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Policy and Value: A Case Study of Local Authority Energy Management and Retrofit Investment Appraisal Paul Price Dissertation submitted for the award of MSc. Sustainable Development Dublin Institute of Technology October 2012

Volume 1 of 2


ABSTRACT Saving energy, reducing carbon emissions and cutting costs through improved energy management and retrofit investment are significant national and local policy aims, with the public sector being given an exemplar role. Is implementation of these policies consistent with good practice in energy management and retrofit investment? A survey of Dublin City Council (DCC) leisure centres indicated a lack of essential building energy management metrics and reporting structures, compounded by very poor data quality from energy suppliers. A document analysis, of a government grant scheme application process, showed inconsistencies with accepted investment appraisal criteria. In-depth interviews were then carried out with fourteen informed respondents in Co. Dublin guided by an 'energy management matrix' (EMM) method of qualitative assessment, as used by SEAI and the EPA. This research framework also guided coding and commenting of the transcribed interview data, assisting in its analysis and interpretation. The indicative results of this exploratory research were that policy implementation is only weakly consistent with EMM-defined good practice. Current policy targets appear to lack meaning due to poorly defined baselines, poor data gathering, an absence of energy reporting and a lack of operational level, results-driven programmes.

A more dominant policy of cost cutting and capital

rationing appears to be undermining value – limiting cost-optimal and robust local decision-making. Energy accounting was reported as being seriously impeded by poor billing from energy suppliers. In contrast, but within DCC, the Dublin Fire Brigade Green Plan, with core principles of behavioural change and carbon saving, has achieved significant results by linking operational and management commitment with technical and investment expertise. This research suggests it is a good-practice, robust alternative model, sustaining local services whilst also saving carbon emissions, energy and money.


Declaration I certify that this thesis which I now submit for examination for the award of an MSc. in Sustainable Development is entirely my own work and has not been taken from the work of others save and to the extent that such work has been cited and acknowledged within the text of my work. This thesis was prepared according to the regulations for postgraduate study by research of the Dublin Institute of Technology and has not been submitted in whole or in part for an award in any other Institute or University. The work reported on in this thesis conforms to the principles and requirements of the Institute's guidelines for ethics in research. The Institute has permission to keep, to lend or to copy this thesis in whole or in part, on condition that any such use of the material of the thesis be duly acknowledged.

Signature

______________________________ Candidate

______________ Date


Acknowledgements I would like to thank my supervisor Dr. Alan Gilmer for his most valuable guidance and encouragement during the year. My family, friends and classmates were very helpful, providing support, advice and comments, I am very grateful. Thanks to Jim Scheer for the much appreciated suggestions and corrections.

Thanks too, to Robert Wyse for the read-through

comments and the solve-the-world summits at the cafĂŠ. Additionally, I would like to thank all of those who made themselves available for interview. Particular thanks are due to the staff at Codema, the City of Dublin Energy Management Agency, for their assistance with my many questions. Any errors of reporting or interpretation that remain in this work are of course my own and in no way reflect on the work or views of those who gave their assistance to this research project.

Dedication Above all, my thanks go to Lizzie McDonnell, energy management expert and intrepid wild swimmer, for the unwavering encouragement, diligent editing and all round effort that made this year of study possible and enjoyable.


TABLE OF CONTENTS CHAPTER 1 INTRODUCTION

1

1.1 Policy and Governance Context

1

1.2 Research Context

2

1.3 Research Question

4

1.4 Research Framework Methodology, Aim and Objectives

4

CHAPTER 2 LITERATURE REVIEW

5

2.1 Sustainability in Energy and Carbon Emissions Policy

5

2.2 Energy Management

6

2.2.1 Building Energy Management Capacity

6

2.2.2 Responsibility for Energy Management

8

2.2.3 Assessing Quality in Energy Management – The EMM

10

2.2.4 Energy Management Standards and Indicators

12

2.2.5 Energy Accounting: Linking Cost, Consumption and Carbon

12

2.2.6 Energy Performance Certification of Buildings

13

2.3 Energy Saving and Retrofit Investment Decision-making

14

2.3.1 Saving Energy: Energy Conservation and Energy Efficiency

14

2.3.2 Funding Energy Efficiency and Retrofit Measures

15

2.3.3 Cost optimal Retrofit and Lifecycle Costing

17

2.3.4 Building retrofit: Active versus Passive Measures, and Co-benefits 19 2.3.5 Investment Data Quality and Relevance in Appraisal

20

2.3.6 Investment Appraisal Methods and Considerations

21

2.3.7 Lifecycle Investment: Global Risks and Local Implications

23

2.4 Energy Policy and Local Authority Implementation

24

2.4.1 Energy and Carbon Emission Policies and Targets

24

2.4.2 National and Local Governance in Ireland

29

2.4.3 Dublin City Council Energy Usage

30

2.4.4 Funding Local Authority Retrofit

31

2.5 The DCC and DFB Green Plan

33

2.6 Literature Review Conclusion

34

CHAPTER 3 RESEARCH METHODOLOGY 3.1 Research Methodology Outline

35 35  

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3.2 Research Strategy

35

3.3 Research Methods

36

3.3.1 Methodology for Leisure Centre Surveys

36

3.3.2 Methodology for Document Analysis

38

3.3.3 Methodology for In-depth Interviews

42

3.4 Limitations to the Research Strategy and Methods

48

CHAPTER 4 LEISURE CENTRE SURVEY

49

4.1 Observations and Findings: Leisure Centre Survey Report

49

4.2 Leisure Centre Area and Billing Data

52

4.3 Leisure Centre Energy Data Analysis

53

CHAPTER 5 DOCUMENT ANALYSIS

56

5.1 Findings: Analysis of Documents

56

5.1.1 Description of Application Form

56

5.1.2 Findings: Application Guide

58

5.2 Findings: Assess Proposal Data Quality and Relevance

60

5.3 Analysis: Comparing Appraisal Method Alternatives

61

CHAPTER 6 IN-DEPTH INTERVIEWS

67

6.1 Interview Findings: Data Location and Citation Format

67

6.2 Interview Findings: By Coded EMM category

67

6.2.1 Energy Policy (EP)

67

6.2.2 Energy Management Structure (MS)

69

6.2.3 Implementation and Motivation (IM)

72

6.2.4 Investment and Cost Analysis (CA)

82

6.2.5 Monitoring and Targeting (MT)

93

6.2.6 Data Provided by Energy Suppliers (PD)

98

6.2.7 Outcomes from Past Policy Implementation (OC) 6.3 Codings: Counts and Average Attainment Levels CHAPTER 7 DISCUSSION

100 107   108  

7.1 Leisure Centre Surveys

108

7.1.1 Survey Observations Discussion

108

7.1.2 Data Analysis and DEC Ratings

109

7.1.3 Survey Conclusions

110

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7.1.4 Limitations of the Leisure Centre Survey 7.2 Document Analysis

112 112  

7.2.1 Appropriate Investment Appraisal

112

7.2.2 Timescale, Data Accuracy and Relevance

113

7.2.3 Comparing Appraisal Methods

115

7.2.4 Limitations of the Document Analysis

116

7.3 In-Depth Interviews

117

7.3.1 Coding Analysis and Interview Limitations

117

7.3.2 Interview Discussion by EMM Category

118

8.1 Conclusions and Recommendations

134

8.1.1 Energy Policy

134

8.1.2 Management Structure

135

8.1.3 Implementation and Motivation

135

8.1.4 Cost Analysis and Investment

136

8.1.5 Monitoring and Targeting

137

8.1.6 Provider Data from Energy Suppliers

137

8.1.7 Outcomes

138

8.2 Recommendations for further research REFERENCES

139 140  

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VOLUME 2: APPENDICES LIST OF APPENDICES A.

Interview Codings and Comments: Method, Sorting and Details

B.

Interview Data, Comments and Codings

C.

Green Plan: Kilbarrack Fire Station. Initial Results Summary

D.

Leisure Centre Report: Cover and Conclusions

E.

Spreadsheet Calculator Developed for Assessment and Presentation of Retrofit Measures. Example for Lighting Retrofit of Ballymun Leisure Centre Car Park

F.

Therm Model Views Assessing Fabric Thermal Performance: Existing and Possible Retrofits of Coolock and Crumlin Swimming Pools

G.

Better Energy Workplaces 2012: Document Analysis

H.

Alternative SBEM Calculations for Crumlin Swimming Pool by Codema and Temborias (2012)

I.

Spreadsheet used in Comparison of Appraisals

J.

Work in Progress Presentation: Methodology and Results

K.

Dublin City Council Leisure Centres: Photographs

List of Events Attended to Support the Dissertation Research

iv


LIST OF TABLES Table 2.1 The Energy Management Matrix

11

Table 2.2 Financial and Energy Accounting Attainment Levels

13

Table 2.3 DCC Energy Costs 2010 and 2011

30

Table 3.1 Appraisal Methods, Definitions and Acceptance

41

Table 4.1 Leisure Centre Energy Data, Measured Area and DEC Rating

52

Table 5.1 Collated Sub-Project Descriptions and Data.

58

Table 5.2 Data Used in Appraisal Comparisons.

62

Table 6.1 Attainment Levels for EMM categories and Governance levels

107

LIST OF FIGURES Figure 2.1 Retrofit Decision-Making: Saving vs. Penalty for Doing Nothing

19

Figure 3.1 Interview Topics Derived from EMM categories.

45

Figure 3.2 Coding Frame for Interview Data Derived from Typical EMM

47

Figure 4.1 Total Energy Usage of DCC Leisure Centres

54

Figure 4.2 Energy Utilisation Index for DCC Leisure Centres

54

Figure 4.3 2010 and 2011 Total Energy Cost versus Energy Cost Index

55

Figure 5.1 Excerpt from BEW Application Showing Sub-Project 1 Details

57

Figure 5.2 Simple Payback in Years for the 16 Projects

62

Figure 5.3 Net Present Values for the 16 Projects

63

Figure 5.4 Profitability Indexes for the 16 Projects

63

Figure 5.5 Profitability Index versus Net Present Value for the 16 projects

64

Figure 5.6 Energy Cost after Retrofit Compared to Present Cost

64

Figure 5.7 Danish Appraisal Method Profitability Index

65

Figure 5.8 Comparison of Rankings by Different Appraisal Methods

66

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LIST OF ACRONYMS BCR

Benefit to Cost Ratio

BER

Building Energy Rating, an asset based EPC.

BEW

Better Energy Workplaces: A government-funded grant scheme

BMS

Building Management System

CBA

Cost Benefit Analysis

CHP

Combined Heat and Power

CIBSE

Chartered Institution of Building Services Engineers

CO2

Carbon dioxide

CO2e

Carbon dioxide equivalent

Codema

City of Dublin Energy Management Agency

DCC

Dublin City Council

DEC

Display Energy Certificate, an operational EPC

DCF

Discounted Cash Flow, accounting for the time value of money

DLRCC

DĂşn Laoghaire Rathdown County Council

DCENR

Department of Communications, Energy and Natural Resources

DECLG

Department of Environment, Communities and Local Government

ECER

Effective Cost of Energy after Retrofit

EMM

Energy Management Matrix

EPBD

Energy Performance of Buildings Directive 2002/91/EC

EPBD-R

Recast Energy Performance of Buildings Directive 2010/31/EU

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EPA

Environmental Protection Agency

EPC

Energy Performance Certificate or Energy Performance Contract

ESCo

Energy Saving Company

ESD

Energy Services Directive

ETS

Emissions Trading Scheme

EU

European Union

kW

kilowatt, measure of power being used

kWh

kilowatt hour, measure of energy used

FCC

Fingal County Council

GHG

Greenhouse Gas

GPRN

Gas Point Reference Number

GWh

gigawatt hour

IPMVP

International Performance Measurement and Verification Protocol

LCA

Life Cycle Analysis

LCC

Life Cycle Costing

M&V

Measurement and Verification

MPRN

Meter Point Reference Number

MS

Member State of the European Union

MWh

megawatt hour

NEAP

Non-domestic Energy Assessment Procedure

NEEAP

National Energy Efficiency Action Plan

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NPV

Net Present Value

O&M

Operations and Maintenance

OPW

Office of Public Works

pc

personal communication

PE

Primary Energy

PPP

Public Private Partnership

PV

Photovoltaic

SBEM

Simplified Building Energy Model used for NEAP assessments

SDCC

South Dublin County Council

SEAI

Sustainable Energy Authority of Ireland

SEAP

Sustainable Energy Action Plan

NOTES 1. 'Carbon emissions': The predominant greenhouse gas (GHG) is carbon dioxide. Often both CO2 and GHGs are described as 'carbon emissions'. Total amounts of 'carbon emissions' or GHGs emitted are most commonly stated as carbon dioxide equivalent (CO2e) to include all GHGs. 2. Carbon vs carbon dioxide: The mass of carbon emitted is related to, but not the same as carbon dioxide emitted. 1 tC = 3.67 tCO2. 3. Power and energy are not the same. Energy use is the capacity to do work, commonly measured in joules (a very small amount of energy), or in kWh, MWh etc, for larger amounts. Power is the rate of energy being used at any one instant in time as measured in W, kW, MW, GW etc. viii


CHAPTER 1 INTRODUCTION 1.1 Policy and Governance Context Until recently, for large energy users like the public sector, energy costs were relatively minor compared to other overheads and there were few questions regarding future availability or the environmental consequences of energy use (Russell, 2010:78). These factors are now changing rapidly for all energy users, including the public sector in Ireland that has an energy bill of approximately ₏500 million every year, of which local authorities spend more than a fifth (SEAI, 2012d). National policy, in line with EU directives, sets out clear headline targets: a legally binding requirement to reduce total carbon emissions by 20% by 2020 relative to 1990 levels and a non-binding aim of decreasing energy use by 20% by 2020 (da Graça Carvalho, 2012). The National Energy Efficiency Action Plan (NEEAP) stresses the need for increased energy efficiency in buildings, through good energy management and extensive retrofit, and directs the public sector to play an exemplar role with a target of reducing its energy use by 33%. Both Dublin City and South Dublin County Council have also signed the Covenant of Mayors in 2009 committing them to an overall reduction of 20% in carbon emissions by 2020. Over the past five years, energy costs have increased rapidly, there are now multiple possible suppliers increasing complexity for purchasers, and many doubts are expressed over the future certain continuity of supply as well as the potential for serious price shocks ahead. Passing the point of global geologic peak oil production in 2006 (IEA, 2011b) is unlikely to reduce carbon emissions significantly (Verbruggen and Al Marchohi, 2010), but does means that energy prices are likely to rise rapidly in the

1


medium term (Benes et al., 2012) though large fluctuations are likely, potentially presenting serious economic problems (de Almeida and Silva, 2009). The burning of fossil fuels for energy, thereby producing greenhouse gases contributing to global warming (IPCC, 2007; Metz, 2010:27) has also become a major concern for many citizens and governments. Decisions regarding the energy management and retrofit investment of existing public buildings and social housing are critical in affecting short, medium and long term costs in money, energy and carbon emissions. Economic, social and environmental sustainability and security must increasingly be seen in combination if effective policy is to result in cost-effective and risk-robust decision-making. For all of these reasons, addressing current and future energy usage in buildings, lighting and water services is becoming increasingly important to local authorities. Following the financial crisis, the increasing cost of energy, combined with budgetary constraints, may mean the difference between maintaining and losing services. This is likely to mean balancing short-term savings with well-directed investment, to ensure long-term value by making resilient as well as cost-optimal decisions.

1.2 Research Context This research examines government commitment to stated energy policy in the public sector, and the progress being made in fulfilling its exemplary role, by undertaking a qualitative assessment of energy management and retrofit investment practices in Dublin local authorities, and those of national funding departments and agencies as they affect the local authorities. What are current energy management practices within local authorities and are they consistent with minimising future operational costs in public buildings and

2


housing, as intended by energy and emissions reduction policies? The only published research appears to be the 2011 CCMA Local Authority Energy Management Survey (SEAI, 2011c), a basic questionnaire survey, and Energy Use in the Public Sector (SEAI, 2012h), both published in Summer 2012, as this research was completed. The 2008 Climate Change Strategy for Dublin City (DCC/Codema, 2008) and the 2010 Dublin City Sustainable Energy Action Plan (DCC/Codema, 2010b) describe past energy usage and emissions, proposed actions and targets, and future scenarios, but do not describe existing practices and attitudes to energy management as they relate to policy implementation. No detailed specific literature on Dublin or Irish local authority energy management and retrofit planning was found in literature searches. Literature on good practice for assessing large, private sector, energy users' energy management performance is readily found (see Section 2.4 and 2.6). A common method used in Europe and North America is the qualitative assessment based on an energy management matrix (EMM) approach. A variant of this is EMM auditing used by the Environmental Protection Agency for Integrated Pollution Prevention Control energy efficiency auditing, also recommended by SEAI for use in the Large Industry Energy Network (LIEN) programme (EPA, 2003; Wajer, 2005).

As large local

authorities are significant energy users it was deemed appropriate to use this as a framework in assessing current, local authority energy management practice. An EMM was therefore the basic framework guiding the methodology and analysis for this research.

3


1.3 Research Question The question that this research seeks to address is: Are national energy saving and carbon emissions reduction policies for the public sector, and their implementation by local authorities in Dublin, consistent with good practice in energy management and retrofit investment decision-making?

1.4 Research Framework Methodology, Aim and Objectives This original, exploratory research made use of the existing, qualitative Energy Management Matrix auditing technique as a guiding framework for the assessment of current, local authority level energy management, particularly in regard to public buildings and social housing. Following a review of literature, detailing good practice in energy management and retrofit investment, the research aim was to gather data that would qualitatively gauge: •

how local authorities are undertaking energy management;

•

how retrofit investment in local authority buildings and housing is appraised; and,

•

how local authorities are being supported and directed by central government to meet the energy and emissions targets of stated policies.

4


CHAPTER 2 LITERATURE REVIEW 2.1 Sustainability in Energy and Carbon Emissions Policy The future of public goods, such as water supply, public lighting and buildings (leisure centres, libraries and fire stations), and the easing of fuel poverty are reliant on national and local government decisions prioritising long-term value in the face of short-term pressures and longer term uncertainty (Lane, 2011; see also local implications in, Trainer, 1999:52-58). These objectives echo the Our Common Future, the 'Brundtland Report' of (UN-WCED, 1997), which identified maintaining intergenerational equity in access to resources and progress toward the elimination of poverty as key aims of sustainable development. The report also stated the need for affluent societies and citizens to make choices toward reducing their demands on ecological supports including energy, to avoid an "interlocking crisis" of economics, society and the environment, particularly due to global warming, increasing world population and the end of an era of cheap energy (Para. 27-30). Today these risks are becoming more apparent, yet only weak policy changes have been made (IEA, 2011b; IIASA, 2012) and the European and Irish economies continue to depend on energy inputs from imported fossil fuels with large resultant greenhouse gas emissions (IEA, 2008; SEAI, 2011b). In spite of the Kyoto agreement and European emissions regulations, which only address domestic emissions, effectively no progress had been made at all in reducing global climate emissions, largely because of a lack of political will to reduce consumption, particularly from OECD governments and voters (Helm, 2008). Towards a New National Climate Policy (NESC, 2012), the National Climate Policy Review 2011 (DECLG, 2011:18) and the Our Sustainable Future (DECLG, 2012b:27) indicate that maintaining the status-quo is

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not an option.

However, these documents generally fail to acknowledge the

increasingly inconvenient evidence of climate change (Anderson and Bows, 2010; New et al., 2010; Huntingford et al., 2012) thereby degrading the quality and value of national policy and long-term decision-making in Ireland. Currently, energy and emissions are effectively only rationed by cost, even though a sufficiency strategy of carbon budgeting (Alcott, 2008; Brand and Boardman, 2008) may ultimately be the only effective way to limit total carbon emissions to avoid dangerous climate change, though time is now running out rapidly (Anderson, 2011; ICC, 2009).

2.2 Energy Management Energy management is "the judicious and effective use of energy" requiring a whole systems viewpoint to optimise and examine all current and planned energy usage (Capehart et al., 2005:1). 2.2.1 Building Energy Management Capacity The linkage of costly energy use and resultant carbon emissions with economic wealth, societal health, energy security, and climate change, given the increasingly high potential for future shocks, provides a strong impetus for considering future energy usage carefully (ibid.:3-5). Energy costs rose dramatically in the 1970s and there was a corresponding increase in energy management, but this fell away in the 1990s and early 2000s such that many organisations now lack capacity to make financially, or technically, well-informed energy decisions (Fawkes, 2007:41). With prices rising rapidly in recent years and, generally, likely to continue rising (Fig 11, Benes et al., 2012), especially relative to public sector funding, energy users such as local authorities have three possible responses: do nothing; carry out only cost 6


saving proposals; or respond with strategic energy management by aiming to minimise overall energy cost and exposure to risk during the next decades (Fawkes, 2007:3). As cost saving, resilience and policy demand, this requires organisational and societal change to reinvest effort and funding into energy management (Beggs, 2009:3-4), and to overcome ‘behavioural lock-in’ in energy consumption habits (Maréchal, 2010; Jackson, 2005:133). Montier (2009 Ch. 14;) details research indicating that value investors must have long-term time horizons, but behavioural economics suggests that decision-makers commonly suffer from serious loss aversion and a bias toward short-term rewards, discouraging longer term investments that are most likely to produce long term value, even if otherwise persuasive information is presented.

These behaviours apply

particularly with respect to policy decision-making in the face of climate change (McNall, 2010). In the UK, local authorities believe that the short-term budget cycles required of them by central government inhibit long-term decision-making (Lorenzoni, 2000:181, cited by Urwin and Jordan, 2008:181) and yet public buildings are likely to be required indefinitely, mandating long lifecycle criteria in judging retrofit or replacement (Ruegg and Short, 2007:3.22). Decision-making is often difficult because of future uncertainty (Hallegatte et al., 2012:2-9), conflicting objectives, too many or too few proposed alternatives, and unsupported biases (Eisenführ et al., 2010, Ch. 1). To diminish bias and increase value, rational decision-making can be used giving a structured process to produce improved outcomes by breaking down complex problems into component parts (ibid., Ch. 1). No decision-making method or decision is objectively correct (Triantaphyllou, 1997), but defining parameters for data quality, key objectives and stakeholder preferences at the

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start of the process filters out short-term motivations that might otherwise overly effect unstructured decision making (Eisenführ et al., 2010:2-4). 2.2.2 Responsibility for Energy Management First and foremost, energy management is an issue that needs to be treated as a management responsibility (Fawkes, 2007:33). Capehart et al. (2005:1) identify ongoing commitment from upper management in an organisation as the key ingredient in successful implementation of an energy management program, an assessment agreed with by Russell (2010:59-63). Any organisation that expects to make actual reductions in energy waste needs to commit all managers to on-going, results-based organisational change by setting energy goals and accountabilities (ibid.:52-54). Frequently cited business research also concludes that successful change programmes emphasise results, particularly from an on-going succession of short-term measurable projects. Such programmes involve empirical testing to reveal what works on-site, combined with frequent reinforcement and a strong management commitment to monitoring and reporting results (Kaplan and Norton, 1992). In contrast, ‘activitybased’ ‘quality programmes’ or ‘campaigns of programmatic change’ commonly fail because they are not judged by verifiable results, they are too large scale and diffuse in effects, or they are designed by staff specialists or external experts rather than operating-level managers who can trial and test for results against accurate monitoring (Schaffer and Thomson, 1992).

