Energy Matters - 2019 Edition - 2

ENERGY MATTERS 2019 - EDITION 2

PAS 2035 - A RETROFIT REVOLUTION

INTRODUCING ELMHURST RISK SOLUTIONS

ELMHURST RELEASES DESIGN SAP 10 BETA

SECR – A COMMERCIAL OPPORTUNITY FOR ALL Energy Matters / 2019- Edition 2

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FOREWORD M A R T Y N R E E D, M A N A G I N G D I R E C T O R

Welcome to the second edition of Energy Matters for 2019.

2018 was a good year for most energy assessors with a significant increase in the demand for EPCs on all strands. It is therefore pleasing to report that 2019 has started with further increases and there are good things on the horizon with policies and policy makers seeming to respond constructively to David Attenborough’s TV programme “Climate Change – the Facts” and his plea for urgent change.

Martyn Reed Managing Director Elmhurst Energy

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Energy Matters / 2019- Edition 2

Of even greater impact was Greta Thunberg, the 16-year-old Swedish student who sparked a global youth-based movement when she began a “climate strike” outside Sweden’s parliament last year, and at Westminster. The message then snowballed over Easter when “Extinction Rebellion” staged a sit in protest in London. The message was simple, and one that Elmhurst and many of our members have been giving for decades: the need for action to reduce carbon emissions to slow the impact on global warming is now more urgent than ever.

The timing of the message was especially fortunate. Prior to the Easter demonstrations there was blanket coverage of Brexit, and with the missed deadline, and no clear path forward, everyone was wanting something else to focus on. I suspect it was with some relief that the 16 year old from Sweden gave both the politicians and media something else to talk about and, for once, Brexit was removed from the front page.

Whatever the reason, we welcome the renewed focus and we urge everyone able to influence energy efficiency policy to maintain focus and deliver on their commitments.

In this edition of Energy Matters you can read about the long awaited PAS 2035 retrofit standard which is the response to the 2016 Bonfield Report / Each Home Counts. If it delivers on its potential it will turn the retrofit energy efficiency industry on its head.

PAS 2035 comes in light of perceived issues with the current systems where some products have been poorly installed in homes that are unsuitable due to their design or condition.

This new approach introduces the functions of a Retrofit Assessor and a Retrofit Coordinator who work together to produce a Retrofit Plan to maximise the improvement opportunities over the next 25 years.

It all sounds great, and planning an activity before you start is sound management methodology, however

it will come at a cost both in time taken to complete an installation and with the cost of completing the new tasks. The belief is that this extra upfront investment will be more than recouped by maximising the number of installs per dwelling, and the cost of poor quality in delaying with remediation, complaints and in some extreme cases, extraction.

Elmhurst has been involved in the design of the new PAS standard from the beginning and has done its best to keep the requirements pragmatic and

realistic. You will be able to read an article on our new Retrofit Assessor and Retrofit Coordinator schemes later in this edition of Energy Matters.

I hope that you are enjoying an upturn in business and are excited about the opportunities on the horizon. If you have any views, or want more assistance from Elmhurst then please do not hesitate to ask.

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I hope you enjoy this edition of Energy Matters and thank you for being an Elmhurst Member.

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Energy Matters / 2019- Edition 2

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CONTENTS MAGAZINE

02 FOREWORD 05 KICKING OUT THE COWBOYS 06 PAS 2035 - A RETROFIT REVOLUTION 08 ELMHURST RELEASES DESIGN SAP 10 BETA 10 LABC AND ACTIS LAUNCH THERMAL DETAILS TOOL TO HELP PROJECTS MINIMISE HEAT LOSS 12 MARKET DATA 14 ‘ENERGY’ REVOLUTION OF PRIVATE RENTED HOMES IN SCOTLAND. 16 TRAINING – COMING TO A VENUE NEAR YOU! 18 INTRODUCING ELMHURST RISK SOLUTIONS 20 SECR – A COMMERCIAL OPPORTUNITY FOR ALL 22 DOES MTD AFFECT YOU?

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Energy Matters / 2019- Edition 2

FEATURE

KICKING OUT THE COWBOYS M A R T Y N R E E D, M A N A G I N G D I R E C T O R

E

lmhurst believes that it has a duty to all members to both maintain the quality of energy certification, and to identify those who are unable or unwilling to work to the required standards.

Obviously, this investigation comes at a cost, and when it is necessary to take disciplinary action against a member, then it frequently means that we lose a customer. We at Elmhurst consider this is a price worth paying if the alternative brings our industry, which has so much good to offer, into disrepute.

We have various tools to help us identify malpractice, including auditing, but here at Elmhurst we also have the Elmhurst Quality Promise in which we commit to investigate erroneous EPCs and, if necessary arrange for their replacement.

