Decision details

Greendeal Application for External Wall Insulation to Council Properties

Decision Maker: Officer Decision

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: No

Purpose:

Background:   

 

1.            Introduction

 

1.1         Ipswich Borough Council is committed to maintaining and improving its housing stock. To date the Council has taken advantage of two external wall insulation schemes, by maximising the number of properties that could be insulated through successful grant applications to the Community Energy Savings Programme (CESP) and Energy Companies Obligation (ECO). A further opportunity has arisen to insulate another 45 properties by making an application to the Greendeal fund. 

1.2         The Greendeal funding is time limited, formal applications which include full property surveys must be submitted by the 30th June 2014, with funding awarded on a first come first served basis and the works to the properties must be completed by the 30th September 2014

1.3         Sustain Services Ltd, the sub-contractor that previously installed external wall insulation (EWI) on IBC properties under the CESP and ECO programmes, have submitted a proposal to utilise the Green Deal Cash Back scheme.  Sustain are a Green Deal Provider registered for the cash back scheme which would allow IBC to access the funding.

1.4         At its meeting on 11th February 2014, as part of report E/13/79 Energy Company Obligation - External Wall Insulation, Executive resolved

 

“That the Head of Housing and Customer Services in consultation with the Housing Portfolio Holder and the Head of Corporate Services be authorised to enter into an agreement (subject to sufficient budgetary provision being available) to take such opportunities as they find reasonable to complete the provision of external wall insulation if any such opportunity arises and the scheme is advantageous for the Council.

 

                                    Reason: To enable the Council to take advantage of time limited funding opportunities.” (Minute 158. (iii))

 

2.         Scheme Details

2.1      Cash back funding is from a committed fund and is issued on a first come first served basis, so the earlier the application is made the more chance of funding being available.

2.2      Applications for funding must be finalised by the 30th June 2014, EWI installations must be completed by the end of September 2014. However properties to be included  in proposed schemes need to be surveyed by Sustain Services and audited by a Greendeal Auditor before the application can be made significantly reducing the 30th June deadline. These surveys are a significant amount of work for Sustain and they have asked that we raise a purchase order prior to the commencement of the surveys. The Greendeal funding cannot be secured without these surveys. Once the application is made and the funding secured the cashback will be sent to IBC. No works will commence prior to notification of a successful application.

2.3      The maximum funding available is £4,000 per property, with a maximum of £160,000 overall.

2.4      The number of homes that benefit from external wall insulation is dependent on the size of property and on the contribution that IBC would make.

2.5      The funding is not linked to ECO, therefore gives confidence of a guaranteed project.

2.6       The project can contribute towards carbon reduction targets.

2.7       Where necessary loft top up insulation would be included within the programme

2.8       All adjacent private home owners will be given the same opportunity with the possibility of street by street re-development, enhancing the street value and living environment (this will not detract from the IBC available budget).

 

2.9       Sustain Services have proven there quality standards on previously completed schemes and their quoted cost for an installation is well within guidance from the Energy Savings Trust who advice that the average cost for solid wall insulation based on a three bedroom, semi-detached house could be in the region of £9,400 to £13,000, which gives confidence that the cost of the proposed works is reasonable.

 

 

 

 

 

2.7    IBC will have a JCT contract with Sustain Services Limited for delivery of the scheme.

 

3.         Finance

3.1      The current insulation budget 2014/15 is £255,000, however, £150,948.16 of this budget will be spent on the final payment of the completed ECO project as detailed in the 11th of February 2014 ECO project Executive report E/13/79. The remaining 2014/15 budget is, therefore, £104,051.84.

3.2      Using the scheme, Sustain have offered up to the maximum of £4,000 per property with a maximum funding allocation of £160,000. To maximise this funding 40 homes would need to be completed. The number of properties treated with EWI is dependent on the size of property and on the contributions from IBC.

3.3      Informal conversations have been held with other suppliers for price comparison purposes. They have told us that their price for a 3 bed property would be higher than that quoted by Sustain.  As stated above the price is lower than the cost estimated by the Energy Savings Trust.