Enduring organisational change most effectively

evolves at the periphery of organisations (not by ‘top-down’ direction), primarily by changing behaviour and habits, rather than attitudes or ideas, and is best motivated by new and clearly identified roles, responsibilities and relationships (Beer et al., 1990).

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Poor energy policy treats energy management as a series of engineer-driven, fast payback, capital investment projects, whereas good policy is a continuous management process of communication involving all employees in deriving value from a mix of continuous awareness and attention to detail, as with any other financial portfolio, (Russell, 2010:85-87). Capehart et al. (2005) describes six critical energy management objectives, illustrating the need for managers and staff to take responsibility for energy saving. Four of the key objectives critical to energy management are purely managerial skills and remain the responsibility of all managers: • Cultivate good communications on energy management; • Develop and maintain coherent monitoring and reporting management protocols to use energy wisely; • Continuous behavioural improvement to increase returns from energy investments; • Develop an interest in and dedication to the energy management program from all employees. Two are more technical: the need to improve energy conservation and efficiency, and reducing impacts of supply interruption (ibid., Ch. 1).

Many lessons in good

communication to improve energy efficiency through past marketing efforts are clearly described in a report by LBNL (2010). Technical aspects of energy management do require expertise to inform facility management and decision-making, but it is clear that the responsibility for energy management lies with management, not with agencies or consultants (Fawkes, 2007:4655). To solve energy cost problems, a programme of sustained, ‘continuous energy

9


improvement’ is required, including both behavioural measures and capital projects, planned so that early, easy stages guarantee savings that can are reinvested in longer term but high net value investments (Russell, 2010:91). 2.2.3 Assessing Quality in Energy Management – The EMM Fawkes (2007:42-63) sets out basic activities and enabling tools useful for every type of organisation, public sector or private sector, large or small, to focus on the objective of achieving maximum cost, energy and carbon savings. Similarly Russell (2010) describes assessment of an organisation's energy performance using clearly managerial categories and questions: • Organisational Policy: How well does the organisation articulate its energy vision and goals? • Management Structure: Is there clear authority and accountability for energyrelated decisions? • Implementation and motivation:

Is energy policy integrated with standard

operating procedures? • Investment analysis: Are the right criteria used to reach conclusions about energy and money? • Monitoring and targeting:

Is there a way to measure and react to energy

performance? (ibid.:118) Typically, these are the headings used in the EMM method, qualitatively assessing the current performance level in each of these dimensions, often using a zero up to 4-star scale (see Table 2.1). This tool is used to examine where an organisation is now and to identify how it needs to progress its energy management abilities. Widespread use of the EMM for assessment of organisations and industrial sites is

10


noted in references from North America (US-EPA, 2012), Britain (Fig. 3, Carbon Trust, 2011; Fawkes, 2007:56), as well as Ireland (EPA, 2003:16; Wajer, 2005). Table 2.1 The Energy Management Matrix Collated from Table 5.3, pp.119-120, Russell, 2010

11


2.2.4 Energy Management Standards and Indicators The new ISO 50001, replacing IS EN 16001, is a worldwide standard for energy management in use that enables third-party auditing and quality registration of energy management, establishing energy baselines and Energy Performance Indicators (NSAI, 2012). University College Cork has recently achieved this accreditation (UCC, 2012). In Ireland, the Sustainable Energy Authority of Ireland (SEA) have developed Energy MAP, a management action plan for small and medium energy users including local authorities (SEAI, 2012f). Quantitative performance indicators are required to enable organisations, local authorities for example, to compare dispersed buildings of similar type (Moss, 2005, Ch. 6). Moss notes the need for carbon dioxide emission benchmarks and indices (CDIs). Capehart et al. (2005:26-29) identify critical performance indicators needed for on-going analysis of energy use in buildings as total energy cost and consumption, as well as cost divided by area (Energy Cost Index, ECI) and consumption divided by area (Energy Utilisation Index, EUI). 2.2.5 Energy Accounting: Linking Cost, Consumption and Carbon Linking energy costs, energy consumption and carbon emissions is a critical part of energy monitoring, requiring accurate energy reporting to be coordinated with financial accounting. Both sets of data can then be jointly subject to analysis thereby informing policy and management decisions (ibid.:25). Progress toward coordinated energy accounting can be described in qualitative attainment levels, see Table 2.2, that complements and further adds to the EMM qualitative assessment of the Monitoring and Targeting category (ibid., Ch.1). Energy accounting also supports the Investment Analysis category.

12


Table 2.2 Financial and Energy Accounting Attainment Levels

From Capehart.:25)

Billing data is critical to energy accounting and for establishing baseline energy use. Fawkes (2007:39-40) notes that in the UK billing by utility companies has been “atrocious”, with a very low standard that would be unacceptable in any other industry, and which may be a left over from “take it or leave it” billing from nationalised utilities. 2.2.6 Energy Performance Certification of Buildings Energy Performance Certificates (EPCs) for buildings have become an effective reference basis for building energy use and improvements in Europe and worldwide (Bull et al., 2012; Laustsen, 2008; Yan-ping et al., 2009). Buildings in their design, fabric and technical equipment can perform at a theoretical level of energy performance, an 'asset-based' rating. In Ireland, the asset-based EPCs are the Building Energy Rating (BER) for dwellings and the NBER for non-domestic buildings. Qualified assessors produce these by inputting a building’s details into modelling software thereby calculating its energy performance (SEAI, 2012e). However, a building and its technology are operated by people, often many people, introducing a multitude of additional variables into the systems operation and dramatically increasing potential risk of energy waste due to behaviour (Masoso and Grobler, 2010). To give a building an 'operational' EPC, that will show how an a occupied building is actually performing in practice, a straightforward method is to sum 13


the total energy inputs for a building for a year, as evidenced by the energy bills, divided by the measured floor area (SEAI, 2009a:8). In Ireland, the benchmarked operational EPC is called a Display Energy Certificate, an A (good) to G (bad) rating system that is renewed annually. Since 2009, all buildings open to the public over 1000 m² in size, including public buildings, are legally required to display this certificate. Under the revised Energy Performance of Buildings Directive (EPBD-R), this will apply to all buildings over 250 m² from July 2015 (European Union, 2010).

2.3 Energy Saving and Retrofit Investment Decision-making 2.3.1 Saving Energy: Energy Conservation and Energy Efficiency To reduce demand, measures need to be taken to save energy, by energy efficiency or energy conservation, or both (SEAI, 2008). Energy efficiency enables a result to be achieved with less energy than is currently used, whereas energy conservation is a reduction in energy usage made simply by the decision to avoid consuming it (SEAI, 2009b:7). Energy saving usually results in cost saving but if the saved monies are spent on energy use, through consumption of any kind, a rebound effect occurs reducing the overall saving, either locally (direct rebound) or more globally (indirect rebound). As cost, energy use and carbon emissions are strongly related, similar rebound effects affect each of them. There is great disagreement in the literature regarding the extent of these effects, some saying they largely cancel out the efficiency gained (Herring and Sorrell, 2009; Alcott, 2008) and some disagreeing strongly (Lovins and Lovins, 1997; Ryan and Campbell, 2012:24). Saving energy can cost less than buying energy, an ‘energy efficiency gap’ that potentially widens when fuel prices rise rapidly and efficiency costs fall (Lovins and Lovins, 1997:i). However, there are often serious barriers in organisations, information

14


and markets that prevent investment in improved energy management and capital projects to limit commitment to future energy usage (Brown, 2001).

Allcott and

Greenstone (2012) temper this by finding that the ‘energy efficiency gap’ may not be as large as engineering-accounting studies suggest. Nonetheless, providing sustainable, secure energy management structures requires investment and control over both energy supply and demand Denny and O'Hagan (2011:272). 2.3.2 Funding Energy Efficiency and Retrofit Measures Financing barriers to funding energy efficiency include: non-availability of funds; poor information; project scale and development costs; weak risk assessment and management; and a lack of technical or investment knowledge and capacity (Fig. 1, IEA, 2011a). Energy Saving Companies (ESCos) guarantee performance levels and cost savings in Energy Performance Contracts (EPCs) agreed with energy users. They carry out retrofit and other measures, and take on the risk of achieving energy savings (SEAI, 2012a). In return they receive payments over the life of the contract and these may be related to independent measurement and verification (M&V). ESCos can be privately or publicly run. Local authorities may be wary of transferring risk to private companies, given their experience of Public Private Partnership (PPP) failures in regeneration work (Punch, 2009:23-26), outcomes which are not untypical of PPP performance worldwide, despite their political popularity (Hodge and Greve, 2009). As with PPPs, the public and private partners to EPCs have divergent goals, so local authorities need expertise to avoid poor outcomes, due to high transaction costs and knowledge imbalances (Vining and Boardman, 2008; SEAI, 2012a:18).

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The logic of rebound and consumption-caused emissions suggests that governments need to ring-fence revenues from carbon taxes and efficiency savings toward further spending on carbon-saving efficiency savings, if they are serious about cutting carbon emissions and sustaining intergenerational equity (Helm, 2008). Nevertheless, ring-fencing, the reallocation of specific government tax or savings revenues to specific purposes (also known as Pigouvian taxes, hypothecation or earmarking) may not be popular with governments because they typically want flexibility to spend revenues as they see fit (Spackman, 1997). However, voters can support ringfencing more readily if the environmental benefits are made clear (Sælen and Kallbekken, 2011). Evidence from efficiency programmes in the USA shows that ringfencing at least a large percentage of eco-tax revenues and efficiency-related savings to fund on-going sustainable development measures greatly increases the effect of interventions (Cowart, 2011). A portfolio of policies is critical: efficiency labelling and performance standards; auctions of allowances (as in the EU Emissions Trading Scheme); and a large portion of carbon tax revenues re-directed back into efficiency measures (Boardman, 2004). With respect to buildings Cowart (2009) finds that piecemeal approaches make no sense; whole buildings need system-upgrades rather than making a series of small-scale steps. Based on actual figures from past programmes, revenue reinvestment programmes that ring-fence savings toward energy efficiency can save at least seven times more carbon per consumer unit cost than carbon taxes alone (ibid.). A finance mechanism in line with this ‘cap and invest’ strategy’ is the ‘revolving fund’ that begins with an initial investment and requires that returns on the investment go back into the fund to further investment, as in the Thailand Energy Efficiency Revolving Fund (IEA, 2011a:55-59)

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and the Revolving Green Fund, ‘invest-to-save’ funding of university energy efficiency in England (UK Government, 2008:31). 2.3.3 Cost optimal Retrofit and Lifecycle Costing Though necessary for society and human wellbeing, both new-build and existing buildings are expensive to build or retrofit, and costly to operate over their lifespan, due to maintenance and fuel costs (McNicholl and Lewis, 1996; Verbruggen, 2012). Therefore, when committing to a long-term investment such as new build or retrofit it is financially and logically prudent to consider ‘whole-life’ costs, benefits and risks. Deep retrofit of existing buildings is most economically feasible when significant renovation is undertaken due to major repairs or refitting, typically every 30-40 years (Laustsen, 2008:8). The Department of Finance also state that whole life costs are very important in costing a design, specifying a 20-50 year study period in the Capital Works Management Framework (DoF, 2009:55), as demonstrated in a worked example for a school in Dublin by Kehily and Hore (2012). The EPBD-R directs Member States (MS) to ensure that major renovations include 'cost optimal level' energy performance upgrades to building elements or to whole buildings undergoing significant renovation, with the MS definitions of cost optimal to be submitted and approved by January 2013 (Article 7, European Union, 2010; EU, 2010). 'Cost optimal level' means the lowest sum total of energy-related investment, maintenance, operating, and disposal costs over the remaining economic lifecycle of the building or building element as defined by the MS (Articles 3-5, European Union, 2010; EC-EEE, 2012). The aim of the EPBD-R is to ensure that investment appraisals of retrofits are made on the basis of lifecycle costing comparing alternative sets of retrofit measures (Aggerholm et al., 2011 Section 3).

Functional long-lasting buildings are more

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sustainable if they minimise their total life cycle environmental cost and maximise the physical and social wellbeing of those who use them (Buys et al., 2011). Life cycle assessment (LCA) includes all potential environmental effects whereas life cycle costing (LCC) looks only at the financial costs, but both should include some estimate of externalities, whether positive or negative (Norris, 2001). Caplehorn (2012) observes that Whole Life Costing is highly desirable for sustainability and long-term value but it is frequently not done because it is time consuming or complex. Certainly, the International Standard for LCC does evince complication (ISO, 2008). However, in the USA, all federal government departments and facilities assessing new build or retrofit energy efficiency measures are required to take decisions based on lifecycle data and appraisal methods to demonstrate long-term cost-effectiveness and value for money (Capehart et al., 2005:151). Typically, the US government uses a study period of 25 years (Fuller, 2005). As noted in Section 2.3.6, in Denmark, a highly simplified LCC is used in building retrofit assessments potentially enhancing effectiveness of policy through ease of use. Texts for facility managers discuss Whole Life Costing and financial analysis in budgeting and procurement to reduce future operating and maintenance costs (Bottom, 2006:212-217; Moss, 2005:118-119).

Lifecycle approaches are found to be most

effective in assessing, designing and implementing retrofit actions as part of a rational decision-making method for retrofit investment (Ardente et al., 2011). Lifecycle appraisals are good practice and can be applied to all 'energy at risk' calculations for energy management of future energy use (Russell, 2010: Ch. 6). For all existing buildings there is a commitment to continue to use energy over the entire lifecycle of the building. On analysis the current commitment to annual total energy use can be divided into three parts (Figure 2.1): first, committed energy expenditure that 18


economically cannot be saved; second, ‘energy-at-risk’ which can be economically saved (comprised of the annualised project costs of all profitable retrofits); and third, an annual amount comprising either, the savings due to the profitable retrofits and behavioural measures, or, if the retrofits are not done, the annualised cost of doing nothing – a penalty often not considered by decision-makers (ibid.:134-136).

Figure 2.1 Retrofit Decision-Making: Saving vs. Penalty for Doing Nothing Redrawn from Figure 6.4, Russell, 2010, with added text referencing Ibid. p.134-136

Investments in energy-smart behavioural practices are highly effective in offsetting the risks involved in capital retrofit projects (ibid.:87). Where possible, staging retrofit investments may be the best option in the face of uncertainty (Menassa, 2011), a finding that may be important for appraisals by capital poor local authorities. 2.3.4 Building retrofit: Active versus Passive Measures, and Co-benefits Verbruggen et al. (2011) show that the long-term commitment, the ‘irrevocability’ consequent from new build or long-term retrofit decisions should be accounted for in LCC, a finding in favour of ‘fabric-first’, passive retrofit measures rather than active technology measures that are at higher risk of premature failure (also found by Verbeeck and Hens, 2005). Importantly, in a series of papers Little (2011) shows that some passive measures such as retrofit internal insulation can lead to 19


increased risks of mould and condensation, as well as limited thermal benefit. Generally, well detailed external insulation entails far less risk producing a more thermally effective retrofit, in line with the ideal build-up in terms of building physics, with insulation to the outside of structure, keeping it warmer and dryer (Lstiburek, 2007).

Upgrading air tightness or uneven insulation can increase condensation

problems so it is essential to improve ventilation control at the same time (Brown et al., 2010:8). The uncosted co-benefits of health and productivity in corporate building retrofits have been shown to be substantial though they are frequently ignored in assessments (Yudelson, 2010). Un-costed co-benefits, such as health due to improved comfort levels should be included in appraisals even if only conservative estimates are made Ryan and Campbell (2012:26-29). A cost benefit analysis of a large-scale, building energy efficiency, upgrade programme for dwellings in Ireland, found a Benefit Cost Ratio (BCR) of 3.0 with energy efficiency making up 57% of the positive return, health 25%, comfort 10% and emissions reductions 8% (Clinch and Healy, 2000). 2.3.5 Investment Data Quality and Relevance in Appraisal Before an investment appraisal can begin it is critical that the decision-making costs and benefits data be thoroughly checked for inaccuracies that might affect the results; the appraisal process is only as good as the data used – good quality data often takes time and money to obtain (Holmes, 1998:7). A crucial check is to ensure that any cash flows or savings from the investment are attributable only to the proposed investment’s commencement (ibid.). Multiple retrofit measures for a building can have interactive effects if all adopted, so no double counting of savings is allowed in the investment appraisal (Chidiac et al., 2011). For larger investments it can be advisable

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to carry out both: a financial assessment, with a sensitivity analysis to look quantitatively at the effects of possible cost or interest rate changes; and a risk assessment to examine the robustness of the proposal relative to future uncertainties, be they an inherent potential for technological failure, or in respect to external effects like health or ‘deep uncertainties’ like climate change (SEI, 2004; Hallegatte et al., 2012). It can be difficult to accurately estimate the projected cost or consumption savings returns on energy efficiency, or verify them after installation, so good baseline data (adjusted for weather effects) for the building both for the appraisals and after retrofit is important (Aggerholm et al., 2011:9-10). The process of assessing and confirming efficiency savings is known as Measurement and Verification (M&V), a critical part of energy management that may reveal pronounced differences between predicted and actual energy savings (Fawkes, 2007:56). Behavioural and occupancy rebound effects can significantly reduce energy savings (Scheer et al., 2012; see also, Hong et al., 2006). 2.3.6 Investment Appraisal Methods and Considerations Bandy (2011:140) notes that public sector investments are ‘paid back’ by the value of public good that they create.

To assess investment proposals, appraisal

methods are used to assess the investment quality, to rank them in order of the return they provide and to give a yes/no answer as to whether they are likely to be profitable given the input parameters (Holmes, 1998). Simple payback gives an approximate measure of a project's worth by dividing the installation cost by the predicted annual savings giving the number of years it would take for an investment to payback (SEI, 2004:34). Use of simple payback is generally not advised for assessing energy saving measures because it ignores the time value of

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money and it also ignores the costs or benefits that accrue after the investment period (Holmes, 1998:29). Other problems are that its use can build in a bias toward shortpayback riskier projects and many projects that could increase wealth are rejected (Ibid.). In spite of this Investing in Energy SEI (2004:30-48) discusses both simple payback and DCF methods but does not state a preference, though remarking that lower risk, longer life investments should be given a longer time to payback (Ch. 4). Energy management and investment appraisal references are generally critical of using the simple payback method of cost analysis and strongly encourage the use of discounted cash flow (DCF) analyses such as Net Present Value (NPV) or Internal Rate of Return, IRR (Capehart et al., 2005; Kreith and Goswami, 2007; Holmes, 1998). NPV is preferred for project appraisal by the EU (EC, 2012b), and the Department of Finance (DoF, 2009). DCF methods, such as NPV, allow for the time value of money by including a discount rate, related to the rates at which finance is available and organisation preferences, and an escalation rate, such as a forecast inflation rate in the price of energy (Kehily, 2012). Typically, a positive NPV signifies a worthwhile investment (Koetse et al.:176). If a building owner is constrained from carrying out positive NPV projects because of an inability to raise funds (capital rationing) this amounts to market failure (Holmes, 1998:106).

Either the market needs better information or the owner is making a

decision that it does not want to take on debt, even if the positive NPV suggests that the debt can be covered without problem (ibid., Ch. 8). However, Montier (2009:47-55) notes that DCF methods can also have problems, by leading to mistaken confidence when it is not possible to accurately predict the future, and recommends an annualising method of gauging 'earning power’. Russell (2010:134-136) uses a similar method in annualising the DCF retrofit cost giving an 22


annualised profitability index, that has the advantage of directly comparing current fuel cost with the effective fuel cost after retrofit. Benefit to Cost Ratio (BCR) also known as Profitability Index (PI), simply dividing the benefits by the costs, whether discounted or not, is a method recommended by financial management texts as giving a measure of the relative amount of return (Helfert, 2002:264). In cases of capital rationing the aim of an investor is to maximise the return (NPV) that the available capital can generate, so ranking alternative proposals by BCR enables decision-makers to choose all the highest BCR proposals with total investment costs that sum to the available amount of capital (Holmes, 1998:109). In Denmark, a modified, non-discounted form of BCR is used for its simplicity (Aggerholm, 2009).

In looking at retrofit measures particularly at major renovation,

differing lifetimes are specified for different types of measure – for example, for insulation forty years and for lighting twenty years. By defining a definite ‘profitability threshold’, stating that if a measure delivers a profit of more than 33% over its lifetime then “It is required to implement the measure”, the Danish rules simplify policy and application (Aggerholm, 2011). 2.3.7 Lifecycle Investment: Global Risks and Local Implications Unsustainable global trends (Drexhage and Murphy, 2012:19) need to be considered, even by local decision-makers, if appraising the values of multi-decadal investments like building retrofit or replacement alternatives in the face of uncertainty (Bulkeley and Betsill, 2005). Two major concerns for the next three decades, a typical lifecycle for buildings, are global warming and peak oil. Local decision-making that accounts for high potential uncertainties through planned local management and

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resilience policies has been shown to increase the robustness and cost-effectiveness of infrastructure decisions (Hallegatte et al., 2012:34).

2.4 Energy Policy and Local Authority Implementation As discussed above in Sections 2.2 and 2.3, good practice in energy management requires clearly stated policy, management involvement in implementation, energy accounting and investment appraisal, monitoring and reporting, and on-going assessment of outcomes (the order of the EMM in Table 1.1). Noting the relationship to other governance levels, these themes are discussed in this order below as they relate to local authority energy management and retrofit investment, particularly in Co. Dublin. 2.4.1 Energy and Carbon Emission Policies and Targets 2.4.1.1 European Energy and Climate Policy Although domestic (not 'total') carbon emissions is one of the three 2020 policy targets Wood (2010) contends that the emphasis of the European Union has been on maintaining energy security by securing fossil fuel supplies, increasing renewable energy, and reducing consumption. This combination led to the EU’s Climate and Energy Package (EC, 2012a) with the so-called 20:20:20 by 2020 targets (da Graça Carvalho, 2012): aiming to reduce domestic GHG emissions by 20% from 1990 levels; to supply 20% of energy needs from renewables; and to reduce energy consumption by 20% by increasing energy efficiency (Nugent, 2010:345). Already by 2009, it was clear that the non-binding energy efficiency target would not be met, mainly due to diminishing political will (with Member States distracted by the Euro crisis) and financial commitment to the required capital investments in changed circumstances (da Graça Carvalho, 2012:21). The recently approved Energy Efficiency Directive (EED) will now replace the Energy Services Directive (ESD) but 24


the 20% target has become a 17% target and remains non-binding. The expectation is in fact of 15% savings by 2020, and only central government, not local authority, buildings are included in the new 3% annual renovation rate (Euractiv.com, 2012; Rabitte, 2012). The EED does introduce an obligation of 1.5% of energy sales on energy suppliers, requiring them to invest that amount in energy efficiency measures for customers (Rabitte, 2012). Although they use less energy than water and public lighting, buildings are a significant cost for local authorities (SEAI, 2011c, p.6;). Improved energy management and retrofit upgrading of existing buildings have repeatedly been identified by governments and experts, including those in the EU and Ireland, as cost effective, high priority measures for reducing carbon emissions and increasing energy efficiency (DCENR, 2009). However, despite the claimed benefits and strongly stated policies, achieving actual savings has been slow and the savings obtained are often less than those targeted as the drive for a new Energy Efficiency Directive has shown (EC, 2012c:1). 2.4.1.2 Energy and Climate Policy in Ireland Ireland has clear headline policy targets regarding carbon dioxide emissions and energy use in the public sector, to which local authorities are also bound as stated in the Climate Policy (DECLG, 2011) and the National Energy Efficiency Action Plan (DCENR, 2009). The NEEAP describes investing in energy efficiency as imperative and Government has identified the need for the public sector to lead by example. It has therefore been given a target of reducing energy use by 33% by 2020 (ibid.:22-28). Public sector energy use, of about 6,920 GWh in 2007, has in the past only been calculated as a estimated ‘residual’, the remainder after subtracting industrial, residential and transport usage from the total national energy supplied (ibid.:49). 25


Dublin has signed The Covenant of Mayors, an international agreement linking cities committing signatories to reducing their city’s carbon emissions by at least 20% before 2020 (Codema, 2009). However, none of the targets in any of these documents are disaggregated in any way among public sector bodies so that differentiated budget targets are set corresponding to differing potential attainment levels. They also lack penalties for non-achievement weakening their effectiveness. Only the Climate Policy has legally enforceable penalties by way of ‘flexible measures’ or carbon credits, credits that will be needed to enable Ireland to meet the EU target (NESC, 2012:37). Approximately 20% of non-ETS related emissions in Ireland stem from buildingrelated emissions, a considerable proportion though less, due to high agricultural and transport emissions, than the 40% figure found in Europe generally (BPIE, 2011, p.19;). Irish government departments in these areas are endeavouring to ensure that their sectors do not have to bear the burden of the emissions reductions that are planned, as evidenced by recent presentations by their officials (IIEA, 2012) 2.4.1.3 Public Sector – Policies, Programmes and Targets The exemplar role of the public sector in achieving improved energy efficiency under the Energy Services Directive is restated in the recently published Energy Use in the Public Sector (SEAI, 2012h), which provides many details that were previously unpublished. The policy drivers for energy efficiency are EU legislation (ESD to be replaced by the EED, and the EPBD-R) and national initiatives including transposing the directives and energy efficient and green public procurement. The SEAI’s public sector programme has four key elements: partnership agreements to engage with top level managers; best practice exchange between public bodies at all levels and internationally; building new funding and procurement models;

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and much improved monitoring and reporting.

The document urges public sector

bodies to engage with SEAI through basic, full and exemplar energy management programmes including SEAI’s Energy MAP. Data on public sector energy use has been poor but this is beginning to change. As from January 2011, all public bodies have to report their energy performance to SEAI and in their own annual reports. Regarding the exemplary role assigned to the public service, NGOs have been critical of central government performance recently and in the past. A recent report praised the OPW’s Optimising Power@Work energy efficiency campaign and SEAI schemes, but castigated slow progress in the Departments of Education, Health and Social Protection (DFOE, 2012). Hernan (2010) compares the lack of binding policy requirements or sanctions enforcing policy in the Republic of Ireland to the mandatory participation in the UK Energy Efficiency Scheme applying to the public sector in Northern Ireland. In this scheme, all participants buy carbon allowances and revenues are recycled to the participants based on the emissions reductions that they actually achieve. In Denmark in the 2000s, the public sector had been directed to “lead the way” and was, with the household sector, the target for many government policies. However, a review of Danish energy efficiency policy disappointingly found that in 100 public buildings (totalling 1 million m2) EUI increased by 10% in electricity use and by 4% for heating (Togeby et al., 2009:305). Ireland is following a similar policy so this may be a salutary example worthy of further study. 2.4.1.4 Dublin City Council – Policies and Targets The 2010 Dublin City Sustainable Energy Action Plan, or SEAP (DCC/Codema, 2010b), published following Dublin City Council’s signing of the Covenant of Mayors

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in 2009, examined the cost and potential of using 18 measures for reducing carbon emissions in Dublin City. The net annual investment required was estimated at €200 million.

Upgrading boilers has minimal net carbon abatement cost but renewable

energy infrastructure, demolishing older houses and window replacement are very costly. In the SEAP, the fiscal incentives are to come from national and European grant programmes. Past behavioural actions noted are the Switch-Off campaign, a Workplace Travel Plan, and the Minus 3% project (proving that 3% annual energy saving is viable) though no on-going management targets are mentioned. Dublin’s per capita carbon emissions from existing buildings are noted as being 25% more than London’s and more than twice Stockholm’s. The Dublin City Climate Change Strategy sets out the 20% carbon emissions reduction target, the 3% per annum public sector energy saving target and also states that progress in the twelve named indicators will be reviewed annually (DCC/Codema, 2008). A full first year review was published in 2009 (DCC, 2009); however, no further reviews have been published (DCC, 2012a). DCC owns 26,500 housing units, some with a history of fuel poverty (RTE, 2011). A Housing Energy Action Plan is mentioned as being currently developed by the Housing Department and Codema. Although the SEAP refers to a defined 2006 baseline (DCC/Codema, 2010a) and headline targets, the schedule of actions (regarding buildings, transport and renewable energy) does not itemise the results expected or give performance indicators to measure verifiable progress, potentially weakening the plan’s value.

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2.4.2 National and Local Governance in Ireland Governance in Ireland is highly centralised with local government having a much smaller role even though it acts as an agent in delivering many services funded by central government and has the advantage of closeness to local residents (Lane, 2011:69). A report by Indecon (2005) found that local government is heavily dependent on central funding and advocated more financial independence.

Following the

economic crisis though, both capital and current public spending have been curtailed and will be very restricted in the near to medium future (Lane, 2011:72-84). MacCarthaigh (2012) details how cabinet government in Ireland has been described as having ministerially controlled “silo-like” departments but has also developed ‘delegated governance’ in assigning responsibilities to agencies of varying kinds.

However, the Irish application of ‘agencification’ has been diverse and

unstructured, producing a complex ‘organisational zoo’ with many agencies, of many kinds, with varying degrees of accountability to government, or autonomy from it, (ibid.:131-135), echoing Brundtland’s concerns about the wisdom of devolving management responsibilities to agencies (Para. 34-35, UN-WCED, 1997). This would also seem to be potentially at odds with energy management good practice, which directs managers to lead responsibility for energy saving. MacCarthaigh and O'Malley (2012:260-263) conclude that reform proposals are often not implemented or get bogged down in process rather than emphasising results. They identify a lack of specialist skills across government and an urgent need for national and local government coordination with far more local input and empowerment. Performance evaluation and accountability with systemised monitoring are also viewed as critical to improve governance at all levels. With a quotation from Machiavelli, Considine and Reidy (2012:102) illustrate the difficulties of overcoming 29


‘path dependency’, resistance to change, in institutions and bureaucracies.

They

identify the need for ‘critical junctures’ within institutions so that critical opportunities for change are realised to break from established patterns that add to policy inertia ibid.:104). They conclude that ‘critical moments’, like Ireland’s on-going, ‘five part’ interlocking crisis (NESC, 2009), may not necessarily result in such changes occurring, particularly when judged by past Irish political history. 2.4.3 Dublin City Council Energy Usage 2.4.3.1 DCC Annual Reports 2010 and 2011 In the Annual Report for 2011, Dublin City had Operational Expenses (including energy) of €279 million although no specific energy cost figures are shown in the Annual Reports for 2010 and 2011 (DCC, 2012d). Separately, an analysis of council energy usage is given stating electricity use (72 GWh) but no figures are given for gas usage, total energy use or carbon emissions (ibid., Appendix 9). Mention is made of energy performance initiatives, the largest being Ballymun Regeneration work with savings of 10 GWh. Kilbarrack Fire Station, the world's first carbon-neutral fire station is noted as saving 633 MWh. The 2010 and 2011 DCC energy costs (DCC, pc) were as shown in Table 2.3. The rise of 28% in gas cost from 2010 to 2011, in spite of a warmer year in 2011 than 2010, is particularly notable and is likely to be cause for concern. Table 2.3 DCC Energy Costs 2010 and 2011

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(Figures supplied by DCC, personal communication)

Data quality problems were noted in the recent SEAI report (SEAI, 2012h) and there are some large apparent inconsistencies in the figures given for DCC energy use by the NEEAP (DCENR, 2009:53)and the DCC SEAP (DCC/Codema, 2010b). The difference between these figures amounts is more than 30%, indicating possible uncertainties, casting doubt on the usefulness of the headline policy targets. DCC leisure centres are part of the Recreation and Amenity Department that had expenditures or 77.9 million with income of â‚Ź11.2 million. Both the 2010 and 2011 Annual Reports make special mention of on-going provision required for the three stand-alone swimming pools at Crumlin, Sean McDermott Street and Coolock (DCC, 2012d:85). The 2011 report notes the reduced income across the leisure centres and the aim to maintain services. 2.4.4 Funding Local Authority Retrofit 2.4.4.1 Social Housing Retrofit Grant Funding Investment in local authority energy retrofitting comes in annually provided grants from the DECLG for social housing retrofit and from DCENR through SEAI, or other from departments, through grant schemes that can fund public building retrofit. Curtin (2009) states that about 1.2 million homes require retrofit to reach a C1 BER, which would take 85 years at the 2009 level of investment. A National Energy Retrofit Programme is being planned for both domestic and non-domestic sectors to be funded by the new EED energy supplier obligation and by new market energy service providers such as ESCos (DCENR, 2010). Energy retrofits to this local authority owned dwellings are part-funded by the Social Housing Improvement Programme (SHIP) with funding amounts based on the

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improvements achieved in BER ratings (DEHLG, 2010; for statistics see DECLG, 2012a). Total SHIP funding for 2012 is €251 million in capital allocations to local authorities (O'Sullivan, 2012). Fuel poverty affects close to 20% of Irish households with serious effects on health and comfort, yet addressing them would have high net benefits for the State and yet the poverty persists (Scott et al., 2008). Scheer (2012) describes how reallocation of the current €465 million in energy subsidies could be effectively reallocated, within current funding, to energy efficiency upgrades with significant benefits for the economy and subsidised households in fuel poverty. Given the high net real financial benefits accruing from these long-term investments according to these economic analyses, it follows that it is either the nature of the problem politically, or the length of the investment, or both, that inhibits action. Some small pilot ‘area-retrofits’ have been carried out in fuel poverty affected areas: in Tralee, Co. Kerry and in Dundalk, Co. Louth, estates of private and public houses were upgraded using SHIP and SEAI funding (SEAI, 2011a; Ó Dónaill, 2011). A ‘fabric-first’ approach, insulating and increasing air tightness, is found to be potentially effective in reducing energy use and carbon emissions in an analysis by Wyse (2012) of the potential option in upgrading social housing in Co. Wicklow, but the study notes that this is not common practice in current local authority retrofit programmes. 2.4.4.2 Better Energy Workplaces: Retrofit Grant Funding The Better Energy Workplaces scheme, aiming “to deliver a major increase in pace, scale and depth of sustainable energy investments in upgrading existing buildings and facilities” (SEAI, 2012c) with a total fund of €7.5 million for part-funding of

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energy retrofits to private or public sector buildings was announced on 14 March by DCENR, with applications to SEAI to be received by 30 April and successful applicants to be informed in June (SEAI). The Application Guide (SEAI, 2012c) was published on 21 March 2012 for public and private sector applicants seeking grant part-funding of retrofit projects from the 2012 BEW scheme. If approved for funding by SEAI, a noncommercial public sector application would typically receive the 35% of eligible costs up to 50% in exceptional circumstances. A particular focus is on applicants involving third-party ESCo or energy supplier involvement to engender ‘pay as you save’ longer term funding for projects, thereby increasing the scale of this funding mechanism (SEAI, 2012a:15). Ewing et al. (2005:30) critique an earlier SEAI grant scheme for not following Aarhus Convention provisions in being open to public consultation to learn from community experience in regard to maximising investment returns or market choice.

2.5 The DCC and DFB Green Plan Developed and instigated by Fire-Fighter Neil McCabe of Dublin Fire Brigade (DFB), the Green Plan was instigated in Kilbarrack Fire Station in 2007 and has been supported by DCC (DCC, 2011). Founded on the four sustainability pillars of The Natural Step programme, the Plan’s two core principles are behavioural change, increasing the awareness of energy and water use, and carbon emission reduction, aiming to trade in the Irish Voluntary Carbon Market by 2011 (McCabe, 2011b). The plan, focuses on seven areas: energy, water, waste, biodiversity, transport, society and procurement (DCC, 2010). Numerous verified results are listed by McCabe (2011b). The flagship project at Kilbarrack Fire Station has involved firefighters in adopting sustainable responsibility as a new ethos in their work as well as utilising

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capital investments in water and energy saving technology that have combined to make very large savings that are being reinvested in further energy saving. Over 85% of water for fire fighting is now collected from the station’s roof and energy demand has been cut by more than 80% in two years, paying back the total upgrade investment in 3.3 years and with an on-going saving of over ₏37,000 per year (McCabe, 2011a). These are exceptional savings when compared to public building retrofits elsewhere in Europe where deep retrofit savings of 20-70% are more common (ErhornKluttig et al., 2004; Ardente et al., 2011).

2.6 Literature Review Conclusion Comparing the energy management literature to the public sector documents appears to show inconsistencies. The former stresses linked, consumption and cost energy accounting and sustained managerial support for operational energy saving programmes. By contrast, published Dublin annual reports and national policy figures do not link energy costs with energy consumption in kWh and carbon emissions. Unlike the European carbon emissions target, national and Dublin energy policy targets lack staged performance indicators or sanctions that would register progress or invoke renewed effort. Public sector energy use is not accurately known nationally and the baseline energy use given for Dublin City Council appears to vary significantly between documents indicating problems with methodology or data, undermining the validity of the targets. High per capita carbon emissions, a high level of fuel poverty and notably high running costs in older swimming pools suggest problems with past, and perhaps, existing energy policy and implementation.

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CHAPTER 3 RESEARCH METHODOLOGY 3.1 Research Methodology Outline Following an overall sequential approach, the research aim was to produce data to assess whether national energy and emissions policy, in its implementation at local level in Co. Dublin, is consistent with good practice in energy management and retrofit investment. The results would potentially be generalisable both to local authorities nationally and to national energy saving policy with respect to local authorities. Three individual methods were used within this guiding design: 1.

Observation by survey of a specific sub-case: the energy management of DCC leisure centres with analysis of DECs and identification of energy saving potential;

2.

Documentary analysis of guidance and data sourced from a DCC application for retrofit funding, later approved by SEAI, with analysis using standard government and value investment principles;

3.

In-depth interviews with informed respondents to extend the research to the overall local authority approaches to energy management and investment.

3.2 Research Strategy The focus of this research is specific to the current organisation of energy management and building retrofit in the Co. Dublin local authorities so it formed a defined 'case’, initially based on DCC leisure centres, for which a case study research strategy would be appropriate. A case should be located in a 'natural setting', being something or somewhere that exists already rather than being generated artificially to test theories (Denscombe, 2010, Chapter 2;).

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This study's case is: local authority implementation of national policy on carbon emissions and energy efficiency, particularly, though not exclusively, relating to public buildings and social housing. The case study approach is especially valuable in providing holistic explanations of why particular behaviours, delays or end-results occur in complex organisational situations – by investigating processes, interrelationships, and underlying details that contribute to the outcomes (ibid., Chapter 2;). Multiple methods with multiple data sources are particularly appropriate to complex problem types, provided the methods follow a logical research procedure (ibid., Chapter 8;). Creswell and Plano Clark (2011, p.81-86) observe that case study strategies are often 'mixed method' strategies involving both qualitative and quantitative research methods. The use of alternative methods provides 'triangulation,' giving a more complete picture of the subject by obtaining complementary data that may or may not corroborate the findings (Denscombe, 2010, p.348;). The overall strategy adopted for this case study research can be depicted in the notational shorthand of mixed method designs as 'qual/quan ➔ QUAL' (ibid., Table 4.1), following an explanatory design (ibid., Figure 3.4) such that the initial qualitative and quantitative research was followed emergently by a deeper phase of qualitative research interviews exploring the different aspects of policy in practice as viewed by informed respondents.

3.3 Research Methods 3.3.1 Methodology for Leisure Centre Surveys Surveys of nineteen Dublin City Council leisure centres were carried out during a work-placement at the City of Dublin Energy Management Agency (Codema) – summarised in the DCC Leisure Centres: Display Energy Certificate Advisory Report

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by Codema for the Culture, Recreation and Amenity Department of DCC submitted in July 2012 (Price, 2012). The finished report summarised common and building-specific energy-usage problems and potential solutions. The 'walk-through surveys' carried out are the most basic level of building energy audit (Kelsey and Pearson, 2011). This type of on-site, brief building survey aims to make a simplified, energy-usage description of the building (covering lighting, heating, ventilation and fabric) and to list basic energy-saving opportunities identified by the survey including observations and energy-usage comments made by staff. For each building, a measurement of the building's heated area was made using a laser-measuring device to take length measurements. Rough site sketches recording the measurements and, where possible, drawings available on-site, were then used to calculate the heated floor area of the building. Survey conclusions relevant to the research question are reported in the Chapter 4. Combining the measured area with energy usage billing data from the Codema database enabled calculation of a provisional DEC rating using the SEAI DEC Tool spreadsheet (SEAI, 2012g). Further analysis (see Section 4.2 and 4.3) tabulated and charted the data, total energy use and energy utilisation index (EUI), to provide comparisons of the existing energy use and the extent of the available data for the centres. An additional scatter chart analysis of the leisure centres on a graph of total energy cost versus energy cost index (ECI) was made to evaluate this chart type’s usefulness in identifying locations that might yield the largest energy savings given appropriate energy management.

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3.3.2 Methodology for Document Analysis

• Documents analysed: SEAI Better Energy Workplaces Guide and an Application Form as submitted by DCC, 30 April 2012. The document analysis sought to assess whether a current government retrofit grant-funding scheme (Better Energy Workplaces 2012) is consistent with accepted investment principles for data quality and investment appraisal for deep retrofit. The application form itself and the BEW application guide became a source for research data. This was examined to give insights into the operation of current government energy saving policy that aims to encourage wider and deeper investment in building retrofits, particularly targeting investment innovation though the involvement of ESCos and energy suppliers (SEAI, 2012b).

The analysis involved examining the BEW

Application Guide and a BEW Application Form (referred to hereafter as Guide and Form) submitted by DCC on 30 April 2012 and approved by SEAI for grant funding on 16 August 2012.

As Denscombe (2010, Ch.12) notes, such documents are an

authoritative source of data and analysis that can be used to determine the accuracy of the figures given, or the presence of bias and errors, thereby providing indicative assessments of their likely effects. 3.3.2.1 Document Description and Data The Form's numerical data were tabulated and observations were made about the form as submitted. Where there were spaces on the form for information, the general level of detail in these were noted. These findings are in Section 5.5.1. 3.3.2.2 Assessment of Data Quality and Relevance before Appraisal As the quality and relevance of an investment proposal's data must be assessed before undertaking financial appraisal (p.28 Holmes, 1998), the Sub-Project data

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provided was qualitatively assessed using three quality parameters that must be confirmed, insofar as possible, before any financial appraisal can proceed: a) Were the annual savings predicted for each Sub-Project "solely attributable to commencement" of the investment measure (p.8 ibid.); b) Were the Sub-Projects for a particular building fully independent or is some double counting of savings possible because the combined savings of the measures overlap if two or more are installed. Only the ‘incremental’ benefits of each added measure can be included in a financial appraisal (p.8-9 ibid.) c) Were the data and assumptions for costing the measures robust enough to commit to an investment insofar as can be judged from the application form? To quote Holmes (1998:7): "the investment appraisal process can only be as good as the data on which any calculations are based." Taking the Application Form as an example, findings were made indicating where these parameters may, or may not, have been met or where the assumptions made in preparing the data appeared to be uncertain. 3.3.2.3 Methodology for Comparison of Alternative Appraisal Methods The financial appraisal methods mentioned by the guide and used in the application were identified and any supporting information for lifecycle costing or discounting methods of appraisal was noted.

To inform discussion of alternative

financial appraisal methods, the Form’s sixteen retrofit proposals were used as a hypothetical basis to inform an examination of appraisal methodologies (for findings see Section 5.5.3).

This comparison was undertaken because no such illustration

comparing the methods was seen in the literature and it might therefore provide findings

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useful in choosing appraisal methods in regard to ranking or accept/reject decisionmaking. An Excel spreadsheet was made to make these calculations for the various appraisals, in part based on and checked against the Excel formulas and examples provided by Kehily (2012). Kehily (pc) confirmed that 15 years would be a reasonable minimum lifetime over which to compare investments for NPV results so, for consistency in comparison (Ruegg and Short, 2007:3.22), this was used as a base period for all appraisals, except for a variable lifecycle method in use in Denmark for retrofit appraisal. The spreadsheet was made using the total costs and energy savings data as provided on the Form (using standardised gas and electricity costs to correct Form data errors) as well as using accepted government figures for nominal discount and inflation rates as inputs. Five appraisal methods were compared: Simple payback; Net Present Value (NPV); Profitability Index (PI), also called Benefit to Cost Ratio (BCR); annualised PI, giving the effective energy cost after retrofit (Russell, 2010); and the Danish PI method as described by Aggerholm (2011). The latter, a simple non-DCF method with a clear acceptance level, weights the study period for individual measures relative to their likely service life. This was also modelled for the projects to show an alternative method for retrofit assessment currently in use for building retrofit appraisal elsewhere in Europe. Using output from the spreadsheet, this analysis aimed to clearly illustrate the decision-making differences between alternative appraisal methods.

