 60,000 houses that you’re talking about?
We’ll come back to the Low Carbon Hub and communications, because in the report that was tabled last Friday that you’re listed as the author on there’s something to pick up on.
We’ve talked a lot about domestic retrofit. I’ve got a question here; “what’s happened to stream two – the work package dealing with the retrofit of non-domestic properties. Is that still in the stage of compiling a list, or is that moved on to being a bit more fleshed out?
We have a draft business case with four authorities for retrofit of public buildings. We are proposing to take a significant programme of buildings through a procurement process; well over a hundred buildings as part of a demonstrator of aggregated energy efficiency savings. We’re looking to potentially use the London-based “refit” framework in the first instance because it has already been procured and is available. But that experience will help GM to set up its own procurement approach to public buildings retrofit. So we have made progress, we’ve got a business case in place now that is currently with four of the local authorities for signing off.
Are you able to say which those four local authorities are?
Bury, Manchester, Oldham and Trafford are looking at the business cases.
And the other six local authorities are not yet looking at them?
It was always the case that we would have a demonstrator, and this is to develop proof of concept that we can overcome the barriers to scaling up energy efficiency prorgammes. Clearly each local authority could take action in their own right, and have been doing, but this is an attempt to use economies of scale to be able to go into deeper energy-saving measures than maybe would have been possible through a single local authority approach.
Assuming that we are still talking in a year’s time, and I do another interview, and I say “what’s happened on non-domestic retrofit?” what do you hope to be able to say?
I’d be disappointed if we hadn’t been out to procurement, and selected a partner, and the partner potentially on-site at that stage for four of the local authorities.
The GM retrofit strategy that started life in 2011 in various discussion drafts – where are we up to with that – when will the final final version be published?
It will go to GMCA probably in April now. It’s been back to the Low Carbon Hub. We always said it was a draft, a publicly available draft that’s been on the website for the last year and a half, but we needed the finalised framework to understand how we’re going to deliver it, what the funding route would be, whether we were going to use Green Deal, Green Deal Finance Company, looking at other options to fund that as well.
Which segues neatly into a question here – which is pretty similar to a question I asked last year – “is there a plan b if Green Deal is doomed and is cancelled before or at the next election. Is there a contingency plan that AGMA is working on or has worked on?
So what the strategy sets out is what we’ve got to do. It also sets out how we think we’re going to do it based on current government policy. We’ve not procured a framework just to deliver Green Deal and ECO, we’ve procured a framework to deliver housing retrofit – that’s important. So we wouldn’t necessarily have to start again if there were a change in government policy. We’re sufficiently close to each of the parties’ thinkings in terms of the future to be able to recognise that there will be a model that requires some form of additional subsidy, whether it’s energy company obligation or it’s tax funded, and it’s likely that a pay-as-you-save model will still be around, but with tweaking we’d expect from each of the parties. So plan a is that we use the current government policy and drive the programme forward, plan B is that local authorities – and this is part of the strategic approach that we are taking – recognise that funding needs to come from other places if not from the Green Deal funding initiative.
AGMA has huge investment and borrowing power – I s the GM Pension Fund actively involved in looking at this?
There have been discussions with the Pension Fund, and with a number of potential sources. The first option – plan A – is to use the model that’s already in place. The issue being that Green Deal finance allows you to attach the loan to the meter. Legislation is in place to do that, so it actually makes it more complicated to bring in other finance.
So it’s right that we do give the current framework every encouragement. We accept that there are challenges that need to be overcome, one of them being that the level of interest could be deemed to be unattractive.
So, again, time-scales and metrics for this time next year – 2016, 2017. Is there a document that I can look at that tells me “well, by this time we expect to have this in place, that in place…”
There are targets set out for the framework, and that is how you breakdown your sixty thousand retrofits for that period. The caveat, as everyone knows right now, is that the Autumn Statement has affected proposals. So for example, each of the Big Six is at the moment reviewing their ECO policy in line with the Autumn Statement. Clearly that makes it very difficult to be able to commit to figures right now, however we’ve got strategic partners with the energy companies as part of our new partnership who are looking to commit resources to Greater Manchester as part of their longer term approach. So we think having a framework of more than one partner, and having energy companies tied into that framework is the best way of maximising income into Greater Manchester. It’s just difficult to predict the outcome of the Autumn Statement.
