I recently subscribed to Building Magazine in an effort to rationalise my media consumption. It’s been a while since I subscribed to a paid source of info and I’m a little wary. In catching up on Feb headlines I came across this one: Cities plan to invest billions in Green Deal retrofit work (£).
Really? Are they? Because we’ve looked pretty closely at Green Deal economics for people like EST and some London RPs and, for anything other than loft and cavity, it’s ropey at best. Even if you do manage to get it to meet the golden rule of payback within the asset life, it’s a massive task getting people to sign up. The hurdles are significant to say the least. A fact that’s not lost on Marks and Spencers, an early entrant who’s now distancing itself from Green Deal delivery.
So the Building headline made me do a double take and have a closer read.
There are a number of councils getting ready to make investment into retrofit. According to the article, they’re following the example of Birmingham CC, which is “currently shortlisting firms for £1.4bn of Green Deal work – bringing the total initial work to £1.7bn.”
I had a look around to find more information and it looks like Birmingham CC is actually only putting up £100m, with the money coming from borrowing and ECO money from energy suppliers (not clear on proportions). This £100m could then be increased to £400m “should the lead partner find finance.” So a lot less than the £1.7bn figure, and maybe not surprising for a council whose budget is “a ticking timebomb.”
The Building article then cites a group of ther councils queued up to make Green Deal investment:
- Newcastle and others “will issue tender docs” for £80m of retrofit work to retrofit 15k homes
- Leeds and 9 LAs “is drawing up plans” to spend £75m on retrofit in a market it “says could be worth £3.4bn.” Easy, tiger.
- Greater Manchester “is considering” investing £50m
- Nottingham “is planning” an £80m Green Deal contract
- Bristol “is considering” spending £34.6m
- West Sussex is “preparing a business case” for something in the tens of millions for retrofit
Wow, so nobody’s actually committed to spending this money other than Birmingham’s £100m (some of which is coming from energy suppliers).
Even if we made the outrageous assumption that all these councils who are considering making an investment into green retrofit actually do, the total from the above list only comes to around £330m. (If I had time this morning, my next step would be to check what these councils have spent historically on retrofit – I wonder how the above figures compare to business as usual).
It feels like some people are desperate to see Green Deal succeed and are relying on spin and hype in order to get the market moving.
So I’m trying to make two points here: 1) cities are nowhere near investing billions in Green Deal and 2) the journalist at Building seems to have swallowed a press release whole and regurgitated it into the magazine. I’m pretty sure I can get that kind of reporting elsewhere without a paywall.