For this

hypothetical comparison, the Form data was found to have inconsistent base energy costs, so the savings data was normalised using a single cost each for electricity and gas, and multiplying by the kWh savings given. 40

For the NPV and PI calculations, the


lifecycle used was set at fifteen years. The installation costs in the Form were assumed to be the total cost for the calculation. (Whereas for a lifecycle costing, all discounted costs over the lifecycle would normally be included, and any resale or residual value of the measure would count as a benefit.) The nominal discount rate used was 6.7%, the Government capital investment rate as of 2010 for projects of 5 to 20 years (DPER, 2012). The escalation rate for energy cost increases used was 3.1% (Scheer and Motherway, 2011:7). This resulted in a real discount rate of 3.5%, compared to the 4% used by Scheer and Motherway. Table 3.1 Appraisal Methods, Definitions and Acceptance

The appraisal methods are shown in Table 3.1. As for all appraisals the data must pass the criteria listed in 3.3.2.2 before the appraisal is done. A comparison chart of the proposal rankings using different appraisals was then made to facilitate discussion. 3.3.2.4 Limitations of the Document Analysis Methodology This analysis was limited to assessing the type and comparative usefulness of investment appraisal that the Guide and Form mention. No conclusions are made about the DCC data assumptions except where the assumptions appear to be in conflict with

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investment principles, or with other relevant data found within the application or from other sources. The Guide and the layout of the Form are the same for all applications so the descriptive findings are applicable to the BEW 2012 fund. Different applicants would have filled out the form differently so the analysis of the data given covers just this case as it informs its grading or appraisals. The spreadsheet-based comparative analyses for this form are intended to chart the relative rankings and different acceptance criteria of the alternative appraisal methods using the Form data as a basis. For the purposes of this illustration, the Form data was used by hypothetically assuming that all of the (normalised) savings data was of high quality and met appraisal quality thresholds. Although sensitivity analyses were carried out using the spreadsheet, with different discount and escalation rates and different life cycle periods, only one analysis is illustrated, as the aim is only to compare the results of different appraisal methods to more clearly illustrate their relative decision-making usefulness. 3.3.3 Methodology for In-depth Interviews 3.3.3.1 Interview Methodology Basis Interviewing knowledgeable respondents emerged as the most appropriate method for answering the questions arising from the findings from the initial research methods.

Long-form interviews require large amounts of time in organisation,

transcription and analysis, so the relatively few informants need to be chosen according to the insights they may have due to the position they hold or their experience (Denscombe, 2010, p.181;). Kvale (2007:35-36) sets out seven stages of an interview enquiry, which directed the sequence of the research method: ‘thematising’ and design, through interviewing 42


and transcription to analysing (based on key topics related to the research question), by verifying the data by cross-comparison, and finally reporting the data in rigorous and readable form. The following outline gives a summary of the interview design used and how these stages of interview enquiry were undertaken. 3.3.3.2 Interviewee Selection For this research, interviewees with knowledge of local authority energy management and/or building retrofit were chosen, largely focusing on Dublin City Council, as this was the origin of the initial data. Concentrating on Dublin City alone would have given a small range of data given the scope of the research question, covering only a highly urban, very large local authority with many older buildings. Extending the interviews to a respondent architect, from adjacent peri-urban authorities in DĂşn Laoghaire (DLRCC), a smaller authority with many older buildings, and in South Dublin (SDCC), also smaller but with many newer buildings and a large amount of social housing, enabled two reference interviews with county architects giving some triangulation of data and potentially a larger range of applicability for the research conclusions. The interviewees were chosen for their knowledge of the leisure centres, energy management, buildings, building retrofit, and energy billing and consumption accounting to give a wide range of expertise to provide data to answer the research question. Two interviewees were responsible for monitoring grant money to local authorities, ten interviewees were from the local authorities and one was independent of government. Each interview was recorded to an MP3 file using a digital voice recorder and then transcribed by the author into a text file.

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The total recorded time for the thirteen


interviews was 783 minutes, varying in length from 39 to 94 minutes with an average interview length of 60 minutes. The respondents interviewed for this dissertation research were: • Paul Altman – Architect, Architecture and Building Standards, Department of Environment, Communities and Local Government. • Mary Balfe – Finance Office, Dublin City Council • Patrick Barry – Architect, Irish Green Building Council; • Jim Beggan – Manager, Leisure Centres; Culture, Recreation and Amenity Department, Dublin City Council; • Athena Candy – Senior Staff Officer, Corporate Services, Dublin City Council; • Sarah Cassidy – Architect, Dún Laoghaire Rathdown County Council • Matt Carroll – Architect, City Architects, Dublin City Council; • Eddie Conroy – County Architect, South Dublin County Council; • Joe Hayden – Energy engineer, City of Dublin Energy Management Agency; • Cormac Healy – Duty Officer, Poppintree Leisure Centre, Dublin City Council; • Neil McCabe – Firefighter, Kilbarrack Fire Station, Dublin Fire Brigade • Colum O'Ruanaidh – Architect, Architecture and Building Standards, Department of Environment, Communities and Local Government. • Alan Ryan – Programme manager, Sustainable Energy Authority of Ireland; • Gerry Wardell – Director, City of Dublin Energy Management Agency.

3.3.3.3 Interview Framework, Topics and Individualised Guides The informants have extensive knowledge directly relating to the research question but have greatly differing positions and experience. Therefore the interview

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design called for a generalised 'interview schedule’ listing the main topics related to the research question as a basis for individual interview guides and mainly open questions appropriate to the background of the informant (Gibbs, 2011). More direct, follow-up questions were included in the guides to confirm specific data or hypotheses relating the interview topics.

For each interview, a slightly revised guide was made but the

underlying topics were the same for each. Such an in-depth approach required longer interviews (of 40 to 60 minutes in length) to elicit insights and sufficient time to cover the main areas of interest.

Figure 3.1 Interview Topics Derived from EMM Categories.. The main topics for the interview plan (Figure 3.1) were identified on the basis of an EMM (Table 2.1) dividing the overall application of energy management into descriptive categories and assigning a zero to four level of attainment to each. 3.3.3.4 Interview Data The full interview data, the transcriptions (with codings and comments) are printed in Volume 2 of the dissertation.

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3.3.3.5 Commenting and Coding of Interview Data For analysis, the text transcription for each interview was transferred to a Microsoft Word document so that ‘document comments’ could be made and automatically sequentially numbered. Each mark-up comment was made by identifying a section of a respondent’s response that was relevant to a coding category; the code was then assigned, and a level of attainment and a level of governance to which the coding was applied was noted, as guided by the EMM (Table 2.1) and the coding frame (Figure 3.2) based on it that was used to more clearly identify the topic of a coded response. For example, a response containing reference to good energy management communication between council departments would be assigned an MS3L coding: ‘MS’ indicating the ‘Management Structure’ category; ‘3’ a good level of attainment; and ‘L’ signifying the ‘Local Authority’ level of governance. If comments referred to relations between levels of governance the higher level was identified in the coding as being the more relevant one. For each coding made, an associated comment was also made to justify the coding and/or to give a brief description of the response to aid in collecting and sorting findings. The codings rely on the coding process, the range of questions asked and the way in which respondents chose to answer them.

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Figure 3.2 Coding Frame for Interview Data derived from Typical EMM.. The coding is used to categorise respondent responses by matching them to the description given.

3.3.3.6 Coding and Coding Analysis of the Interviews To sort and analyse the codings, each coding and associated comment made in the Word document for an interview was copied into a line of a worksheet along with the interview number and comment number. A hierarchical sorting by EMM topic, then by level of governance, and finally by level of attainment was made. This analysis method eased the location of similar comments in the whole set of interviews allowing all likecoded comments to be collated into findings. To sort categories that had large numbers of codings, a second sort of the codings spreadsheet was made, to give appropriate subcategories to further simplify collation of the findings regarding similar topic points (collating similar or dissimilar responses to the points). The interview findings are presented as a text summary aiming to accurately reflect respondent comments within the seven EMM coding category headings. The brief coding comments served only as a location and sorting mechanism. 47

In


summarising the findings, the original response was the guide rather than the coding comment.

3.4 Limitations to the Research Strategy and Methods A case study concentrates research on a definite, limited and self-contained area of policy, programme, occurrence or place (Denscombe, 2010:55). By definition, case study research has limitations because it provides a limited view of a particular case (ibid., p.304;). For this dissertation, the researched local authority is primarily Dublin City with some reference as comparators to two adjacent authorities, South Dublin and DĂşn Laoghaire Rathdown, potentially limiting the applicability of research findings to larger urban local authorities. ‘Walk-through’ level energy audits are time-limited (one to four hours) and the conclusions reached in surveys partly rely on conversations with leisure centre staff of varying knowledge of energy management. The data analysis was limited by the quality and quantity of data available. The simplified investment appraisal analysis presented was not an in-depth analysis specifically addressing data or technical issues. It was limited to an overview of the documents as they were relevant to the research question and in investigating current practice in retrofit investment appraisal. Alternative methods of appraisal were investigated as they were recommended by the literature review. There are limitations to in-depth interview research with expert informants, particularly the relative lack of knowledge of the interviewer (as detailed by ibid.:193). Coding of interview data reduces these limitations to some degree but can introduce additional bias. Each of these potential shortcomings will be individually considered in discussion in Chapter 7.

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CHAPTER 4 LEISURE CENTRE SURVEY 4.1 Observations and Findings: Leisure Centre Survey Report The nineteen surveyed leisure centres form a varied set of buildings that may be usefully grouped according to age, usage and size. In general, the centres divide into two age groups: older buildings (three swimming pools, two sports halls, and an allweather centre) built in the period 1968 to 1990; and, more modern buildings, mostly sports and leisure centres built since 1990 and particularly since 2000. By usage, the surveyed centres may be grouped as follows: seven with swimming pools (three stand alone swimming pools; three large leisure centres including swimming pools; and one pool and fitness centre); six combining a sports hall and leisure centre without a pool; two sports hall and boxing centres; an athletics stadium and fitness centre; a water sports centre; a rowing centre; and an all weather sports centre. For survey photographs of the leisure centre exteriors see Appendix K. By conditioned floor area, the surveyed centres ranged in size from the smallest, 268 m² for the sports field changing rooms at Clontarf, to the largest centre of 4429 m² for the Ballyfermot Leisure Centre. The main findings of the surveys are summarised as follows: •

With one exception, no on-site monitoring of any kind was noted at any of the centres. No automated collection of data from interval metering or sub-metering is occurring even in large centres with Building Management Systems.

As far as could be established, manual collection of meter readings is only occurring at Poppintree Leisure Centre, where the Duty Officer, who has an interest in energy management and the potential for cost saving, has been noting

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weekly electricity and gas meter readings since May 2010. These have been entered in a spreadsheet to log readings and enable monitoring of energy use. •

All energy bills go directly to the Finance Office for payment so the leisure centre managers are usually unaware of billed current and past energy costs or consumption. The lack of on-site monitoring means that bills cannot be checked against past meter readings.

There are heating and ventilation problems in many of the centres. Windows are often opened, particularly in gyms to aid ventilation, but were observed remaining open on cold days when the heating is on.

During the survey, lights in rooms with many lamps were seen left on when the room was unoccupied or when daylight levels were more than high enough for them to be switched off, including large sports halls.

The “Switch off

Campaign”, the behavioural energy saving initiative was not evident in the centres. •

The older swimming pools (Coolock, Crumlin and Sean McDermott Street) all suffer from very poor building fabric and out-dated ventilation systems with either only supply air or ineffective dehumidification.

DCC does not own Coolock Swimming Pool, located on the top of the Northside Shopping Centre, but DCC pay for its use and its energy usage.

It is an

exceptionally poor building with single glazed windows throughout, uninsulated concrete walls, poor ventilation (no extract air), moisture problems and very poor air-sealing. •

A predominant view from staff comments was that energy management equates primarily to on-going maintenance of boilers and HVAC systems by outside contractors or of lighting replacement by DCC buildings maintenance staff. The

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interrelationship of the staff and users with the building is not clearly defined as an important part of leisure centre energy management. •

Crumlin is scheduled for renovation due to a leaking roof having been under threat of closure. It has poor comfort levels due to un-insulated masonry walls, very high heat loss due to two large extractor fans, one in each end wall and, as at Coolock, noticeably cold entrance lobby areas.

Sean McDermott Street Pool shows similar problems. Severe moisture damage to the roof, because of poor ventilation, had closed the gallery area.

The older pools have recently installed new pool covers to reduce evaporative heat loss during closed periods. Crumlin and Sean McDermott now have new heat exchangers to heat the pool water more efficiently.

Most buildings have well insulated distribution pipes, but deteriorating or missing insulation was seen on some pipes and hot water tanks in older centres. In Aughrim Street, a hot water tank was found to be entirely unlagged.

In the large centres, Ballymun, Finglas and Ballyfermot, the plant room is distant from Reception or the Manager's office and the BMS laptop is not easily available for daily or weekly timetable matching to the bookings.

Two leisure centres, Finglas and Ballyfermot have Central Heat and Power (CHP) units. These were both working during 2010, but the one at Ballyfermot is not now working because of a failed turbine for which a replacement part is not available, due to the manufacturer going out of business.

Ballyfermot Leisure Centre has a design issue in that the swimming pool area is open to the changing area, which in turn has a weight training gym above it, so heat and moisture from the pool affect the gym requiring additional ventilation.

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Energy saving recommendations were made in the survey report’s conclusions (see Appendix D) covering lighting, area and specific buildings. They were divided into low, medium and high impact; and low, medium and high cost.

4.2 Leisure Centre Area and Billing Data The measured and collected data with calculated provisional DEC ratings are shown in Table 4.1. Grey cells indicate billing data for 2010 that was unavailable as at June 2012. Glin Road was assigned a G-rating because the oil consumption could not be accurately estimated. Markiewicz Swimming Pool shares its gas supply meter with the building above it so the data may well be inaccurate in application to the leisure area alone. The heated or conditioned area is shown in the table although the unconditioned area was also measured. In most centres the unconditioned area is mostly plant rooms and storage, but at Ballymun there is a large underground car park. Table 4.1 Leisure Centre Energy Data, Measured Area and DEC Rating

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4.3 Leisure Centre Energy Data Analysis For each of the 19 centres there is an electricity bill and a bill for thermal energy (all gas with the exception of Glin Road Sports Centre, which is heated with oil) giving 38 bills in total. By June 2012, 15 of these bills, as shown in Table 4, still remained unavailable from the energy suppliers for use in energy accounting by Codema and the Leisure Centres. Hard copy bills with the consumption figures are available in the DCC Finance Office but they are logistically very difficult to locate and analyse. Any one building’s usage would have to found within a long list from the same supplier and the data may not be easy to collate. There are also different suppliers each with different reporting formats. As of September 2012, Codema had billing information for 2011 as well as 2010. Data remaining absent from the Codema database as of September 2011 included: for 2010, five electricity bills and eight gas bills remained unknown; for 2011, three electricity bills and four gas bills were missing (Codema, pc). The incomplete data for energy usage, due to missing bills, is noted by text in Figures 4.1 and 4.2.

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Figure 4.1 Total Energy Usage of DCC Leisure Centres Figure 4.1 shows the total energy use and Figure 4.2 shows the energy use per square meter (EUI) for the surveyed leisure centres.

Figure 4.2 Energy Utilisation Index for DCC Leisure Centres

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Figure 4.3 2010 and 2011 Total Energy Cost versus Energy Cost Index. Arrows in Figure 4.3 indicate change in costs from 2010 to 2011 for individual named leisure centres. Points for centres with lower energy use are not named and those missing data are omitted.

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CHAPTER 5 DOCUMENT ANALYSIS 5.1 Findings: Analysis of Documents 5.1.1 Description of Application Form The BEW Application Form is in Appendix G. The Form (DCC, 2012c) details upgrade projects proposed for four buildings with sixteen separate 'Sub-Projects' (SPs) each individually numbered 1 to 16 (referred to below as SP1-16). The SPs included: eight for Ballyfermot Library, four for Kevin Street Library, and two each for Crumlin and Sean McDermott Street Swimming Pools. The total energy consumption and cost figures for each building are given first, using 2010 figures with the predicted building savings given as the total of each building's SP savings. Each building is described separately with a tabled listing of its SPs giving a description of each retrofit and the predicted electrical or thermal savings in kWh for each. Each SP is then detailed briefly giving a Project total cost figure (including new equipment cost and installation cost including labour), the predicted annual savings in euro and the simple payback in years. None of the boxes available to fill in for the NPV and IRR of the SP were filled in on this particular application. An excerpt from the DCC BEW Application is shown in Figure 5.1.

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Figure 5.1 Excerpt from DCC BEW Application showing Sub-Project 1 details.

Spaces below for ‘Assumptions’, ‘Non-Energy Cost Savings’ and ‘Measurement and Verification Methodology’ are not shown – only the latter was filled in for the subprojects. Additional space for each SP gave space to enter: • a description of the basis for energy savings; • all assumptions and associated values used in calculation; • non-energy cost savings with assumptions on how they are derived; • measurement and verification details. In all cases the description of the M&V details were entered, none involving International Performance Measurement and Verification Protocol (IPMVP). In no cases were any details of the assumptions or values used, or any non-energy cost savings entered. From the document, SP descriptions (abridged) and their related data are shown in Table 5.1

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Table 5.1 Collated Sub-Project Descriptions and Data.

Saving for SP6, in greyed cell, is calculated from the data given.

5.1.2 Findings: Application Guide A copy of the Application Guide is in Appendix G. 5.1.2.1 Financial Appraisal Method The Guide (p.7) states that the four criteria for assessment of a BEW application are: ‘Value for Money’, its benefit in energy, carbon and cost savings relative to its cost (40); ‘Quality and Delivery’, its demonstration value, replicabilty, and the applicant's ability to deliver by the deadline (30); ‘Innovation’ in wide application or finance delivery (15); ‘Jobs Benefit’, the labour-intensity of the project (15). The marks in brackets are the maximum possible mark that could be allocated during grading by SEAI. Specifically noted under Value for Money is that:

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Included in the consideration in this category will be the value of the investment to the State and the quality of financial appraisal of the project (SEAI, 2012c) Following grading, the final approval is also noted as being dependent on: “project payback timeframes”, the market incentive effects and the applicant sector (commercial, public sector etc.). Although there are boxes on the form for NPV and IRR there appears to be no mention of either criterion anywhere in the guide. Neither in the application nor in the guide is there any standard study period, lifecycle or time horizon on which to judge an investment for an NPV or IRR calculation. From the above data it can be concluded that the financial appraisal method being used in assessment and being encouraged by the BEW funding scheme is simple payback. 5.1.2.2 Investment Appraisal Data The SP costs identified by the Guide (p.6) as being eligible for inclusion in the total cost of the measure for grant consideration are restricted to installation costs due to labour, materials or specialist assistance. Costs not related to energy performance improvement and on-going monitoring costs are not eligible. To verify savings, “projects must include an efficient and effective mechanism for energy use data collection and/or monitoring of the savings” (p.5). Large and complex projects are encouraged to have IPMVP monitoring. In the Terms and Conditions, grantees must comply with their commitment to using the mechanism of monitoring that they specified in the application form, but no penalty for failing to meet the predicted savings is specified (p.11).

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5.2 Findings: Assess Proposal Data Quality and Relevance These indicative findings reference the principles stated in the methodology (Section 3.3.2.2). In SP1, costing €15,000, the existing electric heating is to be removed and photovoltaic panels are to be installed with a projected saving of €9,868.

Two

measures, one removing an electricity demand and one installing an electricity supply are thereby included in the same SP. The electricity output of the PV panels is not given but, in SP9, the installation of PV panels costing €5,500 produces an annual saving of only €208. Therefore, it appears that in SP1 there must be a large saving ascribed to the removal of electric heating. However, removal of a heating method does not provide an alternative investment that results in a savings return. For an investment appraisal, the incremental saving produced by removing the electric heating is zero. The cost of removing the electric heating should not be part of an energy investment appraisal, it should be assigned to renovation costs. Given that the payback for SP9 is stated as 26 years, it seems likely that the payback for the PV panels in SP1 would be similar and therefore PV in this case should not be associated with the 2-year payback given. The calculated thermal savings shown for SPs 3, 6, 7 and 8, whose savings in heat for the same building would overlap, may account for their mutual influence, but without a listing of the assumptions that were made in making the estimates it is not possible to know. There appear to be no other SPs that are mutually affecting in a way that might allow double counting or where the projected savings were unlikely to be only from that particular SP.

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It is difficult to judge the robustness of the costings and savings from the Form because all of the boxes for detailing assumptions were left blank giving little opportunity for checking the assumed data parameters. Calculations for the savings related to HRV installation at Crumlin made by Temborius (2012) and another SBEM calculation (see Appendix H) appeared to show markedly lower energy savings than in the Form, potentially altering the savings data for that case. Similarly the confidence level for achievement of other projected savings could be questioned but this would require assumptions to be listed so that they could be checked. The base data for all of the savings projections was from one year, 2010, a year with 36% fewer 15.5 ยบC Heating Degree Days than 2011 (as calculated from Dublin Airport data, obtained from BizEE, 2012). Examining cost and consumption savings provided on the Form for the SPs in Table 5, there are inconsistencies in the implicit values of gas and electricity in cost per kWh. It is not clear why this would be the case as there should, presumably, be only one value assumed for each for a particular building.

5.3 Analysis: Comparing Appraisal Method Alternatives This Section's results relate to the methodology described in Section 3.3.2.3. As noted above, there were inconsistencies found in the implicit costs given for gas and electricity. For this hypothetical comparison of appraisal method alternatives it was essential to begin with consistent data to give an informative comparison. To enable this comparison, electricity was given a cost of 17 cent per kWh and gas a cost of 5 cent per kWh.

Table 5.2 shows the full costs, as before, with the annualised savings

normalised using these energy cost figures. comparisons illustrated in this section.

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This is the data used to make the


Table 5.2 Data used in appraisal comparison.

Annual saving figures normalised by using set cost per kWh for gas and for electricity.

Figure 5.2 shows the simple payback in years for the 16 projects. The shortest bars appear best in this appraisal as being the projects with the shortest paybacks. In the Guide and Form no accept/reject level was given, but a line for the 15-year study period, as used for the other appraisal calculations, is drawn in the chart.