For people who aren’t familiar with the Autumn Statement and the implications it had – it seemed to create a lot of dismay and confusion, and the dust hasn’t settled – could you just briefly outline what it was in the Autumn Statement that was unwelcome or unexpected. And secondly, when do you think the dust will have settled and we will have a better understanding of where things are at, because it says here in the report “final legislation is likely to be in force by autumn”.
Obviously speaking as an officer I can only give a high level policy response to this. But for Greater Manchester, as our housing retrofit strategy set out we have a large number of hard-to-treat pre-1919 homes, and therefore we’ve got a large number of properties that would benefit from the low carbon [CERO] element of ECO. That’s the element that is probably in the long-term most affected by the Autumn Statement, because they stretched the target that was originally to 2015 to 2017, so it means there’s less onus on the energy companies to funding these works – particularly solid-wall and hard-to-treat cavities. So that’s a challenge for us, and one of the things we need to work on with our partners is how to make sure we can overcome any funding shortfall, and design neighbourhood schemes that help us to do that.
Of other aspects of the Autumn Statement, personally I think a huge concern right now is the fuel poverty element – the “HHCRO” element which supports the most vulnerable households. This is the bit that would fund 100% of measures for vulnerable households, and effectively was what replaced the previous government’s “Warmfront” scheme. The implication being that for the first time in over 20 years there’s no safety net for the most vulnerable households if their heating system fails. And because of the Autumn Statement – and probably even before, to be honest – not all vulnerable houses are able to get those measures funded 100%. So that’s quite different from Warmfront. And that’s more of an issue right now, so as I understand it many energy companies have completed or near to completed their obligation of the current period for HHCRO. And therefore the value of that ECO funding is so low that it makes it much more difficult for providers to provide those measures for free. So clearly there’s a public policy issue there . From a public policy perspective it means there might be vulnerable households that don’t have access to heating that works. It also means that we need to look in terms of how the public sector can work with partners to make sure that we can get schemes to work; whether there are funds that can fill the gap or top up measures. But ultimately, that to me is a national public policy issue.
On a more positive note, the CISCO funding – the community-based funding is now widened to include the 25% lowest IMD areas, the most deprived areas, which for Greater Manchester means more areas are able to get a broader range of measures including loft and cavity insulation, hard to treat cavity insulation. So it does help to get neighbourhood schemes working. So that’s a more positive outcome from that.
And finally, the Autumn Statement also brought in additional money through cash back to support Green Deal schemes. It talked about driving programmes for the private rented sector and it also extended the amount of nationally available funding to kick-start the ‘Green Deal communities’ scheme from twenty to eighty million pounds.
So there are some positive outcomes, but the statement has made longer term planning of the programme more challenging.
In item 9 for the meeting last week you covered that in the fuel poverty section, about these houses not getting the coverage. Still in that report, 3.1 – “marketing.” “There have been a number of stalled attempts to engage/procure GM and ECO marketing and communications agency support.” I don’t need names and addresses of anyone with responsibility, but what’s gonna happen next? If previous attempts have stalled, what’s to say that future attempts will be any better?
Public procurement relies on us being able to demonstrate that we’ve achieved best value. We’ve used a number of frameworks to try and procure a wider joined-up marketing and campaigns provider. For various reasons the outcome was deemed to not provide value for money, so we’ve had to follow a different approach. We are now working with our new delivery partners who have been able to share their knowledge through market research and we’ve broken down marketing activity into more manageable packages. So for example a branding piece, a website development piece and ongoing support lead generation. So it’s not ideal – we’d have liked to have done more already. Ironically, the timing of it probably works quite well because we have a better understanding of how ECO will operate and we can incorporate knowledge from our new partners have got as well.