3.4                   There is sufficient HRA budget overall to cover the additional costs, although an increased contribution from Revenue to Capital will be required.

3.5      As stated above Sustain have requested a purchase order be raised to cover the cost of the surveys at £500 per property, totalling £22,500. This is included within the total cost of the scheme to IBC.

4.         Options Considered

4.1      Option A

Complete EWI to the remaining concrete semi-detached houses on Greenwich estate not previously completed as part of the CESP or ECO projects, in Robeck Road (35 No.) and Hogarth Square (10 No.) This option covers properties in Robeck rd & Hogarth square which were to be the next phase of the Eco scheme and the tenants had been informed of this prior to the Eco scheme being stopped.

Estimated Cost

45

 £        8,663

 £  389,835.00

Less Funding

40

 £        4,000

 £  160,000.00

Total IBC Cost

 £  229,835.00

Budget available

 £  104,051.84

Plus 2014/15 Planned Maintenance

£ 16,074

Increased Revenue Contribution to Capital

 £  109,709.16

 

Advantages:

·         Would complete all remaining concrete homes on the Greenwich estate that were unable to be completed because of funding eligibility changes from CESP to ECO, which left disappointed tenants and their homes with poorer standard thermal efficiency levels than other same type homes.

·         Completing the 45 properties makes a natural geographical boundary to the project rather than leaving 5 properties outstanding.

·         If ECO funding rates increase, this property type would not be eligible for funding.

·         Would improve thermal insulation on these houses and subsequently help tackle the condensation related issues with these homes.

·         Would help reduce the heating costs for tenants.

·         Would save £16,074 on the painting of existing render due in 2014/15.

            Disadvantages:

·         There are 45 homes that require EWI to complete these property types on the Greenwich estate, therefore, 5 homes would not attract any funding.

·         An increased Revenue Contribution to Capital of £109,709.16 would be needed.

 

4.2         Option B

            Complete EWI to the 35 No. semi-detached houses in Robeck Road only.           

Estimated Cost

35

 £        8,663

 £  303,205.00

Less Funding

35

 £        4,000

 £  140,000.00

Total IBC Cost

 £  163,205.00

Budget available

 £  104,051.84

Plus 2014/15 Planned Maintenance

£ 12,502

Increased Revenue Contribution to Capital

 £    46,651.16

 

Advantages:

·         Would complete all remaining concrete homes on Robeck Road that were unable to be completed because of funding eligibility changes from CESP to ECO funding which left disappointed tenants and their homes with poorer standard thermal efficiency levels than other same type homes.

·         Would improve thermal insulation on these houses and subsequently help tackle the condensation related issues with these homes.

·         Would help reduce the heating costs for tenants.

·         Would reduce IBC costs.

            Disadvantages:

·         There are 10 homes in Hogarth Square that require EWI to complete the same property types on the Greenwich estate where tenants may again feel disappointed and left out.

·         Would not maximise the available funding being less than 40 houses.

·         An increased Revenue Contribution to Capital of £46,651.16 would be needed.

4.3         Option C

Complete EWI to 52 No. solid brick terraced houses in Bramford Road (32 No.) and Henniker Road (20No.)     

Estimated Cost

52

 £        8,635

 £  449,020.00

Less Funding

40

 £        4,000

 £  160,000.00

Total IBC Cost

 £  289,020.00

Budget available

 £  104,051.84

Increased Revenue Contribution to Capital

 £  184,968.16

 

Advantages:

·         Would complete EWI to all the IBC solid wall homes in these roads.

·         Would improve thermal insulation on these houses and subsequently help tackle the condensation related issues with these homes.

·         Would help reduce the heating costs for tenants.

 

 

Disadvantages:

·         There are 52 house that require EWI to complete all these property types in Bramford and Henniker Roads, therefore, 12 homes would not attract any funding

·         An increased Revenue Contribution to Capital of £184,968.16 would be needed.