Figure 5.2 Simple Payback in Years for the 16 Projects. Figure 5.3 shows the NPVs for the measures, yielding a different view of the appraisal. Marginally negative, unprofitable NPVs, as indicated by grey bars, are found for SPs 2,4,8,9,11. Four of the SPs, 1,3,13,15, have NPVs greater than â‚Ź85,000. The 62


two HRVs, SP13 and SP15, are found to have NPVs of €280,000. The remaining five positive NPV projects have NPVs of less than €20,000.

Figure 5.3 Net Present Values for the 16 Projects. Figure 5.4 charts the Profitability Index, also called Benefit to Cost ratio (BCR). PIs of under one (indicating unprofitability) are indicated in grey – the same five of the projects as for NPV.

Figure 5.4 Profitability Indexes for the 16 projects. Combining the PI values and NPVs on one scatter chart of the projects gives Figure 5.5. The base data is the same as that charted in Figures 5.3 and 5.4. This chart shows that while projects 13 and 15 are forecast to have very high NPVs, project 1 provides a higher return per euro invested. Of the 16 projects, 11 of them can be seen to have financially marginally positive or marginally negative profitability.

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Figure 5.5 Profitability Index versus Net Present Value for the 16 projects

Figure 5.6 shows the effective cost of energy after retrofit (ECER) with â‚Ź1 being set as the reference present cost (also called the ‘cost to avoid’). Grey bars indicate that the energy cost after retrofit is effectively more expensive than before retrofit, indicating rejection of the measure in this appraisal method.

Again this method

produces the same accept/reject results as for NPV and PI. As noted previously, this appraisal is an annualised PI method.

Figure 5.6 Energy cost after Retrofit compared to present cost.

Figure 5.7 shows the project value for money as appraised by the profitability index method used in Denmark for assessing retrofits. Lifetimes are assigned to each project based on service lifetimes that are weighted according to the type of measure as directed in Aggerholm (2011).

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Figure 5.7 Danish Appraisal Method Profitability Index

Figure 5.8 shows the rankings of the different appraisal methods to gauge differences between the alternative methods. For each project the ranking given by each appraisal is shown in the order: Simple payback, NPV, PI, ECER and Danish PI Method.

Tallest bars indicate the best ranking out of 16 given by the particular

appraisal for the 16 projects, and the shorter the bars the lower the rankings. In terms of ranking measures, PI and ECER are shown to be the same throughout, as ECER is an annualised PI. The Simple Payback, NPV, PI and ECER methods all produce very similar rankings of the measures, differing by a maximum of two ranking places. The Danish method, which uses different study periods for different classes of measure, produces markedly different rankings, increasing rankings for insulation, glazing and lighting, and decreasing rankings for fan and electric upgrades (allowing for earlier technology failure relative to more passive measures). Measures rejected by a particular appraisal are marked with a diamond below the relevant bar. The NPV, PI and ECER methods all reject the same projects because they have the same basis. Simple payback, if given a 15 year maximum as a rejection level, the study period for the previous methods, rejects one measure that the others do not, and accepts two projects rejected by NPV, PI and ECER. Given the weighted service lifetimes assigned, the Danish Method only rejects two measures, those with a PI of less

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than 1.33, indicating that almost all of the measures are sufficiently profitable that in Denmark it would be required that they be carried out.

Figure 5.8 Comparison of rankings by different appraisals methods.

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CHAPTER 6 IN-DEPTH INTERVIEWS 6.1 Interview Findings: Data Location and Citation Format All of the interview transcripts are located in Volume 2 of the dissertation. Each transcript is printed as a Word document with the view set to 'Final Showing Markup' mode thereby showing the sequentially numbered comment boxes that contain the EMM coding made and a short comment relating to the response identified. Specific comments are referenced in this chapter’s findings by interview number and comment number so that they can be readily located in Volume 2. For example, a response identified in ‘Interview 9’ by ‘Comment 78’ is cited as (9:78). If responses discussed below in the findings are not part of or immediately adjacent to a numbered comment, the transcript reference is cited as being between two numbered comments as in (4:35-36). In some cases clarifications or additional information was sought from interviewees as personal communication after the interview and allocated the code (6:pc). As noted previously the average level of attainment for each category is on a zero (very poor) to four (very good) indicative scale.

6.2 Interview Findings: By Coded EMM category 6.2.1 Energy Policy (EP) Very few codings were made (19 in all), evenly split between Europe, National and Local, were made for this category limiting its findings (see Section 6.3). In part, this was because few respondents gave clear responses indicating any focus beyond the headline targets.

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6.2.1.1 European Level A lack of clear, long-term European and National targets beyond 2020 and toward 2050 was mentioned (1:14; 10:22). The strongly stated, but not binding, energy-saving target (2:4) and legally binding emissions targets mandated by the ESD and EPBD European Directives and agreed to by Ireland was noted (2:10 and also 3:39). Member States and vested interests appear to have watered down the potential impact of the new EED that was to have addressed the shortfall in progress toward the energy-saving target (2:10; 2:6). 6.2.1.2 National Level At national level, policy objectives are strongly stated, though water and public lighting are elements currently overlooked by national policy (2:69; see also 9:79). Water is now beginning to be addressed by SEAI working in coordination with the CCMA (11:1). The declared policy aim in social housing is to upgrade them to a C1 rating but even before recent cuts in funding the likely outlook was that this would take 15 to 20 years so the target is much more distant now (7:17). 6.2.1.3 Local Level In local authorities, a lower EMM attainment level of stated energy policy is indicated by the responses. Noting current funding restrictions, an absence of set enforced policy targets for local authorities and their departments was reported (3:25; 10:63-64,76). Doubt that the targets can be met, except due to economic recession, was expressed, for example one respondent said: Theoretically, we are supposed to be saving 20% by 2020, the public sector was to save 33%. I do not know how. In a way we have been saved by the downturn because everything has caved in. (10:74)

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Local energy action plans do exist though not in every authority (2:14). Dublin’s Sustainable Energy Action Plan (SEAP) has been published but the DCC Housing Energy Action Plan remains unpublished despite much work (10:21; 10:20).

The

unclear housing policy means that retrofit projects are set up in an ad hoc rather than a systemised manner by motivated individuals who work to establish individual projects (10:10). The seven sustainability themes of the Dublin Fire Brigade Green Plan, each with results-based, sustainability objectives, are identified by Neil McCabe as critical to its success, and to its adoption by DFB as their business plan this year (13:4; 13:3). From now on, all decisions made by DFB will be framed by the Green Plan's themes and objectives. 6.2.2 Energy Management Structure (MS) MS codings were made when respondents referred to upper management buy-in, energy management systems, communication, or responsibility of delegation of energy matters. For the MS category, 87 scored codings were made with an average attainment level of 1 and 2 respectively for National and Local levels (see Section 6.3). The mode value was 1 in each case. 6.2.2.1 European Level Highly departmentalised systems are evident at every level of governance creating problems in setting up energy management structures due to ‘silo thinking’ and actions restricting integrated communication (2:25,27). In Europe, Directorates General for Climate, Environment, Energy and Agriculture all look at energy and emissions policy separately and largely communicate with the corresponding departments in Member States (2:70).

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6.2.2.2 National to Local Level In Ireland, Departments and public sector bodies are often isolated from one another (2:26) with departmentalised, silo thinking (11:27). There are also challenges for Departments and SEAI in addressing energy management issues in the local authorities due to the high degree of complexity in intermediate, local authority administrative structures relating to energy (11:2,11:6). These can be addressed well on a single-issue basis over time as, for example, in SEAI/CCMA work on water services currently (11:1). Requirements, such as Display Energy Certificates are not being complied with; they are not being checked by government agencies so they are not a priority (8:28). The DECLG are overseeing funded-retrofit works on social housing to ensure the limited funding (2:42) is well spent (7:11), but frequent meetings take place between the DECLG and Local Authority architects (3:31; 7:24,25,26,33) that can delay projects (2:44; 7:37) because negotiations often progress slowly (2:46) by being “presented in a case by case fashion” (3:31) or by persuasion on a “case by case basis” (10:43). The National Procurement Service, which puts out tenders for local authority energy supply, may lack the power or authority to press suppliers to meet public sector energy management data requirements (9:87). 6.2.2.3 Local Level – Energy Management Engagement Local authority energy management structures are at an early stage of development (9:76; 11:67) and more integrated structures are needed to manage energy at every level (12:27). Irish cities and counties have highly varied forms of energy agency that have many different organisational models. There are small 'in-house' ‘agencies’ like the two person one in Co. Kerry (11:7); the not-for-profit Codema in

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Dublin (that is not an integrated part of DCC) (8:42), and Tipperary agencies; some of which have closed down due to spending cuts, as in Meath (11:9); and there are some areas without any energy agency. Across Europe, local energy agencies find it difficult to establish effectiveness in improving public sector energy management (2:36). SDCC have engaged with SEAI Energy MAP for four years (9:7) and DLRCC have had an Energy Team for two years (3:1,5). In each of these counties, the County Architects have the title of Energy Champion (3:1; 9:1). Though SDCC is now actively addressing energy and emissions saving, previous efforts and reports have been sporadic and the results have not been widely disseminated (9:76). As energy costs have increased, management buy-in to energy concerns has also begun to increase (8:40, 9:78). Dublin City has shown strong support for the Green Plan work of Neil McCabe (13:2) but they have yet to engage with Energy MAP on any scale (8:pc.) and there appears to be limited upper management drive for energy and emissions savings (5:8,28; 6:41; 10:43; 12:37). DCC is an older and larger organisation and less easy to change compared to younger authorities like SDCC and DLRCC (8:30). 6.2.2.4 Local Level – Communications, Data and Technical Knowledge Good communications between and within DCC departments on energy matters were mentioned (4:24; 6:1), but generally systems for good communication on energy matters were frequently noted as deficient or lacking (2:24; 3:9; 4:7,11,34; 10:10,18,68; 12:2). Some good examples of energy management were mentioned, as shown by the accessibility of DCC energy usage data on-line at www.dublinked.ie (6:12). SDCC are similarly working on energy information transparency with a new website at www.southdublinenergy.ie (9:66). Lack of technical skills (4:4), lack of time (4:6) or resources (6:20,24), and limited authority for action (4:6; 6:2) were all cited as

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management difficulties in delaying or preventing energy-related decision-making. A reliance on key personnel with a deeper knowledge of energy management issues whose expertise may be lost to organisations when they move position or retire was mentioned in DCC (6:7,8,29,40). This was also noted in Irish local authorities generally as a current problem due to many retirements (11:17). A move to systemise knowledge has occurred in SDCC in the technical retraining of staff to be able to undertake BERs and assess retrofit possibilities (9:49). A breakdown in ‘partnership’ between management, unions and staff within DFB, initially made communicating the Green Plan very difficult and took three years to overcome (13:14). 6.2.3 Implementation and Motivation (IM) IM codings were made when respondents referred to the current degree of motivation toward achieving the policy objectives and the current level of energy management commitment. As in the EMM isolated or sporadic results were seen in the grading as indicating piecemeal approaches, even where positive. For the IM category, 247 scored codings were made with an average attainment level of 2 for both National and Local levels (see Section 6.3). However, the mode was 1 in each case. 6.2.3.1 European Level European Union projects continue to support energy-efficiency programmes in Ireland. The Minus 3% project, led by Codema in Dublin (2:19) tested the potential for 3% annual energy savings and achieved the target in the test year of 2011, reaching 6% savings (using modelled rather than measured and verified results).

Another EU

project, 'Re-Green’, though it is more about energy than other sustainability concerns such as water and waste, is a current InterReg 4, EU programme that DCC Architects

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are engaging with currently, primarily with the aim of looking at their housing stock (10:1,2). The level of deep building retrofit varies around Europe with exemplars being Germany, which has a large number of external cladding projects, and the Nordic countries, where there is large-scale use of district heating (2:52). In general, the implementation of energy management all over Europe and at different governance levels has had inadequate results: I would not point the finger at anybody, there are a lot of good people at local, national and European level, all in a way trying to do something good but somehow it is not fully connecting. We all have to put up our hands and say we could do better. (2:61) 6.2.3.2 National Level Nationally, there are programmes aiming to implement policy such as: the DECLG funded energy retrofit programme (7:1,3,40), with an aspirational target of raising all social housing to a C1 BER rating (7:4,5); and the SEAI-administered Better Energy Workplaces grant scheme, assisting local authorities to meet their 'glide-path’ to the target from a defined baseline (11:26). The DECLG programme's annual funding continues to be severely cut with a 58% cut over the last two years – from €43 million in 2010 to €34 million in 2011, and down to €18 million this year (7:3). Although limited in scope (7:8,15; 10:27) and only funding the ‘voids’ (social housing units that become vacant), the DECLG programme implements a policy of not re-renting F- and G- rated houses (7:29; 10:32). One result of only doing voids is a lottery effect in that one tenant might get an C-rated dwelling next to still-occupied G-rated ones for the same rent (7:17). For larger retrofit or newbuild projects, DCC and other local authorities rely on specific negotiated monies or

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have to bid for funds from Government grant schemes from multiple funding routes (7:16), rather than budgeting from their own funding as a result of the highly centralised form of governance in Ireland (10:46, also 2:47). SEAI have developed Energy MAP to engage the private and public sectors in their own programmes of energy management change (11:10) and so far about 21 or 22 of the 34 local authorities have engaged with it (11:12). Efforts to involve energy suppliers (“obligated parties”, see 11:48) are beginning. They are being linked on-line to local authorities as possible ESCo service providers through “EnergyLink” (11:16) although this process is at an early stage (2:64; 10:6). The ISO 50001 international standard of energy management, only currently used by UCC and the Defence Forces, is seen as an exemplar level that bodies completing Energy MAP can aspire to (11:11). Energy saving or cost saving, rather than carbon saving, are very much the focus of current efforts by government (7:30; 1:18; 9:10,73). There are no implemented carbon commitments as there are in the UK (9:52) despite the latest forecasts showing that the emissions targets will be missed (2:10,11). An absence of enforced carbon targets reduces the level of ‘push’ on public sector bodies (1:10; 9:53,54) but energy costs are becoming a strong driver for savings, due more to the economic downturn than to policy implementation (9:74). There is some doubt as to whether the EN1 form for reporting energy consumption is now required by DECLG (5:41). In Ireland, a past tendency to focus on technological pilot projects can be identified, often additionally pushed by grants (9:93). A 'fabric-first’ approach, using passive insulation and air-sealing measures, would be more robust in the long-term (1:20; 9:94). There have been high achieving, local authority area retrofit projects, notably in Tralee (7:35; 9:90,91) and Dundalk (10:8), though not on a broad scale (1:11,12).

Kerry County Council are noted as having done very well in having 74


retrofitted most of their vacant stock and are now looking at retrofitting a number of estates following on from the finished project in Tralee (7:36). Generally, the work in Tralee has been practically focused on establishing a "virtuous circle”, motivating local people, creating local employment and implementing behavioural as well as technical solutions (9:92). In the public sector, the OPW have now installed building monitoring in many of their buildings (11:21) as well as a ‘bureau-style’ technical service, so that motivated building managers and users can call for energy saving advice, yielding high returns in savings at low cost (11:25). 6.2.3.3 Local Level: Organisational Motivation and Change In local authorities currently, motivation toward energy savings is affected by poor billing and meter data, making it difficult to confirm usage if unexpectedly high bills are received (4:12; 6:12). Codema, as the energy agency for Dublin City, are assembling a Microsoft Access-based database of all Dublin City energy accounts keyed by unique location numbers, accessibly storing information from energy bills and surveys of buildings (8:11,13,20). It is a complex undertaking requiring large amounts of data collection and checking (8:20,46). Codema's survey audits are continuing and to date these have proceeded by building type: Fire Stations (13:42), Libraries, Depots, Motor Tax Offices and Leisure Centres (8:11). They are also surveying buildings for SDCC (9:19) and Fingal County Council, and the plan is to ultimately survey all council buildings regardless of size (8:9). Students on work placement have been undertaking these surveys (8:8) but the aim is to have a graduate engineer for future surveys so that the DEC ratings produced can be officially certified (8:10). Codema’s aim is to work “from the ground up” when working with DCC departments on energy projects rather than from a position of authority (8:43). Codema were described, uncertainly, as a source of 75


energy saving initiatives (6:33) and information (13:34,35,36), but their resources and scope were described as somewhat limited (9:81; 10:44). In the manager in overall charge of DCC Leisure Centre,, out of his own personal interest, has been attending a three-day energy management workshop (4:4-5). In SDCC, there is a monthly meeting of a committee looking at energy efficiency (9:20). A register of energy saving opportunities has been produced (9:18), and a heat map of Tallaght is being used to identify supply and demand for assessment of district heating potential (9:26). The county has a total housing stock of 9,200 houses and two areas of social housing, North Clondalkin and West Tallaght, which have been categorised as suffering from deprivation (9:4). Before the economic crisis of 2007-8, the SDCC annual capital budget was about â‚Ź60 million and many new civic buildings including leisure centres were built. After 2008, with little new work in prospect, the county's clerks of works were retrained as BER assessors (9:11) looking toward retrofitting of buildings. Having carried out many BERs and cross-referencing with published [SEAI] information, it is expected that within about six months there will be a better understanding of the BER-rating spread of the housing stock (9:34,36). The aim is to go beyond retrofitting alone, to increase the information circulation and reduce fuel poverty (9:37). In Dun Laoghaire, a steep learning curve was noted as being required to track down consumption and cost for individual properties, using bills and collected meter numbers (3:4). In the Dublin area, the amount of significant retrofit, other than social housing void upgrades, has decreased to a low level with only a few projects being mentioned (2:65; 5:39; 10:3,4,30).

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6.2.3.4 Local Level: Motivating Behavioural Change Responses did not indicate that any results-based behavioural change programmes within departments other than Codema’s Switch-Off Campaign were occurring or planned.

Nevertheless, motivating behavioural change was mentioned by several

respondents as being important in addressing change toward good energy management, for example: Who decides what the level of the bill is; it is really the staff (12:14) In all three authorities, public awareness (9:66,67) and communication with the residents of retrofit projects was identified as important, both in the retrofit process and in understanding monitoring or use after retrofit (3:17; 9:37; 10:62).

Similarly,

motivating staff to save energy is seen as very important (3:6; 12:4,35; 13:8) and Codema's Switch-Off Campaign was mentioned (2:20; 3:6; 5:31). However, outside DFB, implementing behavioural change was reported as being difficult (9:77) or slow (12:24,25). There have been a number of significant difficulties, particularly a lack of readily available behavioural or technical advice (4:29,32,35,43; 9:69; 10:81; 11:41; 12:36) but there are no plans to extend the OPW's so-called bureau-style technical advice service because of cost constraints (11:22). ESCos could provide such a service in future as part of their contract, if the ESCo funding model becomes more commonly used (11:41). One respondent identified self-motivation, obligation and incentives as alternatives for motivating behavioural change (12:29). Obligation was identified as an important driver (10:77; 12:6,7) needing firm policy requirements; and the possibility of financial incentives was mentioned – possibly part of the savings might clearly be identified as then going toward improving the facility where staff work (12:30).

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In DFB, after spending two years developing the Green Plan in his spare time (13:1), Neil McCabe identified community-linked behavioural change as a core, ethically and morally motivated principle (13:18,45) to be additionally motivated by intentionally visual projects in the initial phase at Kilbarrack (13:17): Everyone talks about the technology I have invested in but the reality is that I did everything else first. When I had the behavioural side changed, the renewables side of it was as a solution, and not as individual products (13:45). McCabe has written extensive guidance documents for DFB advising on behavioural, technical and procurement management (13:22). The term ‘energy champion’ was used in different ways by different respondents. In South Dublin and Dún Laoghaire, interviewees immediately volunteered it as a particular upper managerial position (3:1; 9:1). The local example of Cormac Healy at Poppintree (12:15,31) was identified as a possible precedent for establishing each of the leisure centre managers as a local energy champion (4:5). A view from two respondents was that, although locally valuable and highly motivated, local energy champions and projects usually have a very limited overall effect in comparison to improvements made in wider scale management structures and programmes (2:65; 11:66). In the locally instigated project at Kilbarrack the firefighters are leading both organisational and community change (13:3,13) benefiting from Neil McCabe’s Green Plan work and guidance. One respondent said of McCabe: He is a great genius in his own way. He has a very clear, simple understanding of what has to happen. It is an amazing achievement

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starting with one guy. The way he has brought in older retired guys and local children; he has an innate understanding of sustainability (9:89) 6.2.3.5 Local Level: Retrofitting Technical guidance for retrofits is about to be published by the DECLG (1:17; 10:26). Retrofits need to be deep to avoid having to revisit the building (1:16) and are best achieved on an area basis (1:16) as in the exemplar case of Tralee (7:35; 11:7). Area retrofit is at very early stage of consideration in Dublin City (10:19). Detailed technical reports have been made from past projects on how to make savings, like that for the Minus 3% project (2:16). Dublin’s council areas differ in their history and building mix: Dublin City and Dún Laoghaire have older buildings compared to South Dublin and Fingal which generally have newer civic buildings and housing (9:64). SDCC are looking at the potential for district heating and CHP in Tallaght utilising, and potentially linking, the heating and cooling loads of the Civic Offices, the Square shopping centre, Goodmans food, the hospital and likewise in large data centres, possibly by means of a council-run ESCo (9:26-27). The facilities manager in the DCC Civic Offices is making progress toward re-instating rainwater harvesting and installing photovoltaics (10:67). In the leisure centres, the ease of access to building controls was stressed. All main lighting switches are ideally located at reception (12:34) and BMS control laptops have to be easily accessible to facility managers, so that they are easy to use to match heating to timetabled room usage – currently they are not easily accessible in some centres (12:5).

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A slow pace of retrofit was described in Dublin City (7:37) although deeper retrofit is designed in where possible (10:45). Given the history of new-build projects, there is a relative lack of retrofit experience among City Architects (10:47) and a lack of in-house technical knowledge of retrofit analysis software (10:54).

Expert retrofit

analytical advice was sought for retrofit design in pre-crisis years, as on the Glover Court’s gullwing flats, but is now less likely to be engaged due to cost constraints (10:60) though it may be needed (10:53). This is also the case in SDCC (9:69). Piecemeal measures such as drylining of individual units in retrofitting terraces and flats were identified as normal current practice (7:19,28; 10:52,60), even though the knowledge that external insulation was a preferable and superior retrofit solution was clearly stated by respondents (7:19,36-37; 10:29,50). Lack of funding (10:30-31) and lack of motivation (7:37) were both cited as reasons for not cladding externally – for example on apartment blocks like the 'gullwing' apartments and Dolphin's Barn's flats. In Dolphin House flats, there may be a slightly increased risk of condensation in the un-retrofitted flat neighbouring a flat that is retrofitted with internal insulation, due to a cooler shared internal wall junction with the exterior wall (10:53). Glasgow was able to carry out external insulation on a large scale (7:37-38) despite tenancy-ownership issues. This would not be an issue in Ireland because local authority apartment buildings are fully owned by the local authorities simplifying such a potential program of external cladding (7:39). A need to identify durable, technical solutions for active measures in houses like fans, vents or heat recovery ventilation was expressed (9:40), with the proviso that they all require regular maintenance, filter changes and inspection. For social housing though, these could be combined with the annual boiler and smoke detector inspections (9:39).

