Grasping the Green Deal for Non-Domestic
Green Deal is an exciting prospect, particularly for non-domestic stock. Without any requirement for payment of upfront costs, owners of these properties are able to borrow to install energy efficiency measures and have that investment paid for via the reduction in their energy bills that the measures produce.
One of the key elements in stimulating a low carbon non-domestic market in the UK is the introduction of energy efficiency improvements such as high efficiency windows, lighting, temperature control and more efficient boilers in millions of commercial buildings in the public and private sectors. Energy efficiency improvements will stimulate a huge potential for new jobs and drive public awareness of the Green Deal as a major growth opportunity. Non-Domestic Green Deal is one of those major growth opportunities and therefore is big for business. It has the dynamic potential to deliver long-term economic growth, sustainable job creation and low carbon innovation to the UK economy for the next 20 years. Ernst and Young recently estimated that a 10% uptake from this market would equate to an annualmarket size of some £800m in 2020 and £560m per annum by 2016. It makes sense to grasp these opportunities and maximise a unique growth opportunity.
Also driving the Green Deal is the need for emission reductions of 70% - 80% by 2050 in non-domestic buildings. A total 1.8 million non-domestic buildings are responsible for 18% of total CO2 emissions, with 41% of non-domestic buildings having an energy rating of either F or G. In addition, it will be illegal to sell or let any property with an energy rating greater than E from 2018. UK businesses will therefore need to reduce their carbon footprint by better managing energy and heat loss and install measures including cavity wall insulation, double glazing, solar PV, and improved heating systems which are now available under the Green Deal and other Government policies.
There are already a number of policies that cover the non-domestic sector including smart meters, building regulations, mandatory minimum standards for energy products, Climate Change Levy, Renewable Heat Incentive and Feed in Tariffs. These policies, together with Green Deal, target the same energy efficiency measures. The list of eligible measures has been extended to include those particularly relevant to non-domestic stock which has a greater requirement for non-insulation type products such as lighting, and ventilation. Opportunities exist for PAS 2030 installers, manufacturers and distributors of these products to supply into the market. Installation of cost-effective, energy efficiency measures and products will improve productivity, with the potential to boost growth and boost business competitiveness.
Opportunities exist too for a new category of Green Deal Advisors. Requirements differ from the domestic market as there are different levels of qualification required for assessors. Non-domestic Green Deal is assessed by accredited advisors using a standard EPC fabric assessment with the Simplified Building Energy Model (SBEM) tool. Assessments costs for non-domestic dwellings typically vary between £250 and £1,000 because of the diverse types of dwellings, their use and occupancy.
Properties with an improved energy consumption performance under the Green Deal will be more attractive on the rental market (due to green credentials and lower energy costs). Furthermore, Government statistics show that 65% of non-domestic properties are leased and as a result, there is opportunity for packaged measures that pay back in a time that is lower than the residual lease period. This becomes a more attractive proposition to leaseholders.
The Green Deal non-domestic sector also provides a significant business opportunity for economies of scale and there are already a number of innovative area-based approaches being developed, for example, by the Green Deal Consortia Ltd and its range of partner companies.
This opportunity is within your grasp and now is the time to deliver!
For more information on the Green Deal Consortia Ltd, an SME delivery model for green growth, contact the Consortia Team on 08435 065285, firstname.lastname@example.org, or www.greendealconsortia.co.uk.