Fortunately most complaints are simply solved with better communication and explanation but occasionally even Elmhurst gets a surprise.

A recent complaint came from an agent who had diligently checked the EPC presented by a home owner against the central register only to find that it wasn’t there. Suspecting something underhand the complaint was raised with Elmhurst and we started our investigation.

The evidence collected was presented to Elmhurst’s Accreditation Committee and their opinion was decisive; revoke membership and advise the relevant authorities, including the police. As a sign of good will, Elmhurst funded a replacement certificate and as a “thank you” for raising the issue.

The good news is that the vast majority of our members create great EPCs and we fully support their activities; but as the respected scheme in our industry we must all continue to be vigilant.

In July 2018 Elmhurst Energy launched the ‘Quality Promise’ to highlight the high standards of our members and helping the end consumers choose their Accredited Elmhurst assessor with added peace of mind.

Elmhurst is very confident that their members have received extensive training, hold the necessary qualifications and insurances to protect customers, and also have the right processes in place to deliver accurate energy assessments which comply with the latest standards.

“Wherever you see the Quality Promise badge, you know you will be employing the best” Technical Director of Elmhurst Energy Stuart Fairlie.

Elmhurst continue to support their members at every opportunity by letting the end consumers know about the ‘Quality Promise’ and that all Elmhurst accredited members are trained, competent and backed by a reputable scheme. Further literature and promotional material about the Quality Promise can be found on Elmhurst’s website.

Energy Matters / 2019- Edition 2

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HEADLINE FEATURE

PAS 2035 A RETROFIT REVOLUTION M A R T Y N R E E D, M A N A G I N G D I R E C T O R

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s Members will know, Elmhurst has been well represented on many of the working groups that spun out of Each Home Counts (AKA the Bonfield Review), as well as the PAS 2030 and PAS 2035 working groups which implemented the recommendations.

We are delighted to announce that the specification has now been published and is likely to cause a revolution in the retrofit of energy efficiency measures in domestic homes in the UK. The standard embraces a ‘fabric first’ philosophy to energy efficiency improvement, and stresses that energy assessments are to be the start of “deep retrofit” improvement plans.

If PAS 2035 delivers on its potential it will turn the retrofit industry on its head. It comes in light of perceived issues with the current systems where some products have been installed badly in homes that are unsuitable due to their design or their condition.

Rather than the installer led programme of ECO 1, 2 and 3 the new process requires a full assessment of the property and a Retrofit Plan that defines all the activities necessary to prepare and improve the property in the most effective and efficient

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Energy Matters / 2019- Edition 2

manner. Only when the plan has been agreed, will contractors be engaged to install what is ‘right for the property’, not just what is right for the installer.

The major aspects of a PAS 2035 include: • Retrofit Advisors – able to give front line advice to homeowners on what can be done to reduce energy consumption, both by making improvements and changing behaviour.

• A Risk Assessment, undertaken by a Retrofit Assessor, which includes an Energy Assessment of the property, an Occupancy Assessment and a Condition Assessment, adequate for the Retrofit Coordinator to develop a Medium Term Improvement Plan for the property.

• The cornerstone of the process is a Retrofit Coordinator who will take the output from the Retrofit Assessment (the energy assessment, the occupancy assessment and the condition assessment) and document a

Medium Term Improvement Plan that can take up to 25 years to deliver. The Retrofit Coordinator is required to be satisfied that the condition of the property, especially related to ventilation, is appropriate for the building, the occupants and the intended measures.

Only then can the installation of measures commence, sequencing the measures to maximise long term benefit. It is the Retrofit Coordinator that commissions the design of the measures, commissions the installer and acts as the homeowners advocate if things go wrong.

• Retrofit Designers will design improvement measures, paying particular attention to interfaces (junctions) where multiple improvement measures meet.

It is important to note that terms like Retrofit Assessors, Retrofit Coordinators and Retrofit Designers are functions that may be delivered by just one person.

Elmhurst has been involved in the design of the new PAS2035 from the beginning and has done its best to keep the requirements pragmatic and realistic.

Whilst originally conceived as being a process for all retrofit projects, including the “able to pay” market, BEIS has already indicated their wish that PAS2035 is made a requirement of future ECO policy meaning that the process could be applied to up to 150,000 homes per annum.

We will be announcing our new Retrofit Coordinator and Retrofit Assessor training and accreditation schemes very shortly.

For further details of our RC and RA training and accreditation please see Elmhurst’s website.

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HEADLINE FEATURE

ELMHURST RELEASES JASON HEWINS, ON CONSTRUCTION SUPPORT TEAM LEADER

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n 8th April 2019 Elmhurst was delighted to be the first commercial SAP software provider to launch an application based on the SAP 10 calculation methodology published by the Building Research Establishment in 2018.