Is this going to be a new website or a re-jig of an existing one? And if it’s a new one, what will the web address be?
So, we don’t know what the web address will be yet, but the question is “does the Greater Manchester Toasty” brand do what it needs to do for the wider group of customers that we are now approaching – the able-to-pay group, communities, vulnerable households.. is it a fresh enough brand? That’s the question. And it’s right that we bring in some expertise to help us to understand that. In terms of website, exploring how Greater Manchester is developing its own approach to customer engagement through web delivery, but clearly for the model that Greater Manchester has selected, having a framework of three partners, using the Greater Manchester Energy Advice Service, which you’ll recall was retained from when the EST [Energy Saving Trust] contracts ended a year or two ago now – that’s all driven by marketing, getting the message out to consumers, trying to use the trusted brand of Greater Manchester local authorities. So it’s really important that we get the right message in what is a difficult market to start off with. So marketing’s crucial.
And when will that little Toasty icon know whether he’s toast or not? Sorry, I couldn’t help myself.
You couldn’t, could you? We would like to be getting the brand in place in the next two to three months.
A draft GM Fuel Poverty plan has been produced. When is does it stop being a draft and when does it get rubber-stamped?
Again, we’re looking to take a number of documents – Green Deal Update, Housing Retrofit Strategy and Fuel Poverty Plan – which has been subject to quite a significant engagement with the right agencies – Health, Housing, Sustainability – that will go to the wider leadership team of Greater Manchester in the next four to six weeks.
And then it will be signed off at a GMCA meeting?
Sometimes there’s more work to be done after it’s gone to wider leadership team, but it’s in that chain of what needs to be done to ensure organisations have high level engagement and buy-in and therefore play their part.
And a member of the public who wanted to go along to the meeting at which that was discussed, that would be the last Friday of the month or whenever it is. And beyond a press release, what publicising of the Fuel Poverty will be done, or will it be done just with the stakeholders who were involved in the consultation?
It’s a good question. It’s not purely down to me. This whole piece of work was at a strategic level to bring together the right agencies, including various health agencies as well. Fuel Poverty is an unusual issue because it’s poverty but with particular solutions that can be pulled together if agencies work in the right way. So first and foremost we’re working on that engagement, that buy-in from senior leaders in Greater Manchester and actually changing the way we work, turning that into a positive news story – something that we should and will do I’m sure. I can’t say when that will be.
The Draft Low Carbon Housing Retrofit Strategy. “The strategy has been prepared over the last twelve months and sets out how Greater Manchester’s target for 55% carbon reduction in housing by 2022.” Now either it’s a typo for 2020 or the Housing Strategy strategy is different from the GM Climate Strategy target, which is 2020. Is it a typo or is there a gap between the two plans? I don’t have a life, I know, I can see it in your eyes.
We did actually intend to put 2022 in there. It relates to Committee on Climate Change carbon budget recommendations – although others would be better at explaining how.
That is going to be presented in April, potentially?
Yes, that’s the plan.
As I asked at the end of the last interview – anything else you’d like to say. Any questions you were afraid I was going to ask, please answer those.
What I’d say is that the last twelve months we haven’t delivered as much as we’d like to under the interim ECO scheme. The shift from a well-established loft and cavity-wall insulation market to more expensive, more disruptive and more unusual energy efficiency measures – is as we suspected a challenging one. So we’ve got to work that much harder now to use ECO funding, Green Deal cash-back funding, funds from government such as the communities funding – but also Green Deal and other finance routes to try and drive that. Have we made as much progress as I would have liked over the last twelve months? No. So certainly next time, I think it’s right that you are challenging us on how well we’ve started to up those numbers. Because ultimately this is a numbers game. We’ve got to get homes retrofitted, we have to kick-start the market, that’s the reason for doing this. Yes, government policy changes and sometimes that can make it difficult, but ultimately Greater Manchester has to demonstrate how it is helping to drive the market.