 

4.4         Option D

Complete EWI to 41No.solid brick terraced houses only in Bramford Road (32 No.) and top end of Henniker Road (9 No.)

Estimated Cost

41

 £        8,635

 £  354,035.00

Less Funding

40

 £        4,000

 £  160,000.00

Total IBC Cost

 £  194,035.00

Budget available

 £  104,051.84

Increased Revenue Contribution to Capital

 £    89,983.16

           

Advantages:

·         Would maximise the funding and minimise the IBC contribution.

·         Would improve thermal insulation on these houses and subsequently help tackle the condensation related issues with these homes.

·         Would help reduce the heating costs for tenants.

 

Disadvantages:

·         There are 52 that require EWI to complete these property types on Bramford and Henniker Roads, therefore, 11 homes in lower part of Henniker Road would not be completed, which may disappoint the tenants and leave lesser standard same type houses.

·         An increased Revenue Contribution to Capital of £89,983.16 would be needed.

 

4.5    Option E

 

Complete EWI to the 22 No. semi-detached houses in Robeck Road only

 

Estimated Cost

24

 £        8,635

 £  207,240

Less Funding

24

 £        4,000

 £  96,000

Total IBC Cost

 £

Budget available

 £  104,051.84

Plus 2014/15 Planned Maintenance

£ 8,572.80

Increased Revenue Contribution to Capital

 £    0.00

 

Advantages:

·         Would remain within the existing budgets

Would improve thermal insulation on these houses and subsequently help tackle the condensation related issues with these homes.

·         Would help reduce the heating costs for tenants.

 

Disadvantages:

·         There are 45 homes that require EWI to complete these property types on the Greenwich estate, leaving 23 properties uninsulated which would disappoint tenants and leave them with a lesser standard of the same type houses.

 

 

5.         Conclusion

5.1 All of the options outlined above are viable subject to a range of top up revenue contributions. The properties in Robeck rd & Hogarth square were to be the next phase of the Eco scheme and the tenants had been informed of this. They were let down when the Eco scheme suddenly stopped. Option A is the only one that covers all these properties. Option A is also recommended because it is the only option that

·                    completes all outstanding hard to treat properties in a locality (in this case the

Greenwich estate),

·                    maximises the £160,000 funding potentially available and

·                    is the lowest top up revenue contribution that meets the above criteria

 

5.2   The Housing Portfolio Holders preference is to treat all properties in a locality. The Head of Housing and Customer Services view is that option A is the only option that provides a satisfactory investment return and meets the criteria set out in paragraph 5.1

 

5.3  The other advantages of option A are that:

·                    This property type is very unlikely to attract any other government funding in the future

·                    Tenants in the same property type and locality would be treated equally

·                    Some Tenants, who were disappointed when the funding from the ECO scheme was withdrawn, would all have their properties upgraded.

·                    It would improve thermal insulation on these houses and help reduce the heating costs for tenants and address the condensation related issues with these homes.

 

 

 

 

 

 

Decision:

Decisions:

 

7.1 To work with Sustain Services Limited to make a Greendeal application to part fund and install external insulation to 45 council properties (option A) and to fund the remainder of the works from the Housing Revenue Account capital programme.

 

7.2 The Chief  Executive exercises the authority under 10.1 (k) of the Officer Delegation Scheme to take a decision on this Executive function, in consultation with the Leader because the offer is time limited and the decision needs to be made before the next scheduled Executive meeting

 

7.3 To increase the HRA revenue contribution to capital by £109,709.16 for 2014/15 funded by the HRA working balance.

 

 Reasons for above:

It resolves the issues with previously disappointed tenants and all the remaining poorly insulated concrete homes on this estate and at the same time will help address issues with condensation within these homes.

 

The Cash Back offer is given on a first come first served basis, so the earlier the application is made, the more chance of successfully obtaining the funds. The scheme demonstrates value for money by accessing Greendeal funding.

 

To ensure the capital programme is fully funded

 

 

 

Publication date: 04/06/2014

Date of decision: 20/05/2014

Accompanying Documents: