2013: The year of clarity?

With 2013 now upon us, industry attention eagerly turns towards expectations for the next 12 months. Neil Schofield gives an insight into the key milestones and trends we can expect to see this year and what this means for the next generation of the industry’s professionals.
While it could be said that delays to the introduction of the Government’s RHI and Green Deal over the last 12 to 18 months have caused a great deal of confusion for manufacturers, merchants and heating engineers alike, 2013 could see the introduction of a clear roadmap for the industry to follow.
The hike in fuel costs by the ‘Big Six’ energy providers last autumn acted as a true reminder of how important it is that we reduce our reliance on fossil fuel – minimising householder expenditure and emissions in the process. The key to mitigating rising energy costs and creating new business for the industry’s installer base is the Government’s flagship heating incentives, as well  as the boiler replacement market, with some 1.5 million replacements taking place every year.
Unlocking the Green Deal’s potential
Crucially, in setting a date for the introduction of the Green Deal, DECC has offered some reassurance that affordable and achievable measures of improving energy efficiency is more than a mere pipe dream. The addition of a cashback incentive for boiler upgrades is certainly a welcome enhancement of the scheme, which is sure to give it the kickstart it needs.
We have to remember that while home insulation will help to minimise household energy expenditure, it should be considered part of a wider strategy to improve efficiency. After all, upgrading to a condensing boiler is the simplest way for a UK householder to improve their prospects over the longer term.
The one limitation to the Green Deal, however, is its administration. With work covered by the Green Deal only accessible to those who are ‘Green Deal accredited’, the coming months will challenge manufacturers and industry bodies to support  those installers wishing to take advantage of what should be considered a profitable business opportunity. A substantial sum (in the region of £3 million) has been set aside for the training of Green Deal installers and assessors, but this must be balanced with a scheme they want to be a part of.
Inevitably, we will see an influx of training programmes and accreditation schemes over the first quarter of the year, introduced to enable competent installers to add that all-important qualification to their repertoire. Without doubt, the professional development of our installers should be embraced wholeheartedly. However, it could be argued that there simply hasn’t been enough time to enable training providers to prepare their programmes ahead of the Green Deal coming into force.
Another point to consider is that while most installers embrace training and accreditation with enthusiasm, the bureaucracy, costs and audit procedures of maintaining accreditation is time consuming and in the words of some installers – “more trouble than it’s worth”.
What we have been advised to expect to see over the weeks and months to come is a large-scale consumer advertising campaign around the Green Deal and RHI. The extent of the Green Deal’s success will ultimately stem from the level of interest generated amongst homeowners. The local heating engineer can make his customers aware of the incentives on offer. The Government, however, needs to create a demand for what remains a relatively low-profile offering.
RHI clarity
The Renewable Heat Incentive (RHI) is the other key Government initiative that the heating industry will be keeping a close eye on in 2013. Having been the cause of much frustration since its conception – thanks to a series of delays – a range of tariffs has finally been proposed as part of a consultation phase, which should result in the scheme being  introduced in full at some point later this year.
The RHI is unlikely to transform the way we heat our homes, but it should provide a great middle ground by encouraging hybrid heating systems where a boiler works alongside a renewable heating and hot water source. The integration of hybrid technologies as part of the installer offering for consumers is the next step towards a wholesale reliance on renewable technologies. This may ultimately be achievable, but there is still some work to be done in changing the mind-set of the UK homeowner.
Like the Green Deal, the RHI arguably has scope for improvement. For instance, the RHI in its current form omits some renewable heating technologies such as bio-oil condensing boilers altogether. In 2013, it would be ideal to see more understanding of products and our industry by key decision makers. This has to be addressed if installers are to provide homeowners the best solutions to suit their needs.
Backing the boiler
Without doubt, the last two years have been tough for the construction industry as a whole, and boiler sales have suffered as a result. In fact, boiler sales reached a 10-year low during the first six months of last year, which was a real signifier of the tough climate for installers. On a positive note, early signs indicate that 2013 is likely to see this decline slow significantly – or at least begin to plateau. This could result in the regaining of a period of growth as early as next year.
What could be crucial to the slowing of this sales decline is the aforementioned Green Deal. The initial funding made available to  subsidise a boiler upgrade has the potential to be the biggest game changer since the boiler scrappage scheme in 2010, although the incentive needs to be publicised for it to be shaken into action.
Regardless of the schemes or incentives on offer, we have to remember that there are some 20 million gas-fired boilers installed in properties around the country, which means that the market for boiler replacements and servicing remains strong. The challenge for installers is to change homeowner mentality to ensure the benefits of a boiler replacement are realised and invested in rather than
being the result of a winter distress purchase.
There is little doubt that the Green Deal and RHI can make an enormous contribution to reinvigorating the UK’s housing stock and give the heating industry a much-needed boost. However, there are obstacles that need to be overcome and opportunities that must not be missed. Most importantly, if we are to genuinely improve the energy efficiency of homes, the UK’s installer base must be listened to and must be enabled to get involved.
[author image=”https://www.installeronline.co.uk/wp-content/uploads/2012/10/Neil-Schofield-cutout.jpg” ]Neil Schofield is Head of Government and External Affairs at Worcester, Bosch Group. He has been in the heating industry throughout his career, starting at British Gas in 1987. More recently, Neil has become the manufacturer’s ‘Man in the Ministry, leading Worcester on industry legislation and ensuring the company is at the forefront of providing support for any new changes. [/author]