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In DFB the technical experience gained by the Green Plan has included research into the component parts of technical retrofit measures providing investment data on facts, prices, carbon emissions, and water and energy reduction. (13:21). A trial of new technology affecting the DFB fleet has been implemented that is likely to yield savings of 11% in fuel and 19% in carbon emissions (13:36). 6.2.3.6 Local Level: Management Commitment and Funding Potential Energy costs are becoming a driver for upper management to buy in to changes toward energy management (5:36; 9:50,54) as financial resources have reduced. Generally though, public buildings and housing have been worked on as they are seen as needing repair, with some energy upgrading, but not with a management or funding commitment to longer term, deeper or rolling retrofit solutions (2:54). Operational budget reductions are now restricting implementation of energy measures such as monitoring and energy usage audits and surveys (4:21; 9:48). However, SEAI are pushing for more audited measurement and verification in future (11:37). Councils rely on European and Government funding for their energy programmes such as LEAP, ReGreen, the Sustainable Energy Community Programme, as they do for supplementary programme funding generally (9:67). The economic downturn has led to an even slower rate of building replacement and retrofit in the local authorities (9:31; 10:83). The need for savings has led to decreases in energy use but only at about the same rate as energy costs are rising, so the overall bill has remained much the same (5:33). Grants like those from SEAI can only provide 'pump-priming' (2:50; 10:36) and application preparation times may be large in proportion to the small amounts of grant funding available relative to overall council budgets (11:42).

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SDCC have found that promised grant funding from SEAI can be very slow to arrive, delaying implementation of measures (10:55) and grant application and closing deadlines cause significant implementation difficulties (9:56). The market for private funding for public retrofit or energy management is at an early stage of development (10:9; 11:18) because there is a lack of expertise in investment assessment leading to management uncertainty over the potential gains (11:64). DCC have been talking with an investment company to establish an energy investment fund, but as yet no clear timeline has been set for it to proceed (10:40). Moves toward involving energy suppliers are not yet underway either (10:17). One respondent described motivation of the public sector toward achieving the 33% energy savings as poor: They have not really started the road map to actually achieve it. It is just a figure, there has been no real effort put into how they are going to do it. (1:10) 6.2.4 Investment and Cost Analysis (CA) CA codings were made when respondents referred to the current budget constraints, retrofit planning, grant funding or investment cost analysis methods that affect the future usage of energy or emissions of carbon dioxide. As in the EMM, energy cost control concentrating on price alone, on low cost/fast payback requirements, or using simple payback appraisals, were ranked less highly than cost control and planning using on-going portfolio and integrated investment appraisals that rely on rationally-decided, value-driven objectives. Isolated or sporadic results, even if good, were seen in this grading as indicating piecemeal approaches.

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For the CA category, 135 scored codings were made with a low average attainment level of 1 for both National and Local levels (see Section 6.3). The mode value was 1 in each case. 6.2.4.1 Budget constraints Public sector budgets in Ireland largely rely on single financial year accounting, restricting all government bodies to spending only the monies allocated for the current year (2:57; 11:43). Such constrained grants militate against longer term, deep retrofit projects (2:58). Larger building and infrastructure projects often have five-year capital budgets, but there are currently few such projects occurring (3:10; 5:37) and these are not commonly used for retrofit projects (5:38). Capital budgets are held separate from current spending and any savings made in a year’s current spending budget must be spent by the end of the year, they cannot be ring-fenced to provide future capital or operational spending (10:72). Illustrating this, a DCC community centre was built for €3.5 million and the capital was found with little difficulty, but the annual operating cost of €300,000 was much more difficult to agree (10:73). Local authority accounts are monitored on a quarterly basis, to be scrutinised by the DECLG, and also now for the IMF (5:32). Current spending is consequently highly restricted (6:37). For SDCC, this year's current funding from the DECLG was reduced in August by €1.9 million because of a shortfall in household charge collection, which will have to be saved out of the remaining operating budget by November (9:60). This effectively stopped all maintenance operations and reduce the scale of individual retrofitting. DECLG have told SDCC to cut re-wiring from standard refurbishment works as a result of the funding cuts (9:61,62).

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Dublin did have household rates previously until rates were abolished in 1987 (2:49) but a large part of the income for Irish local authorities now comes from rental and grant monies (7:38). Before the financial crisis revenues from new build site fees were large (2:49-50). Money was also brought in from selling housing, and in DCC this was largely spent on housing refurbishment but this revenue source is now closed (10:38). The financial situation means that very little borrowing is currently occurring and relatively few capital projects are now in progress (5:40). Local authorities often have to be creative to obtain funds, bidding in combination with other groups to meet partnership rules for particular programmes (9:41). Sourcing funding for the authorities can be complex, flowing from different government departments and through schemes that change on an annual basis (2:48; 10:14). In other countries, local authorities have more control over their own budgets, for example: In Birmingham [recent winner of the World Green Building Council award], they have their own budgets that they can allocate; the problem here is that the local authorities cannot and that is the big problem in Ireland. The local authorities only have the discretion to bring forward projects that are then dependent on the approval of the Department of Environment to carry them through (1:9) In Dublin City, the energy spend in 2006 was â‚Ź22 million (Minus 3% project figures) including water and public lighting (8:1). Within DCC the staff and running costs for each building are allocated to a 'cost centre' in the accounts (5:3). Department managers are responsible for their own cost centres, so they have to monitor and control their own costs including energy costs (5:8) though they may find it difficult for energy usage in the absence of billed consumption to check the costs incurred (4:10). 84


For the leisure centres, the yearly operating budget is for daily running costs and if unexpectedly large costs arise they have to be saved within in that budget (4:20). The budget has become tighter in the recent years so that adding to sinking funds (making savings from the current year to allow for eventualities next year) is very difficult: “it is done almost in error rather than in a planned wayâ€? (4:20, see also 9:59). A recent large cost was receiving an unexpected arrears bill for â‚Ź50,000 from an energy supplier, this amount then immediately being taken out of the cost centre account for Ballymun Leisure Centre. Due to the hard copy bill being in the Finance Office and being timeconsuming to locate and read, it has been difficult to substantiate the related consumption (4:17,46,47; see also 2:35). Tight departmental annual budgets mean that monies, and technical or investment appraisal advice, are not available, even for low cost retrofit upgrades which are sometimes offered by suppliers at low or no initial cost on an ESCo basis with guaranteed overall savings compared to current energy bills (4:25,26). 6.2.4.2 Retrofit Planning and Funding Since the 1990s, larger social housing upgrade programmes in Ireland, funded by Government grant aid, have been carried out by local authorities installing particular measures in schemes including replacement windows, draught stripping, and attic insulation (9:28,29). It can be difficult now to identify the houses where this has been done and efforts are being made to map past retrofits to establish which measures were installed where (9:30). Despite the government energy and emission targets, the diminishing budgets available from the DECLG and from the DCENR through SEAI for retrofitting are likely to greatly restrict progress toward achieving them (7:21,32). The limited funding

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available for social housing (7:8,15) means that a programme of large scale retrofit will not occur in the current budget environment (7:28,29). The DECLG, provide the funding for social housing energy retrofits and were reported to receive monies from the DCENR for a third of the carbon savings (10:14). Like other annually released grant monies the DECLG funding brings time constraints. In Dún Laoghaire, to retrofit a building for the elderly, health and safety concerns, contractors and external consultants had to be in place in order to start on site in July and have the works completed in time for post-works BER assessments to be submitted in mid-October for the council to draw down the funding (3:32,34). For the 27,000 housing units owned by DCC energy retrofit monies are supplied by the DECLG: A lot of the control, management and funding comes from the DECLG and the Council is more a manager of that. There is an idea that the Council has total responsibility if the flats are run down. It is as much a reflection on the Government as it is on the local authority, even more so. (2:45) An example is the Dolphin's Barn flats that have had serious damp and mould problems for years (10:48,49). The flats are now undergoing a rolling program of piecemeal retrofit of the most seriously affected flats, "probably funded by way of special pleading to the DECLG”, with a possible regeneration beginning in about three years time – in 2015 (10:50). In local authorities, investments in retrofit measures in the highest consumption accounts, usually Water Services, Public Lighting, and larger buildings, can save very large amounts of energy – a high Pareto effect that SEAI hopes to help them address in

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a structured way with Energy MAP training (11:13). This year’s SEAI Better Energy Workplaces grants are not intended to fund projects that are already financially viable: If a grant was given on purely financial terms you would not need a grant, because if this building showed a 20% saving say, and it would pay for itself in three years, why would you want to grant-aid that? To give a grant toward that is probably a bad appropriation of public funds because they should be doing it anyway, you should not need a grant to do something that is commercially viable. Grants are brought in to incentivise something that is not happening in the marketplace. (11:45,46) In grant application reviews, private sector applicants are vetted as to whether they really need the money, this is less so in local authorities where budgets are tight and the money is always needed (11:60). Applications were judged on the basis of seven criteria including employment provided and new forms of procurement mechanism (11:61-62). The involvement of energy suppliers or ESCos was encouraged but very few, or no, local authorities applied in this way, partly because ESCo funding is considered to be debt on their accounts (11:49). Another aim of the grants is to encourage retrofits that include multiple project elements and/or involve many sites all carried out by one applicant (11:52,53). Nonetheless, in grading the applications there are "a lot of marks for the financial business sense" to ensure that it is a replicable project (11:61). The annual timeline of grants, funded by Government and the EU, is very tight.

The rules and guidelines for each year's project are usually different,

delaying applications that will then also have to be laboriously evaluated, producing “a strong administrative burden� (11:44). If approved there are usually only a few months for applicants to confirm and procure the project. This means that: 87


For the SEAI grants the timeline can be such that the grants are open for application at the beginning of June and they expect the works to be completed by the end of September and the verification carried out. So that timeline is such that you are dependent on grants being available, but you are supposed to have your ducks lined up in a row beforehand. A lot of work may have been expended and maybe external consultants retained to get various things to get the grant, which may not even go ahead or it may be changed or tweaked, or your project may not be deemed acceptable. (10:32) In Dublin Fire Brigade, the Green Plan is now at a stage where the ring-fenced funding produced by the significant retrofit savings at Kilbarrack, verified by SEAI, are now funding further retrofit without the need for further grant funding: It is self-generating.

It is money that did not exist and the most

important thing from the ring-fenced saving fund idea is that, say at the end of this year 2012, we have all the savings from Kilbarrack plus all the savings from Phibsborough now in the one pot ready to go to the next fire station. Already that fire station has been chosen as the Fire Brigade's workshop, the garage in Stanley Street, where we service all of our vehicles. That fire station/workshop has already undergone part of its transformation before the year is even finished and I am still not even asking management for money. (13:10) By establishing monitored baseline results the DFB intend to go to the private market for ESCo or PPP funding with a good knowledge of current consumption and performance (13:26).

The technical and investment research carried out by Neil

McCabe, as well as M&V reports, will allow a more informed judgement to obtain the 88


best value from offered investments (10:35). Onerous ISO 14064 auditing has also been satisfied, allowing carbon credits for the retrofit savings achieved to be sold, providing further revenue for the retrofit fund (13:43; see also 1:7; 10:66). 6.2.4.3 Retrofit Grant Funding One of SEAI's aims is to lengthen investment periods to five or ten years, ideally through the use of ESCos, and avoid funding applications that are just looking for quick paybacks (11:53). SEAI offered some workshops at the beginning of the BEW scheme but applicants are not given any particular guidance on the lifecycle to be considered in calculations (11:56). Life cycle costing concepts were noted as, "only just starting to come in" so applicants were not using those methods for their applications (see also 11:57). In BEW applications sub-projects submitted were allowed to pass with only the investment simple payback filled in but applicants were given a few more marks if they entered a Net Present Value amount (11:55). At the DECLG, the proposed housing retrofit programs are funded on the basis of achieving upgraded BER ratings above an F-rating. An improvement in excess of 300kWh/m2.y would receive 90% funding per dwellling up to a maximum of â‚Ź15,000; the next band down is above 200 kWh/m2.y; and some funding is available for improvements of more than 50 kWh/m2.y (7:10; 10:27). BERs are required before and after the retrofit. The pre-works BER is used as a basis to assess each measure in an assessment spreadsheet to give an estimate of the payback before proceeding with works (7:12). This spreadsheet calculator, made by the DECLG, has been issued to councils for them to do a cost analysis of measures (7:13). Ideally, a payback of fewer than 15 or at most 20 years is acceptable (7:22). In some cases, not using this design support tool led some

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councils to invest in measures that did not upgrade the BER rating and failed to obtain the funding (7:27). Some BER assessments seen have very large 1200 kWh/m2.y energy use [a G-rating is for houses using over 450 kWh/m2.y] showing the need for upgrading works (7:27-28). The DECLG architects offer general advice and guidance toward carrying out the most cost effective and beneficial measures, so they do not check detailed designs. They provide an overview, comparing retrofit costs between councils on the basis of euro/kWh.m2.y improvement, an example shown resulted in retrofit costs of â‚Ź31/kWh.m2.y (7:31). 6.2.4.4 Investment Cost Analysis in Local Authorities While binding targets are not yet in place (2:55), they would force investments to be made but currently there is no funding to meet them (7:31-32). Local authorities have generally not done cost analysis of energy related costs because energy has been seen as a relatively cheap overhead (8:41). However, energy costs have risen rapidly in recent years (8:37) so that making savings has become important (9:47,68). In retrofitting public buildings, as at Crumlin Swimming Pool, repairs are prioritised but energy upgrades are not a main focus (10:5). The economic crisis has made current investment payback time horizons as short as a couple of years (2:56; see also 1:4), even though a reasonable time horizon for a building appraisal might be 30 years, with about 15 years for elements such as heating systems (2:77). Deep retrofits may have longer paybacks but also have significant, wider, ‘public good’ benefits such as healthier, more comfortable public buildings and publicly owned social housing (1:5,6).

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Councils currently see simple payback as the primary appraisal measure as it is the metric used by DECLG grants (3:25-26; 10:70,71). However, even fast payback / long service life items, like pumping cavity walls with insulation, are not being sanctioned now because they require initial investment and organisation (6:34; 10:41). LCC on longer periods was noted as being potentially complex, which might be offputting, but it would be a good start if it became required standard practice in all public building assessments (1:1,3). The gullwing flats in Dublin are sixty years old so: You could argue they have paid for themselves so you could demolish them, but also you could extend their life. Demolishing and rebuilding would cost €10 million for Glover Court, just as a rough idea, and our €3 million [retrofit] job would have enlarged the flats a little bit as well… (10:31) LCA (not LCC) was noted as being too complicated by another respondent (3:26) and cost saving analysis instead is aimed toward the DECLG guidelines based on individual measure paybacks and BER targets (3:22,27,28). Lifecycle 'demolish or retrofit' decisions on older houses and buildings are not being made when considering the existing stock (10:82) and planning for the long-term uncertainties such as fossil fuel availability is not being done (10:80, see also 1:15). Budget constraints mean that life cycle costing on terms of over 20 years is not possible now for local authorities: You cannot do it. You cannot even plan for the age of the stock over a longer arc. Anyway we will see how it goes, this is all a function of the moment; it was not like that before, so we will see. (9:63)

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6.2.4.5 Investment Co-Benefits and Energy Billing Data Current cost analyses do not take into account potentially large co-benefits of retrofit such as health or comfort that could address fuel poverty (3:15; 9:35) though it is known that there are studies showing significant resultant health savings (1:6,18,19; 10:61,68,79). This could be because it might be "quite a difficult thing to achieve or to monitor" though it is clear that feedback following a retrofit of elderly social housing showed that there was a “substantial improvement in peoples comfort conditions that was an integral part of our work� (3:15-16). Social housing can be very poor in quality, but the councils have no financial incentive to improve dwellings because it is the tenants who pay the energy bills and if a dwelling is improved the rent paid does not increase (10:11). DCC departments find it difficult to obtain energy data to establish baselines, against which to judge savings, because energy consumption amounts are not easily available being only printed on hard copy bills, whereas the costs arrive in digital form without attached consumption data (4:16,17; 5:16,22).

Councils lack expertise in

investment appraisal of retrofits (10:39) and have a limited leeway in budgeting: The big problem though is that capital budgets are separate from current spending so that savings in current spending do not end up being available for capital. It is quite often a problem (10:72) Due to cost, specialist advice is not being sought in retrofit investment decisions (10:84) and experimental projects often carry higher risks leading to higher costs (2:76). Neil McCabe has had no specialist advisors to assist with investment planning (13:19) for the Green Plan so over three years he carried out detailed technical research to establish source selection criteria, potential savings and lifecycle costs for possible

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retrofit measures (13:20) – the resulting information is about to be published as Green Public Procurement and Investing in Climate Change (13:22). 6.2.5 Monitoring and Targeting (MT) MT codings were made when responses referred to: any energy saving or carbon emissions targets (meeting the headline target or any intermediate/departmental targets); monitoring or metering of buildings; or to data analysis and reporting. For the MT category, 99 scored codings were made with an average attainment level of 1.5 for both National and Local levels (see Section 6.3). The mode was 1 in each case. Looking at targeting alone, 18 codings were made with a mode value of 0. 6.2.5.1 Targets Delays in achieving energy saving targets in buildings are likely (2:62) as there will be no strong push until firm figures are available (8:44), and it is likely that Ireland will in any case have to buy carbon credits in order to meet its legal obligations (2:9). The overall 33% energy-saving target has yet to be connected with what is happening in the public sector (11:68). The targets are essentially meaningless because there is a large amount of uncertainty in the current baseline data due to a lack of reliable information and different estimating methodologies (2:21,37). This means that it may not be possible to know when the target has been achieved (9:75). One respondent stated: I do not know if they will really be able to hold anyone accountable to the figures because they are not robust enough at all yet due to so many uncertainties. Even for the stuff as simple as the actual utility bills there is so much uncertainty. (8:45)

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Disaggregation of the overall target figure, so that it is budgeted at each level for councils, departments or facilities, is at an early stage of consideration (11:65). There is also a need to keep track of the interdepartmental aspects of reaching the 33% target (11:27), but no such accounting for variable achievability is currently occurring (2:29,34,68; 4:38; 6:37; 10:64; 11:64; 12:44) and no mention of annual targets was made by respondents. It may be best for targets to be set at building and facility level if they are to be meaningful, so avoiding the segregation problem of separating the target among departments (2:72). 6.2.5.2 Monitoring and Metering At national level, SEAI have recently collected 30,000 MPRNs and GPRNs so there will be a much better estimate of public sector electricity use, but there are still reporting gaps (11:32). In the recent SEAI/CCMA report, local authority energy use is divided into Water Services; Public Lighting, and Unallocated, which includes buildings (8:2). In Dublin, there have been problems in locating and reading some meters (6:11,27) and gas meters have been hard to check with Bord Gåis (6:13) but most have now been captured (6:15). Collating meter numbers and MPRNs over the last two to three years enabled the council to find meters where bills were being paid in unused locations and savings have been identified (6:26,31,36). A display screen showing live meter readings of the Civic Office’s energy and water usage has recently been installed in the lobby area of the complex (4:40). Automated monitoring of the Civic Offices is now in place (2:40), but generally very little metering or sub-metering is occurring in buildings (3:7) and a great deal more needs to be done in verification of savings (2:29,30). Funding for monitoring is currently lacking (11:38) and would have to be paid for out of operating revenue funds (4:21). There is often a large gap between the 94


design specification of facilities and the actual performance in practice but often no allowance is made in budgets for follow-up performance verification: There is not much connection between capital and current accounts. It would be much better if there were. So you can get money for capital investment, but it is hard then to get money from a current account to run [M&V] on a day-by-day or week-by-week basis. (2:75) Modelled rather than measured and verified figures are often being used when reporting savings (2:74; 10:57) and these have built-in uncertainties so IPMVP is probably needed to increase accuracy in verification (11:38). Agreement has been reached with the residents of Dolphin House to install energy and condition monitors to verify performance after retrofit. (10:56). Monitored sub-metering in public buildings would be ideal but, currently, monitoring of incoming metering will be the easiest to achieve but there are delays in implementation (11:39). BMS systems are commonly designed to work with automatic logging systems but these have not been installed and would cost money to monitor (2:40; 3:38; 9:46; 11:24). One respondent said: I think we have to somehow start getting into a different world. Even the BMSs, we cannot read them and we do not know what is going on. We have to find ways so that there is real monitoring and control. (9:95) External technical expertise in monitoring has been successful recently in making savings, such as locating and addressing air loss at the civic offices recently (6:35), and has been usefully consulted in the past for other projects (10:58). In the leisure centres there is no automatic monitoring installed (4:30) and specialist advice would be needed if they were thought to be required (4:21,30). The only leisure centre meter reading known to be occurring is in Poppintree Leisure Centre,

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by Cormac Healy, the Duty Officer there (4:5,16; 12:8). There has been a lighting audit at Ballyfermot Leisure Centre recently with a recommendation not to replace lamps until required by the light level and then put in LEDs as necessary (4:28). In DFB, a high quality BMS system with monitoring has been installed in Phibsborough Fire Station and it was recommended that every fire station should have one (13:27-28). At Kilbarrack, work was required to get around not installing a BMS, the cost of which helped to justify the measure in future retrofits (13:27). Flowmeters are being used at Phibsborough and Kilbarrack to monitor rainwater and wastewater (13:31). However, there is no national or local system of water metering so there is no push to do this monitoring other than the ethical push from the Green Plan (13:30). A two-year project, flow monitoring the pressure and volume water usage of a fire engine has been carried out, which may well change the way firefighters use water to fight fires (13:34). A large energy trial, funded by Green Plan savings, is happening across three DFB locations and is being independently monitored by SEAI using IPMVP standard M&V (13:25). 6.2.5.3 Housing and Public Lighting There is a clearly defined target of a C1 rating or a 200 kWh/m².y improvement in BER set by DECLG although funding only allows upgrading of voids and there is no deep general retrofit policy (7:7,17). Both pre- and post-works BERs are required to verify the baseline condition and the retrofitted condition to qualify for grant money (7:12,17; 3:13,37).