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Design SAP 10 Beta is available to all current Design SAP licence holders and allows users to get to grips with the changes in SAP 10 by showing the new data fields that will be required to complete SAP assessments. SAP 10 is expected to be introduced into building regulations in 2020 and by getting used to these changes now will help the transition when it happens. Some areas that have seen changes include: Fuel prices and CO2 factors An item that has received a lot of industry focus is the change to fuel prices and CO2 factors in SAP 10, specifically around electricity which has seen its CO2 emission factor reduced from 0.519 kgCO2/kWh to 0.233 kgCO2/kWh in SAP 10. Whilst we do not yet know how this will affect compliance with building regulations, it is possible to compare an assessment on Design SAP 10 Beta to Design SAP 2012 to see the impact this has on CO2 emissions.

Thermal Bridging The government’s Accredited Construction Detail scheme, which currently has prescribed Psi-Values for junctions, is due to end in the next building regulations. Therefore in Design SAP 10 Beta there is no option to use the Accredited Construction Details option for junctions. Psi-Values must be sourced from another scheme such as Constructive Details, LABC Registered Details, CBA details etc., calculated by a Psi-Value modeller. Alternatively default Psi-Values can still be used but these perform poorly and will result in higher energy use and CO2 emissions. Many builders currently rely on the Accredited Construction Details scheme for junction detailing, therefore getting used to this change now is vital.

Overheating The calculation used to assess the risk of overheating has changed in SAP 10 which requires new data to be entered into Design SAP 10 Beta.

DESIGN SAP 10 BETA

If there is a security risk if windows are left unattended, and/or noise pollution prevents windows being left open, then SAP assumes that windows will not be openable in hot weather. This is likely to result in a risk of overheating unless a calculated air change rate is entered.

Lighting Due to a complete overhaul of how lighting energy is calculated in SAP 10, this has resulted in additional data entry in Design SAP 10 Beta.

Power and efficacy for all fixed lighting fittings is now required to complete assessments. This is a significant change for the industry that will require builders to provide much more detailed information to assessors to prevent the use of penalising default figures which will make compliance much more difficult.

Water Heating The calculation of hot water demand in SAP 10 has also changed and now

requires entry of the number of baths and showers in the dwelling.

Where showers are present, the flow rate for each shower type now has to be entered. Also electricity use from instantaneous electric showers will now be accounted for in SAP assessments by entering the power of each electric shower.

Photovoltaic Panels Design SAP 10 Beta allows entry of MCS overshading data rather than using the SAP default shading factors.

Also it is now possible to account for battery storage technology. Where PV is directly heating an immersion coil in a cylinder, known as a PV diverter or optimiser, this can be entered into Design SAP 10 Beta as well.

It goes without saying that being able to preview these changes in Design SAP 10 Beta is a huge asset to any On Construction assessor or house builder, with companies labelling it as “great� in their feedback and praising the team for its release.

Find out more You can find out more about Design SAP 10 Beta on our website.

We now await publication of the consultation on changes to building regulations later in the year. This will give us an indication of the proposed compliance standards for new and existing dwellings and allow the industry to fully prepare for the change to regulations expected in 2020.

Feedback Design SAP 10 Beta has been well received by our members who are already using it to understand what information they will need from their clients when SAP 10 is introduced into building regulations.

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TECHNICAL CORNER

LABC AND ACTIS LAUNCH THERMAL DETAILS TOOL TO HELP PROJECTS MINIMISE HEAT LOSS T H O M A S W I E D M E R , T E C H N I C A L D I R E C T O R U K , A C T I S I N S U L AT I O N

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rchitects, builders and specifiers looking for a foolproof way to minimise heat loss can take advantage of a new set of Registered Construction Details created by the LABC in conjunction with insulation specialist, Actis.

The Details are the first to be created for timber frame buildings within the LABC RCD scheme. They offer a combination of specific detail, good practice and points to watch, together with a range of modelled psi-values using different construction build-ups which exceed current industry standards.

The RCD drawings and documents can be fed into specifications for new projects and are also accessible onthe-go. Specific construction detail drawings (CAD) and their respective certified thermal transmittance values (psi-values) are combined with further technical design information alongside ‘on-the-go’ tools, such as links to installation tips and useful videos for builders and building inspectors.

The new RCD suite is aimed at helping construction professionals achieve as-built performance. It provides construction details and checklists of points to look out for during design and on site to help reduce heat leakage through vunerable junctions – the weak points of an insulated building envelope - and thus ‘design out’ thermal bridging.

Each available construction detail was analysed using different configurations of the Actis Hybrid range of products - reflective insulation Hybris, insulating multifoil vapour control layer HControl Hybrid and insulating multifoil breather membranes, Boost R Hybrid and Boost R Hybrid Roof.

