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Green Deal Guidance for the Water Sector (2012)

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This guidance was developed by Waterwise and the Energy Saving Trust to help increase and simplify the delivery of joint energy and water efficiency programmes, through partnerships working between water companies and energy efficiency programme providers. This includes the Green Deal, ECO and other local authority energy efficiency/fuel poverty-led in-home schemes. The guidance addresses aspects of how to design effective water and energy partnerships, which devices to install when, how to engage and advice customers, and information on expected water, energy, and money savings.

1. Background to Green Deal and ECOThe Green Deal and Energy Company Obligation

The Green Deal and Energy Company Obligation (ECO) are energy efficiency retrofitting programmes led by the government but delivered independently of it, by registered Green Deal Providers and energy companies.

Green Deal covers households and non-domestic properties. Customers can take out a Green Deal from the end of January 2013. Energy efficiency retrofitting measures will be financed through a loan scheme (set up through legislation) repaid through savings on energy bills. Green Deal will include at least two visits, one each from an advisor and an installer.

ECO is designed to complement the domestic Green Deal. ECO will combine with Green Deal finance to make some of the most effective carbon-saving measures affordable under the Green Deal. ECO will also be used to provide insulation and heating measures to low-income and vulnerable households and insulation measures to local communities.

The Government, regulators and water companies are clear that water efficiency is to play an important role in future water company plans. The December 2011 Water White Paper „Water for Life’i states that;

“The Green Deal is an opportunity to get targeted advice to households on steps they can take to improve the sustainability of their properties, including measures to improve water efficiency. The Government is working with industry and other stakeholders to develop water efficiency advice which will be available when a household or business is looking to find out more about the Green Deal or undergo a Green Deal assessment. Water companies have an opportunity to promote water efficiency by working with Green Deal assessors who are visiting homes andworkplaces.”

The opportunity for including water

Water efficiency can offer significant energy, carbon and other household bill reduction savings for Green Deal, ECO and other in-home energy efficiency schemes. Hot-water-saving devices such as showerheads and taps have been included in the Green Deal List of Measures. Water use in the home accounts for on average 23% of domestic energy consumption, and with clear evidence that the target householder audience prefers a joint delivery mechanism, addressing energy and water savings together is becoming a more common and successful approach.

Combined energy and water delivery initiatives have been or are currently being delivered in many areas in England, Scotland and Wales. These seek to integrate simple water efficiency device installation and advice provision into existing energy efficiency/fuel poverty delivery schemes. These schemes are predominantly aimed at domestic building stock, but can also benefit non-domestic buildings.

The introduction of Green Deal / ECO, alongside similar in-home energy efficiency schemes, potentially increases the long-term opportunities to install water-saving devices and reach households with related targeted advice. Showerheads and taps have been included in Green Deal‟s List of Measures, What measures does the Green Deal cover?ii. The Government stated during the Green Deal and ECO consultation that;

“Water companies and Green Deal Providers could create partnerships to see a range ofwork being done in the property all at the same timeiii.” (DECC, 2011)

Following a „Water Sector – Green Deal‟ meeting held by Ofwat in July 2011, it was clear that therewould be benefit in developing a simple Guidance document, suitable for water companies, DECC and Green Deal Providers, outlining what types of water devices and educational materials the water sector would recommend for integration in Green Deal delivery to households, as well as methods of delivery and associated issues. This Guidance has been developed to assist future partnership working between Green Deal / ECO delivery schemes and water companies.

The regulatory framework for water and the Green Deal

Water companies have made notable advances in the scale and quality of their water efficiency retrofitting and advice programmes over the last two price review periods.

However, both the Water White Paper and the Water Resource Planning Guidelineiv published by Defra, the Welsh Government, Ofwat and the Environment Agency in June 2012 make it clear that water companies will be required to significantly increase the level of demand management in both their 25- year Water Resource Management Plans and in their plans for the next five-year price review, in 2014. The guideline states:

“Government expects water companies to show in their water resources management plans how they will promote efficient water use and the impact that will have. Where a company is in an area designated as water stressed, or where it has demand that is above the national average (147 litres per head per day) Government expects the demand trend to besignificantly downwards”.

But both the Guideline and the Water White Paper are explicit that an increase in water efficiency activity is required across the industry, and not only in areas currently defined as water-stressed, and cite the need to manage demand: all companies will be expected to show how they will reduce water use per person.