In SDCC since 1999, fabric and heating systems have been

upgraded in social housing including, out of 9,200 houses in total: 2,000 cavity wall insulations; 2,800 heating upgrades; 900 double glazing upgrades from single glazing (9:11-12). Based on BERs the estimated average energy saving for renters is 37% (9:25).

In Dublin there is some sample information on the social housing stock 96


estimated by Codema based on BER information gained by work done on voids (10:78). More transparent reporting and accepted comparative indicators of housing energy and carbon emissions performance would help comparisons domestically and internationally (9:67). The Public Lighting electricity supply is unmetered and therefore unmonitored (8:3; 9:79; 11:28) and existing metering systems are unable to read ‘virtual meters’ that can now be installed in street lighting (11:30). However, large energy use cuts in Public Lighting and Water Services as well as buildings are needed if the policy targets are to be met (2:67). 6.2.5.4 Data Availability, Accounting and Analysis Many councils nationally lack rigorous energy data reporting or monitoring (11:15,23,33; also 8:5) and in some cases it may take three or four years before it is more complete, though a high percentage of it is now available (11:27). Much more energy data is being required by SEAI from public sector bodies this year so that the energy in total usage across all fuels will be known and showing whether they are on track to meet the 33% target (11:34). DCC corporate services have been collating total energy consumption for the whole council since 2010, by obtaining figures from the council departments (6:2,32; 8:6).

DECLG have said this reporting is no longer required but DCC are continuing to

collect the data (6:4,5); in SDCC it is thought to be still required (9:51-52). The EPA carbon management tool is in use by DCC to collate data (6:30) but carbon emissions are not reported in the Annual Report (6:28). There are still gaps and approximations in the data, in part due to different bill payment centres in addition to the Finance Office (6:14), and data has to be typed in with reference to paper bills making data collection

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and processing slow (6:23).

Currently there is no cross checking with the Finance

Office of the entered consumption figures against the corresponding individual or overall cost figures (6:22). Many of the indicators used in reporting councils’ energy usage have large, in-built uncertainties (9:21). In the leisure centres there is a strong awareness of energy usage because it adds up to about 20% of running costs in many cases, and because energy efficiency and the environment are concerns important to DCC (4:1,2,3). At Poppintree Leisure Centre an initial baseline of energy usage has been established and comparisons between present and past readings are now being made (12:21). At Kilbarrack Fire Station, the Green Plan financial savings have been verified by DCC and the energy accounting has been stringently audited to comply with ISO 14064 standards (13:43). 6.2.6 Data Provided by Energy Suppliers (PD) PD codings were made when responses referred to the data quality or the ease of data availability provided by energy suppliers. For the PD category, 28 scored codings were made with a low average attainment level of 0.9 (see Section 6.3). The mode values were evenly counted at 0 and 1. 6.2.6.1 Energy Supplier-Provided Data DCC energy supplies have been arranged through the National Procurement Service since about early 2011 (5:1) and there are currently about six energy providers (6:18) in all, not including Public Lighting which is a large and specialised account (5:2). Most providers send both soft copy (digital bills) and hard copy bills in to the Finance Office in different formats and on a variable basis, often monthly (5:1,4). The Finance Office only looks at the financial costs, including energy bills (5:7-8); Codema 98


and Corporate Services look at consumption to some extent (5:18). Supplier billing is focused on money so the soft copy data gives a cost and an meter reference but does not give the associated consumption figures (5:22), which are located on the hard copy paper bill (5:16) and cannot be easily interrogated, requiring manual processing making it comparatively useless (5:22; 8:18): “The utilities are not supplying the kind of data that would be valuable for an energy manager” (2:39; see also 6:18). A requirement to provide all location, meter reference, cost, and consumption data in a specified soft copy format from all suppliers would be very helpful but is unlikely to happen without a change in procurement rules to insist on consistent data as well as lowest price (5:29). Currently, Energia provides good, though slow, on-line access with costs, consumption and charts exportable to Excel; Airtricity has limited on-line access, it did have only cost data but is now improving; and ESB has some on-line management but data does not seem to be obtainable on-line (8:18). There is a need for consumption accounting but it is too problematic currently, given the data difficulties (5:19,28; 8:29). For example (5:26; 4:2,14,17), for the leisure centres manager to know the energy use for nineteen buildings in the year in that department, each building’s energy use would have to be located in six or twelve composite hard copy bills, some of them six inches thick, listing other buildings also, and there may be five or six different suppliers. It is easier for the managers to try to obtain the information directly from energy suppliers rather than from the Finance Office (5:27).

In Poppintree, the Duty Officer has arranged access to the centre’s gas

bill by contacting the current supplier (12:10), but getting access to the electricity bill from a different supplier has been difficult, and as yet unsuccessful, in spite of repeated emails (12:12).

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The difficulties with data from providers and changes of suppliers due to new tenders adds considerable administration time, complexity and costs for the Finance Office and for department and building managers (5:18,30; 4:8; 8:14; 12:41). It often takes time to get suppliers to adjust the billing to include required details and then the suppliers will often change over in a new tender period (5:18) causing continuity of access problems for facility managers needing continuous on-line access to bills. (12:40). Energy users can insist on receiving the data in a set way as specified in procurement contracts but the complexity of the billing means that training, time, and therefore costs are involved, both in reading the bills and in analysing them (9:82,83). In some cases, ‘unpaid bill’ notices have been sent in error by suppliers in cases where the bills have been paid (9:84) or belated invoices arrive (one for €400,000 in Public Lighting) due to the supplier’s own accounting mistakes (9:85) amounting to “very unsatisfactory” service. Even though every gas or electric meter is numbered individually and each of these numbers corresponds to a unique meter point reference number there is no on-line search available linking them (8:23). This causes problems in linking known MPRN or GPRN billing information to the location and to the meter number because the bill may have inexact or misleading associated location information (8:22,24,34).

Local

authorities are getting the linked meter and meter point reference number data into databases but it has been and continues to be time consuming (8:24). 6.2.7 Outcomes from Past Policy Implementation (OC) OC codings were made when responses noted specific outcomes from energy or retrofit related policy implementation (or lack thereof). The findings are varied because

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this category accepted specific outcomes of any kind and did not focus on a specific topic. For the OC category, 66 scored codings were made with an average attainment level of 1.2 for National and 1.9 for Local levels (see Section 6.3). The mode was 1 in each case. For National level there were 5 codings each for the 0 and 1 mode values. For the Local level there were 10 codings each for the 1,2 and 3 modal values. For DFB, 12 OC codings were made all with a level of attainment judged as 4 due to the specific, separate results with a high quality of attainment in described outcomes. 6.2.7.1 National to Local Level – Described Outcomes Ireland’s Kyoto target was only met because of the financial crisis and recession (2:11) and overall in Europe energy efficiency to date has only achieved 50% of the progress required toward the 20% energy saving target (2:11). In SDCC, efforts at joined-up planning, as at Adamstown, saving carbon emissions and energy use by situating new developments on the Kildare railway, have stalled due to the financial crisis (9:6). However, SDCC has strong transport nodes, aiding sustainability, and very few ‘ghost estates’ in NAMA ownership (9:6). SEAI now have a highly accessible, data-rich and searchable database of all existing BERs available on-line, with selectable and downloadable data sets, providing free and transparent access to data (8:26). Over the past two decades there have been several important large scale, government-funded, national programmes of retrofitting social housing, each based on a specific upgrade: boilers, weather stripping, and double glazing are examples (9:23;29). These were reported to have often gone very well, especially fitting central heating to all of DCC’s 27,000 units, so an overcladding or boiler efficiency programme would be 101


possible but would require central government commitment and funding for social housing retrofit (10:34,35). However, the overall pace of retrofit has been slow and now it is slower so there are likely to be F and G rated houses for a long time to come (9:31; 10:33). No Public Private Partnerships are currently operating and limited piecemeal assistance is being given in former PPP areas by DECLG where the PPPs failed (7:39). Fuel poverty is a continuing problem that outweighs sustainability issues in decision-making (9:32,33).

It probably requires policy that aims for a minimum

housing standard simply aimed at eliminating fuel poverty (9:34-35). In Dolphin House flats, little progress was made for many years in addressing the damp problems, and the related difficulty in heating (10:48).

Coverage on television may have led to the

internal retrofitting of the worst affected units that is now taking place ahead of regeneration work, perhaps beginning in 2015 (10:52,50). Upgrading social housing may not result in very large savings in energy use because there can be a large takeback or rebound effect as residents can better afford increased comfort (2:53). The outcome of annual budgets for government is very tight time schedules for grant schemes with tight operating windows and a heavy administrative burden (11:44). Although policy has been encouraging ESCos as a retrofit financing mechanism, very few grant scheme applications are engaging with them (11:54). 6.2.7.2 Local Level – Described Outcomes Overall, annual energy consumption savings (5:10) in DCC are keeping pace with cost increases so that the total energy budget is approximately stable (5:12) while the total available budget has fallen by about 5% over the past two years (5:35). The cost of

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energy is still relatively low and saving it by retrofit may be expensive and difficult so energy saving has not yet concentrated minds (10:65). The target of achieving 3% energy savings in the 2011 trial year of the Minus 3% project was easily achieved with a reduction of 6% (2:17), although it might get harder to achieve 3% savings after the simpler, easier options are taken up (2:18). Similarly, SDCC saved ₏300,000 in their first year of monitoring bills with the help of three oneday sessions from an SEAI-funded energy advisor and re-tendering on the basis of increased knowledge (9:9). An energy consultancy firm has identified large savings for DCC by examining and adjusting electricity tariffs (5:6), in one case saving about ₏24,000 on one annual bill. (5:7). A large, 10% reduction in server electricity use was achieved by the IT department of DCC (8:36). Energy use in the DCC Civic Offices has been dropping by about 1% per year so although bills are rising they would be higher if no energy savings had been made (8:35). The Codema database of energy use is becoming a useful analysis tool in identifying prime locations for energy saving or large shifts in energy usage (8:33). Currently, in DCC, 700 units become void each year, mostly flats because houses do not turn over so often (10:33, 2:31,45). In SDCC, retrofitting of voids is down to 150 houses per year (9:31). SDCC’s own staff have carried out extensive BERs (1,600 to date) aiming to make BER maps of estates to target further measures (9:34). Since the new Part F of the Building Regulation was introduced, reducing the ventilation requirement, there has been more condensation in housing than ever before due to moist air from kitchens and bathrooms not being exhausted so condensation occurs in colder rooms (9:38). Even in newer, larger, designed buildings there has often been piecemeal installation of systems and services, which have not then been tested for performance, 103


or the building managers and staff may not be fully trained in how it works (8:39; 12:33). Newer leisure centres do have designed and built-in potential for energy saving, particularly if the staff increase their awareness of how to take care of energy use (12:3). Two years ago the Department of Transport, Tourism and Sport made some money available in sports capital grants, which DCC bid for: they were unsuccessful in a bid for the bigger centres, that would have installed a CHP unit in Ballymun; but DCC secured €150,000 for the smaller pools, renewing pool covers at Sean McDermott and Crumlin Pools (4:23). Such grants occasionally become available to local authorityonly bids because money that has not been taken up in a particular round of grants is then re-offered on a more closed basis, rather than inviting a large number of applications needing processing (4:23). In SDCC, newer facilities have been completed with many energy saving, or onsite energy supply features including; CHPs, wood pellet boilers, energy efficient lighting, and heat exchangers in leisure centres; and ground source heat pumps and photovoltaics in other buildings (9:22). Last year SDCC were able to show savings of 15% in their buildings; for the first time, this was a verifiable figure using combined cost and energy data to prove the savings. However, there do continue to be many opportunities for energy saving where savings can be made through energy efficiency and Energy MAP (9:28). 6.2.7.3 DCC Green Plan: Described Outcomes The Green Plan has now become the business plan of DFB, guiding all decisions in a sustainable direction by asking, “Can we actually sustain a front-line emergency fire service?” (13:11). After four years, since inception at Kilbarrack, the ring-fenced saving fund has become self-generating, enabling retrofit of further fire stations in sequence, each retrofit’s savings adding to the fund to make further savings (13:7,11). 104


Retrofit work is complete at Kilbarrack and Phibsborough and semi-complete in Donnybrook, Dolphin’s Barn and Tallaght Fire Station (10:39). Water is seen as equivalent in importance to energy so, at Kilbarrack, all grey water from the fire station and rainwater collected from its roof is treated and used in the fire engines to put out fires (13:28). Running costs for water were €5,500 annually but now almost no water is now being used from the mains, such that the station is 97% water independent (13:29). At Phibsborough, a 20,000 litre tank has been installed below ground and all water for fire fighting now comes from the roof (13:33) – each fire station has the potential to collect 14,000 litres of water every ten days with fire engines requiring 1,800 litres per fill. Uniting the Green Plan ‘Transport’ and ‘Waste’ themes, biodiesel made from cooking oil collected from fish and chip shops across Dublin is being used to reduce fire engine running costs by €150,000 per year – biofuel from land crop is not acceptable because it competes with food (13:37). Overall, it is estimated that DFB will easily achieve the energy saving and carbon emissions reductions well ahead of the dates set, potentially reaching 90% savings if the new procurement document leads to the ESCo and private funding arrangements that are planned (13:39). At Kilbarrack: reductions of 97% in water usage and 85% in energy use have been achieved; present and retired firefighters have been involved in creating an allotment and growing vegetables; and wind turbines have been successfully trialled. In DFB, the Green Plan has now also led to recently completed successful trials of three phase lighting, recycled frying oil as fuel for the fire engines, and a live registry, each of which will deliver major savings (13:pc). These have all come about beginning with the savings made at Kilbarrack and are now at the other stations also.

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‘Society’ is key theme in the Green Plan, both internally, in each station and in the Fire Brigade as a whole, and externally, so that stations become hubs of sustainability for their local community. School children across Dublin are beginning to talk about how they are hearing about sustainability from their local fire fighters (13:12). At Kilbarrack, an on-going process of firefighter involvement and technical retrofits has created a series of socially engaged energy, waste and water saving improvements (13:9). Overall, the combination of behavioural and technical measures have led to significant returns and co-benefits: We are using rainwater and wastewater to put out local fires. Because we are doing that, the community responds with so many letters and cards being written to us. They will come up and say: “Are you the crowd using rainwater to put out those fires”. We will be there doing that and they will be saying, “That's amazing!” (13:46)

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6.3 Codings: Counts and Average Attainment Levels Table 6.1 shows a simple pivot table analysis of the overall attainment level averages for EMM categories and governance levels, providing an indicative, comparative assessment of current overall attainment within EMM categories and governance levels. These values will have low weighting if the number of codings is low. Greyed result cells indicate fewer than 10 interview comments were coded for the cell. Overall averages relate to the adjacent total count of codings. For example the overall average for Management Structure is 1.5 based on 87 comments, and that for Local level is 1.6 based on 417 comments. Table 6.1 Attainment levels for EMM categories and Governance levels.

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CHAPTER 7 DISCUSSION 7.1 Leisure Centre Surveys 7.1.1 Survey Observations Discussion The survey revealed behavioural, technical and management issues in the energy management of the leisure centres relative to best practice in literature. In the centres, many of the behavioural problems seen are initially caused by technical building or services design. As was observed frequently, if a building does not react to ambient conditions then building users attempt to change them by opening windows for ventilation or switching lights on in the darker conditions. However, energy wastage soon occurs as a result of such actions as ventilation need is reduced or daylighting improves. The literature (section 2.2) indicates that it is well worth assessing the benefits of technical changes, but even if technical solutions are put in place, good behavioural awareness and energy saving habits will decrease the payback time and overall cost of retrofit measures. Increased awareness would save energy by changing habits toward containing rather than permitting wastage, however on the basis of interview evidence, improved motivation is clearly required. It is striking that there were thirteen new facilities built between 1995 and 2008, but no significant retrofit or renewal investment appears to have been made during that time in the six older buildings. The recent retrofit measures in the older pools were only made following a successful bid for retrofit grant monies. Another bid for a grant for the larger centres was turned down, even though it would have been likely to result in significant savings. Investment logic suggests that a life cycle view of costing has not been taken in the past given the level of on-going energy costs in some buildings. As highlighted in the literature (section 2.3.3), there is an on-going cost of doing nothing to 108


an existing building. However, the survey observations, would suggest that such costs continue to be accepted as a cost of building ownership. 7.1.2 Data Analysis and DEC Ratings The very high energy use of some centres indicates that there are potentially large energy savings to be made. As Table 4.1 shows, giving 2010 figures, two of the centres, Finglas (over 2,947,000 kWh costing €162,000) and Ballyfermot (3,157,000 kWh costing €184,000) use very large amounts of energy. For Ballymun, for which the gas bill was unavailable, the electrical use alone was over 1,079,000 kWh costing €141,000. It quite probably uses more than the other two large centres judging by the electricity bill, its size, and the lack of a CHP unit.

The EUI for Finglas was 1500

kWh/m².y and for Ballyfermot it was only about 800 kWh/m².y. The CHP unit or other factors at Finglas seems to have been less efficient than that at Ballyfermot given that Finglas is significantly smaller and has a higher EUI. There are continuing losses that have wasted very large amounts of energy (and money) in the past and continue to do so unnecessarily. The three older 'stand-alone' swimming pools all use about 1.5 million kWh per year with EUIs between 1,700 and 2,200 kWh/m².y. These are large amounts, though surprisingly their DEC ratings for 2010 were E1 and Fs rather than Gs, when benchmarked against similar buildings. Illustrating the current and past level of energy waste, at Crumlin Swimming Pool, the proposed installation of heat recovery ventilation at a cost of €80,000 (with BEW grant funding) could save at least 30% in gas usage that currently costs over €50,000 per year giving an annual saving of €15,000 (Codema, pc). Much more would be saved with additional insulation and air sealing, which could be pumped into the cavity walls, raising air temperatures, increasing swimmer comfort and reducing

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evaporative heat losses from the pool, potentially saving a further 50% of the remaining pool heating cost. The scatter chart (Figure 4.3) of the leisure centres showing Total Energy Cost versus Energy Cost Index (ECI) provides a useful analysis method. Changes in both axes, from year to year, are immediately apparent and require explanation.

For

example, the very large changes in energy use for four of the centres from 2010 to 2011. There may have been a change of usage pattern, equipment failures, behavioural changes or billing errors. The absence of data for some buildings and only one or two annual data points for each centre restricts the current usefulness of the chart. These are retrospective measures of performance but even this limited evidence of large changes shows that there is a need for automated ‘live’ monitoring of the energy use of the centres given the high energy costs in some of them. The 2010 figures, in Fig. 4.1, 4.2 and 4.3, indicate similar energy performance for all three older pools, but the 2011 figures are dramatically different with a total cost and ECIs for Sean McDermott Street and Coolock in 2011 twice that of Crumlin. These large rises in costs are particularly in need of explanation given that 2011 was a significantly warmer year than 2010. Finding the reasons for these changes is a critical part of energy management but a question for the later interviews became whether there were established mechanisms in DCC to identify these changes in a systematic way. 7.1.3 Survey Conclusions The continuing difficulty in obtaining energy consumption and cost data for the leisure centres, more than 18 months after the 2010 year-end, implied some form of failure in systems to address energy waste and resulting emissions be it at supplier or council level.

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It may be that these findings are unsurprising to managers, but as strongly indicated by the literature (section 2.2), good energy management relies on good data collection, systemised reporting and analysis expertise that appears to be lacking currently within the department and in the centres. As mentioned by staff, all energy bills go to the Finance Office directly to be paid. Even where the facility manager was interested in energy use and recording meter readings it was being done manually, out of personal interest and without any advice on how to analyse the data (to weather correct it for example). The lack of automatically logged, time-interval metering in large centres is out of step with effective energy management procedures. As evidenced by the experience in DFB, monitored BMSs are worthwhile for buildings where costs are high. The very poor energy efficiency of the older leisure centre buildings is largely due to poor building fabric and out-dated services, which have been more or less unchanged for 30 years.

This indicates that these are clear candidates for deep retrofit or

replacement to be judged on a reasonable lifecycle, having all been more or less unchanged in fabric terms for more than thirty years. Coolock is a particularly energy wasteful building with very high operational costs (see Appendix H). A life cycle costing would compare the 30-year energy use and rental or lease costs with the replacement costs. Repairs are planned at Crumlin Swimming Pool, due to its leaking roof, but despite this major retrofit the major renovation plans (DCC, pc) do not include an energy upgrade to the whole building on a cost-optimal, life cycle basis as the EPBD-R lays out. By observation, it is a rectangular building with ease of access to all sides and the pool building has wide-cavity masonry walls (survey by DCC shows cavities around pool area are 300 mm across) that could efficiently and cost-effectively be filled with 111


insulation. For these reasons it would seem an ideal candidate for a 30-year lifecycle deep retrofit approach. 7.1.4 Limitations of the Leisure Centre Survey The walk-through energy audits were restricted in time to between one and four hours and relied on personal observations and conversations with staff. Much of the time was spent in measuring the floor area, a key input for the DEC calculation. The plant rooms were seen in all cases but only visual observation of boilers, HVAC and lighting types was undertaken; no technical examinations were undertaken. These factors limited the depth and quality of the findings. Nonetheless, the basic audit revealed many areas that would require more detailed auditing to assess retrofit potential especially the HVAC systems. The detail revealed by staff depended on which members of staff were available and their level of knowledge of energy use in the building.

7.2 Document Analysis 7.2.1 Appropriate Investment Appraisal The document analysis findings (Sections 5.5.1 and 5.5.2) show that simple payback, without a specified time limit, is the appraisal method favoured by the BEW grant scheme. The only mention of other methods are cells provided in the sub-project listing for NPV and IRR but there is no a stated study period or specified reference data given, so any NPV or IRR entered would be meaningless for comparative purposes against other applications. Energy management references describe simple payback as an inadequate method of investment appraisal (see Section 2.9), particularly unsuited to financial appraisal of energy upgrade investments for existing buildings. There are many reasons given as to why simple payback is not an appropriate decision-making 112


tool (itemised by Russell, 2010:130-134) yet the BEW grant scheme encourages its use by applicants and it seems to be in use by SEAI in the Value for Money grading of applications. Although BEW scheme objectives are not focussed on funding projects that are necessarily financially viable, as such projects should theoretically be undertaken in any case unless there is market failure (mentioned also in the interviews), the objective of all investments is increase future wealth by saving relative to some alternative. This could be other investments or the decision to do nothing.