The Details are available via the LABC portal on www.labc.co.uk.

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For example, HY10 uses HControl Hybrid, Hybris and BoostR Hybrid; HH10 combines HControl Hybrid and Hybris, while HB10 uses Hybris and BoostR Hybrid. Versions of the same details substituting Hybris with rigid board insulation or mineral fibre allow specifiers to compare the thermal efficiency produced by using alternative product combinations.

SAP trials conducted by independent energy assessors carried out on the four Actis Hybrid products demonstrate that their use has a dramatic impact on counteracting thermal bridging and achieving excellent Y-values - the heat loss of the building through linear thermal bridging - and therefore benefits the overall energy performance of buildings.

Architect and Actis UK and Ireland technical director, Thomas Wiedmer explained: “New SAP 10 calculations are expected to be included within building regulations later this year and will have even more focus on thermal bridging.

SAP

ACTIS HYBRID

Table K1

Thermal details

Default

HY

HH

HB

ψ (W/mK)

ψ (W/mK)

ψ (W/mK)

ψ (W/mK)

Detail

Ref

Window head

E2

1.00

0.037

0.046

0.053

Wall - Ground floor

E5

0.32

0.026

0.026

0.029

Wall - Intermediate floor

E6

0.14

0.054

0.056

0.063

Gable - cold roof

E12

0.48

0.035

0.012

0.050

Gable - warm roof

E13

0.08

0.045

0.022

0.053

Wall - external corner 90°

E16

0.18

0.043

0.041

0.046

The table above only provides example psi-values. The full suite is accessible via www.labc.co.uk

HOW CAN MULTIFOIL THERMAL BREAKERS HELP REDUCE THERMAL BRIDGING? Multifoil insulation products can also be described as thermal blankets as they are typically installed across the face of the main structure, creating a continuous insulation and airtightness layer.

ON-SITE EVIDENCE – THERMAL IMAGING Thermal imaging can be used to identify thermal bridging in-situ. In areas where the continuity of the insulation is not maintained, heat loss can be clearly identified and visualised.

“So it’s more and more important to look at the thermal properties of construction junctions in a wellinsulated building. Heat loss through junctions is significant and has a big impact on the overall energy efficiency of a building.

Making the fabric of the building as thermally efficient as possible and limiting thermal bridging can have an impact as high as 15% on SAP. “Part L’s Target Fabric Energy Efficiency (TFEE) rate is aimed at ensuring developers can’t build homes with envelopes that are inefficiently constructed and make up the deficiency with excessive use of renewable technologies. The targets are there to ensure the basic envelope is thermally sound – and the insulation used and its ability to eliminate thermal bridges will have a major impact on this.”

ACTIS HYBRID Thermal Details are available via the LABC portal www.labc.co.uk For continuous professional development (CPD), please contact solutions@insulationactis.com to book a seminar.

The opinions expressed in this article are of the supplier themselves and not necessarily endorsed by Elmhurst Energy.

If you would like to have your product featured here then please email info@elmhurstenergy.co.uk.

Energy Matters / 2019- Edition 2

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MARKET DATA

Existing Dwellings

M A R T Y N R E E D, M A N A G I N G D I R E C T O R

Volume of EPC lodgements on a 12 month rolling basis Volume of Residential housesales on a 12 month rolling basis

Here at Elmhurst we collect and analyse data from many sources in the belief that it helps us make better business decisions. Turning this data into a digestible form takes time and requires a detailed understanding of context.

In each edition of Energy Matters we will provide you with a snapshot of this data, with a brief commentary, which we hope you find of interest, which may help you prepare for the future.

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Commentary • House sales spiked in March 2016 on the back of changes to stamp duty and then quickly fell back to a run rate of just under 1.2 million with no indication of improvement.

• The volume of EPCs peaked in the 12 months to May 2014, driven in a large part by ECO. This fell back sharply to a low of 1.2 million in March 2018. Recent data shows a sustained recovery to just under 1.5 million, 18% up year on year. We can see that demand is not driven by residential sales but we suspect from the private rental sector (PRS), thanks to PRS/Minimum Energy Efficiency Standards (MEES), and the impact of the tenth anniversary of EPCs where some are now expiring.

Outlook • The growth in the market for RdSAP EPCs is very welcome.

It is difficult to predict whether the two drivers, MEES and the 10 year validity, are sustainable, especially when you view the surge in non-domestic EPCs which lasted about a year, but there is no evidence of a softening. It is suspected that MEES has driven up compliance in the rental sector, by simply obtaining an EPC when the rental property is being marketed, with more awareness from landlords, tenants and agents.

