Your house may not be everything you think....

I recently facilitated a two day workshop for a group of Building Performance Evaluation experts. Insights and discussions underpinned my recent blog on non-domestic buildings – you know, the one that featured turquoise carpet and the Starship Enterprise…

As promised then, here’s the blog picking up issues from the domestic sector. There is a growing body of research that indicates that new homes simply aren’t delivering what we expect in terms of energy performance (I hark back to the piece of work from BRE a few years ago that said some 60% of new homes didn’t comply with Building Regulations - if anyone can find a link to that, it'd be appreciated!).

Here are some thoughts as to why there's an energy performance gap in new homes, what we can do about it, and what might be coming next. These lessons could apply just as well (perhaps even more strongly) in the retrofit sector….

Fragmented expertise

The energy efficiency supply chain is highly fragmented, especially the further downstream you go. Design may be integrated, but product manufacture and installation are much more specialised. That specialisation has helped the consumer – you know who to call when a boiler breaks or for a wiring job – but only when we see buildings as a sum of components. When you start to think of the building as a system – with its own logic, interdependencies, feedback loops – then you need to see the supply chain as a system too.

I remember a training session I ran where a representative from a (major) insulation company sat next to someone from a ventilation company. I asked them if their companies had ever worked together. No. I asked if the insulation company had worked with any ventilation company. No. And had the ventilation company worked with any insulation company? No. So the supply chain was basically: insulation company goes in. Installs insulation. Problems with condensation and mould arise for the householder. If money is available, ventilation company comes in and retrofits ventilation. If money isn’t available, householder lives with black mould and doesn’t know why. A functioning supply chain would see insulation and ventilation as two parts of the same installation process...

Skills bleed

A bizarre phrase and not one I particularly like but it picks up an important concept.

Specialist skills have grown up in the past few years in response to market demand (often driven by incentives). Think about the skills base that we now have in solar PV and in heat pumps, and about the quality standards that have been put in place. To get an incentive, you need a certified installer and you get reassurance about the quality of work that is being done.

Now remove the incentive.

Installers see that their market is disappearing (lower incentives, less demand). There won’t be enough work to go around. Some companies will leave the market, reverting to traditional business (eg, boiler installation, routine electrical work). Those that remain in the market start to chase the shrinking customer base by competing on price. Without the lure of the incentive, there is no requirement for certification. One way to cut costs is to let your certification lapse. If you’re a good, honest professional, you’ll do the work to the same quality standards as before. If you’re not – or if you’re a new entrant lured into the market who believe you can win business on the cheap – then suddenly our customer at the end is getting a shoddy job. Their system won’t work properly, horror stories will pop up in the Daily Fail and we’ll set some of these vibrant and important industries back twenty years…

The other consideration: what about those people who just walk away from the sector? What happens to those skills? When a new incentive is brought in, do they come back? Or are those skills lost and we face another shortage and training crisis when policy shifts again?

Don’t blame the user

A common lesson from the non-domestic sector: we are quick to blame the user when a building doesn’t perform as expected. “They’re not using it properly.” “They keep tinkering with the controls.” You know the sort of thing. I covered this in the previous blog, but it’s perhaps even more important in the domestic sector as there is no energy or facilities manager on hand to re-visit and re-train people. The householder is on their own in their – perhaps bewildering – house. The onus should be on the supply chain to really put the end user at the heart of design, installation and handover.

Learning lessons

We’ve written a lot of reports over the years drawing together lessons from different policies, projects and programmes. Sometimes, when I’m feeling particularly grey-haired, I look at a new set of findings and I think “weren’t these the lessons last time?” And I realise that, as an industry, we’re very good at identifying lessons; we’re just not good at actually learning them.

Learning lessons and applying them should lead to better delivery of services. Which should lead to better performance of buildings. Which should lead to competitive advantage for those firms that did the work. The world of energy performance contracting makes this a reality – you live and die by your ability to deliver what you promised (though let’s consider the potential for “gaming” in setting the performance expectations here).

But in the normal market, without the pressure to guarantee your work, businesses don't always see the competitive advantage in implementing lessons.

Perhaps this is where consumer pressure and social media become factors. Word of mouth has always driven the domestic construction market, and word of mouth is now an online commodity. We’ll trust the online recommendation of a complete stranger for a hotel, a restaurant and now a tradesperson. If we can find a way to include ongoing performance of the building or energy service in those reviews, we can really open up the quality issues in the market. A review of a heating installer that says “she worked quickly, was tidy and charged a fair price” becomes less powerful if the review goes on “but my gas bills have gone up and I don’t know how to change the timer on the system”.

In the interests of a functioning supply chain, a more efficient market, better policy design and happier customers, we have to act on lessons learned. Don't we?

What do you think? Email liz.warren@se-2.co.uk with your thoughts or tweet @se2limited.

Thanks for reading!