New Build / On Construction

Blue: Volume of residential house starts on a rolling 12 month basis Red: Volume of residential house completion on a rolling 12 month basis

Non Domestic /Commercial buildings

Volume of Commercial property EPCs in the UK on a rolling 12 month basis Non residential (commercial) property sales in the UK on a 12 month rolling basis

Note: Latest quarter data for Scotland is estimated

Volume of on-construction (new build residential) EPCs in the UK issued on a rolling 12 month basis

Commentary • Using data up to Dec 2018, home starts have now settled at just under 200,000 on a level with the previous peak in June 2017. Completions have continued to rise and are now on par with starts which indicates that work in progress has stabilised • Volume of EPCs has continued to rise and is just under 300,000

Commentary • Commercial property transactions have rise slightly in the last quester at a MAT of 126,000, down from Octobers 2018 peak of 128,000.

• The surge in EPCs that started in November 2017, which we believe was related to corporate investors preparing for Minimum Energy Standards (PRS MEES), started to soften in August 2018, plateaued for a while but has started to rise again.

Outlook • With continued uncertainty in the business community it is difficult to imagine that there will be any major changes in the commercial property sector. The impact of MEES and and ten year anniversary is well established and should now continue at similar levels.

Outlook • It is disappointing that house starts have fallen so rapidly especially with a government suggesting that house building needs to increase to 300,000 and housing charities saying up to 400, 000 homes ae required every year until 2039.

• It would be interesting to understand better whether the balance between starts and completion, almost “one-inone out”, is strategic and maybe developers have achieved an optimum level of production that they can sustain with current resources.

• The volume of On Construction EPCs is at an all-time high but with new starts slowing this may now plateau.

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FEATURE

‘ENERGY’ REVOLUTION OF PRIVATE RENTED HOMES IN SCOTLAND. S T U A R T FA I R L I E , T E C H N I C A L A N D O P E R AT I O N S D I R E C T O R

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he Energy Efficient Scotland Route Map (published May 2018) set out a requirement for landlords of private rented homes to meet minimum Energy Performance Certificate (EPC) standards from April 2020.

These Minimum Energy Efficiency Standards (MEES) will be introduced under Section 55 of the Energy Act 2011. It will require landlords of private rented homes to ensure properties achieve an EPC band ‘E’ from 1st April 2020 upon a change of tenancy, and then an EPC band ‘D’ from 1st April 2022.

According to the latest government statistics (Housing Statistics Scotland 2018) there are 2.59 million homes in Scotland of which 392,840 are privately rented (approx. 15%) With the release of Scottish Government’s most recent ‘Energy Efficient Scotland Consultation’, we may now have a clearer picture of what minimum energy efficiency standards in Scotland could look like and when we can expect the standards to be introduced.

Scottish Government state that they will “publish draft guidance for consultation shortly. Regulations will be laid in Parliament after the summer recess, subject to securing a suitable parliamentary timeslot.”

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Scottish Government state: “The proportion of dwellings that are rented privately ranges from 6% in the Shetland Islands to 26% in Dundee, with cities tending to have higher rates of households in the private rented sector.”

The consultation proposes that Private Rental Sector (PRS) standards could be accelerated so that all private rented homes must achieve an EPC band of ‘C’ by 2025, not 2030 as per the original goal.

It proposes: The Minimum Energy Efficiency Standards (MEES) within Scotland’s Private Rented Sector (PRS) would begin with a minimum standard of EPC band ‘E’ from 1st April 2020, which would then progress to EPC band ‘D’ from 1st April 2022, and landlords would need to ensure that these standards are met at a change of tenancy, where it is technically feasible and cost effective. The regulations would also introduce a cost cap of £5,000 for any required works needed for a property to meet the required EPC banding, as well as civil fines for non-compliance.

The consultation asks three questions relating to PRS/MEES: 1. What are your views on using the change of tenancy as a trigger to require the increased standard?

2. What are your views on using 1 April 2025 as the date to start applying the minimum standard of ‘C’ when there is a change of tenancy?

3. With regards to providing a useful tool to landlords planning and executing improvement works, what are your views on basing any cap of required works on a definition of cost-effectiveness and technical feasibility?

What next?

Elmhurst’s Technical and Operations Director Stuart Fairlie comments that “Although no official MEES regulations have been released in Scotland, the intention from Scottish Government to speed up its longer term implementation is clear. The Government has stated within the consultation that draft regulations and guidance will be published shortly, with an aim to have the full regulations released in the autumn, to go live in April 2020. The introduction of these important standards is just around the corner. Elmhurst has responded to the current consultation, including the questions stated, and vitally once the ‘detail’ around the proposed regulations becomes clearer we will inform all our members.”

“The introduction of MEES in England and Wales has had a massive impact

in the private rental market and is driving the improvement of some of the worst energy efficient homes.

Landlords have been affected, and energy assessors can certainly help homes become better. We await to see the ‘real detail’ around how it will be implemented in Scotland, and as ever we will ensure that our members are given the best advice and guidance so that they can help landlords and tenants meet the challenges ahead.”

Elmhurst plans to keep its members and other energy professionals updated through its MEES in Scotland webpage which aims to provide all the latest information about energy efficiency standards in Scotland. The page will also be updated in accordance with the latest announcements and releases from Scottish Government.

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FEATURE

TRAINING – COMING TO A VENUE NEAR YOU! M I T E S H N AT H WA N I , T R A I N I N G M A N A G E R

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ver the last year, we have seen a real upturn in the numbers of assessors, old and new, signing up to our qualification and CPD courses, driven by people wanting

to update their skills, knowledge and understanding.

Part of this growth has been led by the 10 year anniversary of EPCs as well as the introduction of the Minimum Energy Efficiency Standards (MEES), which affects both domestic and non-domestic property markets.

a week-long training event that takes place in different parts of the UK with all three strands taking part.

Therefore ensuring that no matter what strand you work in, there is a CPD course happening for you.

We have also introduced a whole array of new courses for all strands: Domestic Ventilation, ESOS qualification and refresher courses, Thermal Bridging, Heating and Renewables, Part L1A and Part L2A Awareness, just to name a few! Our aim is to be the best in the training field and ensure we have enough of an offering to help our members stay ahead of the competition. With that in mind we have also launched an array of new webinars and are working at ways to make our courses more accessible for those living far away or who find it hard to travel to our venues.

We’ve been to Scotland and the south of England twice so far. Each time, our numbers have grown as more and more people have become aware of us being in their locality, showing that our training really is second to none and I strongly believe that. We had 100 assessors attend our training courses in one week on one of these roadshows, showing just how high a regard assessors put on the training we offer. With that in mind I would like to thank those of you who attended these roadshows and made them such a success – a huge thank you. As well as our trainers and support team without whom, the roadshow would not be possible.

The last twelve months have also had us venture further afield; we have gone out and about in the form of the Elmhurst Energy Training Roadshow, 16 Energy Matters / 2019- Edition 2

If you missed out on one of our training roadshows, don’t worry we will be coming to a city near

you soon. The next roadshow is our northern England and Wales roadshow. We’ll be in Durham, Leeds, Manchester and Wrexham in July, followed by Scotland (September), northern England (February 2020) and Scotland again (March 2020).

I am also planning a roadshow in Northern Ireland and Wales in the near future, keep an eye on our Training Calendar for more information.

Such is the growing demand for training courses that we have recently had many flourishing collaborations come into place, with the likes of Propertymark, LABC, CABE, NICEIC, NHBC, Design Builder as well as others, that has helped grow our portfolio of courses. We are always on the lookout for new course offerings which will help our

members grow their knowledge and expand their service offering for customers. An example of this is the Propertymark Level 3 Award in Residential Inventory Management & Practice - England and Wales.

In reality, I can only see this coming year getting bigger and better for our members and our delegates; new courses, new trainers, new geographical areas covered and more new collaborations which will bring a whole new range of things to help assessors and their businesses grow.

website to ensure you do not miss any important energy related and training announcements. Also please make sure you follow us on Twitter, LinkedIn and Facebook. Lastly, if you believe there is anything we can do to make our training even better, please do not hesitate to get in touch with me. For those of you I haven’t had the pleasure of meeting, I will be out at the roadshow events so I’ll hopefully catch you there. All the best for the year ahead and thanks again.

Overall, we plan to better the last few years and I’m hoping to make this year the best yet. This can only be possible with your continued support and the hard work our trainers put in. Please keep an eye out on our training calendar and

Energy Matters / 2019- Edition 2

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FEATURE

INTRODUCING ELMHURST RISK SOLUTIONS D O M I N I C R E E D, M A R K E T I N G M A N A G E R

E

lmhurst Energy would like to introduce Elmhurst Risk Solutions, our trusted insurance partner who provide enhanced insurance cover exclusively for Elmhurst accredited members.

Elmhurst’s insurance policy currently provides free Professional Indemnity (PI) and PL cover for accredited members, up to the value of £10 million. This will typically cover members for the production of certificates and reports within their profession.

However, additional activities commonly undertaken by members such as offering advice (non-verbal, binding), providing explanations, and giving guidance to property owners, is not covered by this policy. These activities are important for energy assessors who want to deliver a full energy assessment and advice service to their clients. The most attractive insurance policy available for energy assessors is the enhanced PI cover from Elmhurst Risk Solutions which provides cover across all strands of energy assessment. This PI policy has been developed to equip Elmhurst members with the necessary cover to undertake activities such as energy 18 Energy Matters / 2019- Edition 2

saving actions that the occupants can do for themselves and advice on energy efficiency legislation that impacts on building owners (e.g. minimum energy efficiency regulations), including how to comply or claim exemption.

Due to Elmhurst’s market leading position, members can also benefit from the lower premiums which Elmhurst Risk Solutions offers to Elmhurst accredited members.

Martyn Reed, Managing Director of Elmhurst Energy comments “Our partnership with Elmhurst Risk Solutions will allow members of all strands to access insurance policies which are both relevant and affordable.

The energy assessment role expands beyond that of lodging and submitting reports, which is reflected by the activities covered under the enhanced PI insurance. Accredited

Enhanced PI Cover from Elmhurst Risk Solutions will cover: Energy assessment using the methodology for which the assessor is accredited, but where the reports are not submitted to Elmhurst Production of ad hoc reports to demonstrate the viability of energy saving improvements Floor plan diagrams for use by the agent in promoting the property for sale or rent Photographs for use by the agent in promoting the property for sale or rent Energy saving actions that the occupants can do for themselves Referring building owners to the government endorsed list of approved installers that are able to deliver the recommended measure Advice on energy efficiency legislation that impacts on building owners (e.g. minimum energy efficiency regulations) and how to meet them or to claim exemption Offering advice to achieve building regulatory compliance Various calculations to establish a buildings energy performance such as: > Psi-value > U-Values > Water use calculations > Over heating calculations

Energy Matters / 2019- Edition 2

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FEATURE

SECR – A COMMERCIAL OPPORTUNITY FOR ALL

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L U C Y D AV I E S , B U S I N E S S D E V E L O P M E N T M A N A G E R

limate Change, energy use and energy efficiency topics have been the focus of much of our news lately, thanks to the latest report from the Committee on Climate Change, which has addressed government environment targets, and helped to pave out the new map to a ‘net zero economy by 2050’.

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This increased attention is undoubtedly finding its way into board rooms, where key decision makers consider their environmental impacts, and their legal and moral obligations to understand the impact they’re having. For a few years now, the largest UK companies have been instructed to partake in Mandatory Greenhouse Gas Reporting, the Carbon Reduction Scheme, and many other voluntary frameworks, such as the Carbon Disclosure Project (CDP). However, it has been highlighted and recognised that the numerous frameworks for environmental reporting were creating administrative and financial burdens for businesses.

Therefore, following several consultations throughout 2017/2018, the government has tried to simplify the way in which large UK companies report on their energy use and carbon emissions. The new Streamlined Energy and Carbon Reporting Framework (SECR), effective from 1st April 2019, aims to achieve this, as well as helping large businesses to measure, manage and reduce their energy use.

As energy assessors, who work to improve the energy efficiency of the built environment, we understand how important it is for businesses to understand their energy use, and identify ways in which they can save energy and therefore save money.

For large UK businesses, who meet certain criteria, ESOS has been in place since 2014/15, as a four – yearly audit of energy use. Phase 2 of the scheme is now underway, with a deadline of 5th December 2019. SECR applies to a similar number of companies, meeting similar criteria, meaning for Non – Domestic Energy Assessors, and ESOS Lead Assessors, a new opportunity has arisen to provide ongoing energy consultancy.

From the first reporting year beginning on or after 1st April 2019, businesses meeting the criteria must include details of their energy use and emissions, alongside narrative commentary on any energy efficiency action taken, in their Annual Reports.

Unlike ESOS, this reporting has to be undertaken on a yearly basis, in line with financial reporting, and the good news for assessors is that there is no additional qualification needed to be able to assist businesses with their SECR compliance.

SECR framework will replace the CRC scheme which ceased in April 2019, and mandatory greenhouse gas reporting, which has been in place for

all quoted companies since 2013. The framework will apply to all quoted UK companies, some LLPs who have previously been mandated to partake in CRC scheme and ESOS, and all large unquoted companies who meet two of the three following criteria: • 250 or more employees • Annual turnover in excess of £36 million • Annual balance sheet total in excess of £18 million For those quoted UK companies, reporting must include data on global energy use and associated emissions, whereas all other large companies must only report on UK energy use and associated emissions. All companies must provide a yearly comparison to previous years, from year 2, and some narrative on any energy efficiency action undertaken in the financial year for which they are reporting.

As qualified and accredited commercial energy assessors, or ESOS Lead Assessors, many of you will already possess the skill set and knowledge required to assist these companies. There is no standard

practise that must be adhered to, although the government has released a guide of best practice, for which Elmhurst will be providing some CPD courses relating to. As long as all data is included, and is presented within the Annual Report, companies will be considered compliant.

Elmhurst believes that SECR will provide a much more efficient reporting system, which will allow businesses to identify where reductions can be made in energy use and emissions, and work to reduce figures year on year, which will create cost savings as the cheapest energy is the energy we don’t use.

We also consider SECR to present a real opportunity for our assessors to expand on the services offered, and provide consistent consultancy to large businesses. For ESOS Lead Assessors, the companies who are completing ESOS, will likely also meet the criteria to complete SECR, so offering the additional service will help to bridge the gap between the various phases of ESOS to keep a working relationship with clients.

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GUEST FEATURE

DOES MTD AFFECT YOU? T R U S H A L A K H A N I , N O N - E X E C U T I V E D I R E C T O R AT E L M H U R S T

What is MTD? The UK government has introduced a new initiative, Making Tax Digital (MTD), with the aim of making tax simpler for taxpayers. HMRC started its roll out on 1st April 2019, and it affects many small businesses, so you may want to speak with a qualified accountant to see how this affects you. Hopefully this high-level guide on MTD helps you with the conversation with an accountant.

HMRC is doing a gradual roll out of Making Tax Digital, starting with Making Tax Digital for VAT. The first rollout was 1st April 2019 and the next one is on 1st October 2019

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Will I be affected by MTD? It depends on the size and type of your business, and it is worth noting that you do not have to be VAT registered when it affects you.

The first tranche of businesses to be affected will: • be VAT registered • have a taxable turnover above the VAT threshold (currently £85k) when MTD begins.

Should both of these apply to you, and your organization is not within the exemptions criteria, then you are likely to be affected by MTD rules.

This includes businesses whose revenue exceeds the VAT threshold during the year, so please do keep an eye on your turnover, or have a chat with your accountant.

It is also worth keeping in mind that once you’ve exceeded the £85,000 threshold, you’ll always be required to follow the rules for MTD, unless you deregister from VAT. So who is exempt?

Businesses that are already exempt from filing their VAT returns electronically are also exempt from MTD for VAT, unless they choose to take part, which they can do by informing HMRC in writing.

Can you wait till 1st Oct 2019?

The organisations that can wait until 1st October 2019 before they need to follow the MTD rules fall under the following categories: • Trusts • ‘Not for profit’ organisations that are not set up as a company • VAT divisions • VAT groups • Government departments • NHS Trusts • Local authorities • Public corporations • Traders based overseas • Those required to make payment on account • Annual accounting scheme users

What’s different?

This is where it will be wise to seek accounting guidance from a suitably qualified finance professional.

Businesses that are affected by the MTD for VAT rules ͳͳ will need to file their VAT records digitally using HMRC recognised software ͳͳ File quarterly (or more frequently) if required by HMRC using their Government Gateway, and ͳͳ keep and preserve their VAT records in a digital form.

What records should you keep?

HMRC has ruled that the following must be kept digitally in order to comply with MTD for VAT: • Business name and contact details • VAT number & scheme used • Adjustments • VAT on supplies made & received • Time of supply or receipt • Net value (excluding VAT) • Rate of VAT charged or that you will claim back • Daily Gross Takings (DGT) – retail scheme users only • Value of sales made under Gold Accounting Scheme (if applicable) • Total output tax on purchases under Gold Accounting Scheme

How do I keep and preserve digitally?

A spreadsheet is fine for recording and storing all of this information, but you’ll still need to link it with other software in order to file your details with HMRC (see below). If you’d rather keep things simple and do everything in one place, we recommend using HMRC-recognised software.

Most businesses do keep some form of digital records. Many still use spreadsheets to help manage their finances and others use specific accounting software such as Xero, Quickbooks, Sage and there are many more that are recognized by HMRC. It is recommended to use HMRC recognized software so as to keep things simple and organized (much like RdSAP Go), but if you prefer to use your current system please do check with a local qualified accountant who will be able to advise you.

If your records are on a spreadsheet A spreadsheet may be sufficient for recording and preserving your VAT records for a little while longer, but you will be required to link it with other software in order to file your return with HMRC. HMRC understands that MTD will be a big change for some businesses. So for a short period they’re allowing businesses to continue using spreadsheets to record and calculate their VAT returns. However, submitting them will require additional software.

To submit the return, the final values for the VAT return must be imported into HMRC-recognised MTD-compliant software using something called ‘bridging software’.

Our advice is to check on the HMRC website and take advice from a Chartered or Certified Accountant. The qualifications to look for are CA, ACCA, CIMA, AAT. They are prepared for MTD for VAT and will be able to advise you.

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Low premiums 0% interest Direct Debits Immediate coverage No admin fees if you amend your policy

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For more information visit: www.elmhurstenergy.co.uk