It would seem advisable for

government to use and encourage appraisal methods appropriate to the investment decisions being made, especially when one specified aim is to encourage public sector bodies to engage with private investors such as ESCos and energy suppliers. These investors are unlikely to make long-term decisions for 10 or 15-year investments on the basis of low quality data or inadequate appraisals. Therefore, public sector bodies will need to understand both the importance of good input data, based on valid, specified assumptions, and how to apply appropriate appraisals if they are going to engage confidently with funding parties to obtain good value for public expenditure on energy. 7.2.2 Timescale, Data Accuracy and Relevance Accurate data for costs and savings are critical to good quality appraisals, as is the timescale for assessment. The BEW Application Form appears to encourage the use of only installation cost and a predicted figure for savings, based on a single year's energy data, as a basis for a simple payback calculation. As was seen in Section 5.2 there appears to be some data in the application that does not meet investment appraisal requirements for savings to be justified as being incrementally based on the proposal. Also it may be that some of the savings allow double counting though this is difficult to

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determine on the basis of available information. No assumptions are identified, thus it is difficult to see how the investments could be graded effectively in 'Value for Money' terms. The use of only a single year's data, for 2010 (a cold year), does not give a strong basis for an estimate of predicted savings. The observation, made during the surveys, that new pool covers and pool water heat exchangers had been or were being installed in Crumlin and Sean McDermott Street for example, indicates that savings due to these measures should have been accounted for to give a more accurate corrected baseline. As noted in the surveys findings in Chapter 4, the lack of 2011 billing data access at the time of the application probably restricted the ability of DCC to provide a more current baseline usage. Only data that is of high quality should be used in investment appraisal; however, collecting good quality data is time consuming and often costly (Holmes, 1998:7-8). As the BEW Guide is dated March 21st, and Application Forms had to be submitted by the end of April, it is possible that, given the very short timeline, applicants who were not already prepared for the grant scheme may well not have had sufficient time to check data to a high standard. Nonetheless, the application was submitted by DCC and approved by SEAI, indicating that the ‘first-step’ procedure of checking the data carefully was not one that would cause rejection at any of the assessment stages of a Sub-Project or Project, or of the application as a whole. Lifecycle costing or DCF methods would generally require a timescale of between 15 and 30 years, requiring many other costs and adjustments to savings to be included, potentially greatly altering the appraisal. Such lifecycle and accounting requirements are the methodology advised by the Department of Finance in the Capital Works Management Framework (DoF, 2009:55) and by the EPBD-R as informed by EN 15459 114


(Zirngibl and Francois) yet they are not being used in the grants and their use would seem to be justified. 7.2.3 Comparing Appraisal Methods The charts presented in Section 5.3 illustrate the differences between appraisal methods by hypothetically assuming that the data for the 16 sub-projects met investment quality and relevance requirements, the aim of the comparisons being to compare different methods of appraisal to inform choice of appraisal methods. Simple payback does give rankings that are broadly similar to other appraisal methods but, critically, it gives no indication of the profitability or overall benefit or loss provided by the investments. The four shortest payback period investments are by far the best value proposals, as also chosen by the other methods, so it is the ranking of the more marginal investments where differences become clearer. For example, project 5 appears to have a reasonably short payback of six years yet, as shown in the NPV and PI charts it is barely profitable and may be unprofitable if the anticipated savings are not as high as predicted. All of the alternate methods provide more information and give more definite accept/reject criteria than simple payback. As noted in Figure 2.1, retrofit appraisals for existing buildings are not yes/no decisions because the option to keep the building has already been accepted. The comparisons performed illustrate that simple payback is an inadequate and potentially misleading appraisal method, Graphing the projects on a scatter chart of PI versus NPV (Figure 5.5) gives an effective visual presentation of the projects returns, portraying both value for money invested and overall financial value of the project.

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The Danish profitability index appraisal method for retrofitting is straightforward and simple to understand for policy makers, architects, builders and building owners alike. As with the other methods, reliable well checked data is required. It gives a preference to long-lasting, fabric-first passive measures like insulation and windows – as noted in Section 2.3.4, research shows that this can be financially justified. As the method does not involve DCF it is also simple to calculate, given good data, and it has a very straightforward decision-making level, stating simply that, if the PI is above 1.33, “It is required to proceed with the measure�. It is clear from Figure 5.7 that it is likely that more retrofits would pass the acceptance threshold using this method. For all of the appraisals the result would be more meaningful if all lifecycle costs and benefits were used. 7.2.4 Limitations of the Document Analysis The document analysis of the SEAI Guide for BEW scheme applicants and DCC funding Application Form to SEAI is not an in-depth analysis of the scheme itself but is only aimed at assessing, in light of the declared deep retrofit aim of the funding, the data quality and appraisal methods that were requested, utilised and approved. The findings and discussion relies on the relevant investment appraisal literature consulted, and findings may only apply to this scheme. Nevertheless, the findings provide an insight into an outcome of energy policy in regard to retrofit investment by a national agency and a local authority.

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7.3 In-Depth Interviews 7.3.1 Coding Analysis and Interview Limitations 7.3.1.1 Coding Analysis The coding analysis in Table 6.1, shows the main purpose and relevance of the study was to investigate energy management and retrofit investment as implemented in Dublin, and as they are directed toward achieving the nationally set targets.

The

national and local levels, and the main implementation categories therefore had the most codings. For the national and local governance levels the codings are very similar for each category, lying in the EMM attainment range between 1 and 2 with ‘investment and cost analysis’ at the low end of the range. The data quality provided by energy suppliers was assessed as being poor at 0.9. The interviewees in the Fire Brigade and the Poppintree Leisure Centre were exemplar cases skewing the averages in these categories toward higher values, but providing comparative data for the national and local level indicators. Table 6.1 indicates some of these weaknesses and some of the strengths within interviews by stating where the number of responses related to an average or a particular EMM category and Governance level combination. Questions on supplier-provided data were only added to the interviews when it became clear that this was a significant issue (so some respondents were not asked and some would be unaware of it). Except in confirming the basic targets for energy and emissions saving, energy management policy was mentioned by only a few respondents. 7.3.1.2 Limitations of the In-Depth Interviews The coding of interview data aimed to reduce subjectivity limitations in assessing a large number of responses, by use of a framework derived from literature review. This 117


reduced the influence of the form of the questions or biases of respondents, provided sufficient codings are made (Gibbs, 2011). Judging the attainment level reached in energy management categories, as the analysis attempted, does rely on the coder, but the need for a high level of calibration was considerably lessened by the first-approximation estimate of attainment essayed by this research. In fact the codings could be likely to over estimate the attainment level as the grading aimed to be in line with the respondent’s opinion as well as being scored in regard to the EMM. The exploratory nature of the research means that more data is needed to fully triangulate the findings.

A further limitation, due to the restricted number of

respondents and the research time available, was that no interviews of top-level management were undertaken. This would be a recommendation for further research. Nonetheless, the ultimate implementation of energy saving policy depends on those closest to where 'coalface' energy-use decisions are made and as such the results should reflect these actual practices relating to energy management at present. All of the interviews relate to Co. Dublin, the largest urban centre in Ireland, and are relatively large councils so there are limitations of scale in applying findings to other local authorities though the findings regarding funding and governance mechanisms are widely applicable to other local authorities. 7.3.2 Interview Discussion by EMM Category 7.3.2.1 Energy Policy Energy policy at national and local level is focused on achieving targets in energy saving and carbon reduction. Although headline targets were strongly repeated by respondents, no further detail was evident apart from references to the NEEAP. Policy

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is in place but it does not seem to be integrated, enforced, systemised, or ‘bought-into’ sufficiently at local level to have been noted in the interviews by respondents. Respondents noted that the national policy of improving social housing to C1 would take many decades at the current rate of progress. Given the limited funding support for it, policy with such low levels of implementation would seem to lack significant merit. Similarly, at local level, the lack of definite annual or disaggregated objectives or penalties, diminished the value of energy and climate policy for respondents. No guiding policy, or funding, was mentioned that would encourage individual, council departmental actions toward establishing behavioural or other managerial energy measures. In Dublin, the SEAP is published but does not seem to be guiding the departments within DCC, no baselines appear to be available for use by departments as evidenced by respondents. No targets or policy from the NEEAP or the SEAP were seen to be affecting the leisure centres for example. In contrast, the Green Plan policy themes seem clear and highly result-oriented with an initial focus on cost saving, enabling further investment. Most apparent was the concentration on sustainability in all aspects that has clearly inspired staff and management to achieve real savings. The policy emphasis on behaviour and carbon saving, as well as measurable targets and results, was clear from the published reports. The interviews confirmed this, but also showed that, though impressed, other respondents remained highly uncertain about how the Green Plan results had been achieved. It seems that senior managers and, especially, facility managers elsewhere in DCC and in other councils could learn from looking more carefully at the Green Plan policy

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documents. The concentration on operational level results, strongly linked to changing habits by engaging with core themes of sustainability could inform and improve future policy in DCC and elsewhere. 7.3.2.2 Management Structure A strong literature finding was that managers should take responsibility to manage energy, but it was clear from respondents that management structures in European, national and local governance, continue to be top-down, complex and highly departmentalised. The varying structures and management interests reported make it difficult for effective, systemised and encouraging energy management to take place in the public sector.

There was no clear sense from interview respondents that the

management structure of DCC is deeply engaged implementing policy with energy management, either in supporting facility staff to save energy or in energy accounting to monitor and target energy saving. At best such processes are in the early stages of development. Unclear communication between and across governance bodies was frequently mentioned as being problematic. SEAI have to communicate with a wide range of local authority boards and agencies to create programmes, which delays implementation. Councils have to go back and forth with the DECLG negotiating over building projects. Local authorities engage in time-consuming negotiations over larger retrofit schemes with DECLG. Given the annual funding nature of budgets, a delay of a few months may well miss the next funding allocation and working window, delaying things further. As noted by several respondents, councils currently have to go to the DECLG with proposals and negotiate on a “case by case� basis and then resubmit proposals repeatedly, awaiting rejection or acceptance without clear information on the decision thresholds.

From the responses given, these management structures appear 120


unnecessarily top-down, complicating instead of delegating local decision-making. Overall, these findings echoed the ‘organisational zoo’ outlined by literature (see Section 2.4.3). This concern extends to city and county energy agencies, which were reported as having many different organisational models. It was notable that the external agency in Co. Meath was mentioned as having closed due to spending cuts whereas, in contrast, it was a small, in-house ‘agency’ in Kerry County Council that was noted by many respondents as being successful and innovative. This lean, expert, in-house format might be one that councils elsewhere could adopt, provided they will or can fully commit to energy management and medium term time horizons for investment. As noted by the literature, and as in the Green Plan, rather than distancing energy decisions, good practice in energy management relies on all managers and staff recognising their roles in supporting and achieving energy saving. SEAI’s Energy MAP was cited as being helpful by both SDCC and DLRCC, but DCC has not yet engaged with the Energy MAP process. It is possible that the larger size or more traditional structure of DCC’s management systems is in some way restricting this involvement. On-going retirements in the public sector, partly resulting from the response to the financial crisis mean that there is also a drain of such sources of expertise that are available, so retraining would seem an important option to take for councils as shown by the effective example of SDCC’s retraining of staff to carry out BERs. Architects and leisure centre managers reported that there is no clear in-house council back-up bureau or energy manager for them to call for immediate advice on energy management or retrofit investment issues. By comparison, the Green Plan exemplifies profound organisational change beginning at the periphery of an organisation (see Section 2.2.2), in this case motivated 121


by an energy champion and supported by staff and management. DCC have supported FF Neil McCabe in pursuing the Green Plan and it seems clear that that the DFB management structure has been forward looking, not only in supporting the plan at Kilbarrack, but also taking it in to change their entire business plan to enhance the longterm sustainability of the Fire Brigade’s services and operations. Codema act as advisors on special projects, often EU funded, and influence policy but is not delegated with authority to independently monitor energy use or costs in council departments to achieve targets. Codema have been assisting in documenting the Green Plan work in DFB recently, and an energy agency would seem an ideal advisor to directly support local and departmental energy champions to achieve results in specific savings projects by assisting with technical and investment appraisals. However, this does not seem to be a large part of their role currently. If Neil McCabe is going back to full-time firefighting, as he said in interview, then it would seem ideal for DCC and Codema to become more active in continuing his work, with his advice, to provide the back-up technical and procurement knowledge necessary to systemise continuing support for the Green Plan for DCC departments and facility managers. 7.3.2.3 Implementation and Motivation A quoted respondent said that, in spite of policy, implementation had not fully connected across government, but also observed that everything does connect at the facility or building where the energy is used. This seems a key point that the Green Plan addresses directly, by engaging directly with personal reasons for actions and habits. This may help explain why the top down programmes, worked on by different governance levels and bodies are more likely to fail, especially when judged by their costs relative to their success or lack thereof. Although the area retrofits in Dundalk and Tralee were mentioned as good examples of implementation at scale, there seem to be 122


no plans at national level or in Dublin to replicate them in the near future and only vague intentions to engage with energy suppliers. The accepted fact of widespread fuel poverty in publicly owned housing would seem to confirm an on-going failure in national policy implementation that has continued for many years. In spite of government advisory reports showing large net benefits, mentioned in several responses, this is set to continue for many more years given the even slower rate of retrofit now occurring. The logic of the policy of not rerenting F- and G-rated houses and retrofitting so slowly is that governments accept that they will continue to be the landlords of such poor houses into the far future. National government, the primary source of upgrade funding, is therefore, directly responsible for the resultant excess future carbon emissions.

This is at odds with the stated

emissions policy and was the case even before the financial crisis according to respondents. This suggests that other considerations must have favoured the on-going capital rationing with respect to social housing retrofit, amounting to market failure in investment terms, both before and since the financial crisis. BER ratings have clearly been effective in benchmarking retrofit improvements, as noted by respondents regarding pre- and post-works BERs for social housing void upgrades. Energy performance certification, such as BERs and DECs, resulting from the EPBD, therefore appear to be an example of how top down government has succeeded in supporting and enforcing policy through strong regulation. If government were serious about energy efficiency policy with the public sector as an exemplar it would seem similarly important that requirements for official DECs to be in place would be enforced. Also, Energy MAP or ISO 50001 might be required rather than voluntary and all public bodies would be required to publish and budget for a rolling retrofit investment programme to identify the ideal first candidates for deep retrofit. As 123


was reported by respondents, these kinds of top-down regulatory moves are not occurring and are not being funded. As a result, the understanding of respondents was that energy management and deep retrofit are seen as much less important than cutting costs or maintaining the status quo. SEAI’s Energy MAP programme was mentioned as playing a role in motivating change in energy management practices in SDCC and DLRCC. In DCC, Codema’s survey audits and reports are communicating building information to departments that may not have considered their energy use previously and outside experts recently been examining bills to find savings. The database of information on DCC buildings will clearly be of great use in DCC energy management in locating facilities where unexpected changes in energy use occur and identifying potential buildings for further assessment with a view to retrofitting. It was not clear from interviews how strongly departments respond to the advice given by Codema. According to respondents, implementing energy management is most likely to be motivated by individual managers with a personal interest in energy saving, as in was noted in Corporate Services or in Poppintree Leisure Centre, or by EU supported, large scale projects run by the council’s energy agency. In EMM terms these are both seen as isolated and sporadic approaches rather than continuous localised improvement throughout an organisation. Findings regarding behavioural change were well defined. Respondents noted Codema’s Switch Off campaign as a success, though the achieved savings were modelled rather than metered and it was difficult to know if its effect was continuing. Elsewhere though, behavioural change has been difficult to implement and has lacked support. The contrast with the Green Plan could not be more clear: behavioural change began at Kilbarrack with collecting batteries, and has continued through constructing 124


their own rainwater harvesting, involving retired firefighters, and now firefighters are teaching sustainability to school children. The Green Plan’s core ethos has clearly resonated with firefighters and management and it seems important that it has mostly been about doing things toward sustaining work, community and the environment through doing things well, rather than the focus being on ‘energy efficiency’ and ‘retrofitting programmes’. It has also come from a trusted, operational-level co-worker not from upper management or outside agencies, though supported by them. And it has been on-going, encouraged by small projects with good results, and then larger projects repeating the message of success, enriching the knowledge base and increasing local self-confidence. These findings echo business literature and may well provide a template to follow for other council departments and other local authorities. 7.3.2.4 Cost Analysis and Investment Responses indicated that the kind of detailed technical and investment expertise brought to DFB’s individual projects appears to be generally missing from Co. Dublin councils, in large part because times have changed so radically since 2008. Before then, large capital projects and new builds were commonplace, and income gained by selling houses was put into upgrading remaining stock. Now, budgets continue to be cut and there is a realisation that retrofitting existing buildings has to be done, or whole life cost calculations have to be carried out to see if a new build would in fact be cheaper over a 30 year lifespan given lower operating and maintenance costs. However, local authorities act under significant financial constraints due to the financial situation, annual budgeting and an inability to act independently.

Their

decision-making is dependent on a web of grant funding arriving from different

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departments and grant schemes, which often require time consuming and administratively burdensome bidding or proposal processes for the DECLG or SEAI grants. The appraisal findings presented in Chapter 5 would seem to confirm this analysis. As a respondent noted, local authorities are always in need of money, making the need for this kind of grant system questionable, especially in view of the severe constraints imposed by annual budgeting and the rapidly decreasing level of available funding. As was clear from interview responses, the separation of capital and current spending, especially in the current financial environment, combined with single year accounting, causes significant problems for energy management and retrofit investment. Installing monitoring equipment, technical or investment guidance, and other such measures requires monies to be spent from highly restricted current spending. Any savings made by departments cannot be reserved for future spending nor are they being ring-fenced to invest in energy saving measures. Interviewees were clear that capital spending, even for investments with short paybacks, is highly restricted and so life cycle costing is not possible, limiting the potential for value-focused investment appraisal. Respondents noted that local authority management is currently motivated far more strongly by cost cutting policy than by energy saving or carbon emissions reduction policy. The energy consumption figures are only now establishing a baseline so it will be even more time before measures can show their worth. Deep retrofit will require a more holistic, lifecycle approach to energy saving. As seen in the leisure centre survey and interviews, new buildings were built during the Celtic Tiger period but older houses and leisure centres were not renewed. Interview responses showed that significant, lifecycle ‘replace or retrofit’ decisions have been delayed, in favour of capital spending on new buildings or current spending for on-going maintenance and 126


repair. Now there is little capital spending, and current spending may or may not be sufficient to cover maintenance and repair, as evidenced by the repair work that will soon proceed at Crumlin Swimming Pool and the recent cutbacks affecting house retrofits and building maintenance noted in SDCC. Medium term investment such as energy auditing, metering, monitoring and analysis, or small retrofit projects, are also unlikely to proceed because they require monies from current funding. As it will have to be closed for major renovation, Crumlin Swimming Pool would seem an ideal building for a long lifecycle, whole building deep retrofit in line with government and European best practice. However, the existing plans (DCC, pc) only extend to replacing the leaking roof and internal refitting rather than deep retrofit with whole building insulation and air sealing. Piecemeal renovations are also on-going in Dublin flats, which were mentioned as being long overdue for replacement or cladding (though a regeneration is planned beginning in 2015). It is notable that architects in DECLG and Dublin councils are fully aware that the solutions being used are neither optimal in cost nor in building science terms, but they note that they have to make do with the funding available. For social housing, councils do not receive any benefit from increased rents after retrofit, creating serious ‘principal-agent problems’ in retrofitting. As noted by respondents, research suggests that these are highly productive investments for society with numerous long-term cost, health and energy security benefits As mentioned by respondents, retrofitting entails significant ventilation and condensation risks, requiring considerable building science knowledge and analytical skills, which were noted in interviews as being new to many architects. Much technical and investment appraisal evidence (acknowledged in interviews) shows that shallow, piecemeal retrofits may provide poor long term value and carry potential condensation and ventilation risks. Unfortunately, due to the short time horizons enforced by both 127


annual budgeting and financial circumstances, dominated by demands for short-term cost saving, these continue to be the dominant type of retrofit undertaken. Commonly throughout the councils, there appears to be a very limited understanding of investment analysis that could facilitate retrofit decision-making. DECLG provide useful technical guidance on retrofitting dwellings (pc) and although they use simple payback appraisals, the acceptable payback was stated in interview as being up to a reasonable acceptance level of 15 years. However, to invest in such medium to long-term energy saving projects will require more funding or different funding mechanisms. If this means engaging with private ESCos or energy suppliers then the findings presented here show that local authorities will require a much increased awareness of investment appraisal and funding streams to ensure that they can effectively evaluate the proposals made by funding parties. The literature review showed that whole life costing is part of government recommended procedures (see Section 2.3.3), but it was found that these are not in use by councils (or by SEAI or DECLG) in costing projects. Both the literature and many of the respondents agree that lifecycle costing, even of a simplistic kind, would give an improved basis for judging long-term decision-making. Unlike traditional budgetary mechanisms, the Green Plan’s revolving fund financing model has provided flexibility in project selection and freedom in timing. Its successful results and the interview data indicate that the artificial division in public finance between capital and current spending is directly undermining investments in sustainability and deep retrofit energy saving. The seed-funded and ring-fenced saving, revolving-fund mechanism also offers an ideal model for current financial circumstances, allowing early “low hanging fruit� energy upgrades with fast paybacks and high returns to pay into a local fund that finances further retrofits on the first site 128


and then at other sites as the fund grows. This agrees with the ‘cap and invest’ financial and ‘sufficiency’ carbon emissions reductions policies (noted in Section 2.3), thereby avoiding rebound effects by reinvesting in more carbon reduction. 7.3.2.5 Monitoring and Targeting DCC currently have a target of 33% energy saving by 2020, also stated as 3% per year. As the target is not disaggregated, it is implied, and was generally understood by respondents, that this is also the individual target for each department and each facility. If energy efficiency is the policy objective, it cannot be judged without good energy data. If the initial reference level for a target, the baseline, is not accurately defined with reliable and accurate data then no point can be defined at which the target is reached. This would mean that the target is equally meaningless. This does not mean that efforts to save energy are valueless, but the 33% energy saving and 20% carbon saving targets are strongly featured in policy documents when the baseline data to support them does not yet exist. Currently, accounting can readily report total council energy costs for gas, electricity and fuel but this is not so easily done at present for individual council departments who may not know what their own energy use is currently. Combined with the great difficulties obtaining energy consumption data, reported by virtually all respondents, this amounts to very weak energy accounting when judged relative to Table 2.2. SEAI are now moving to ensure that consumption data is available shortly but it is not clear that cost information will be strongly or directly linked to it as good energy accounting demands. Though respondents reported that kilowatt-hours are the measure preferred by SEAI and governments, this requires the setting up of energy accounting systems, which

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are yet to be established and have numerous complications, as was noted by several interviewees. The Green Plan aim for initial cost savings may well be a key target metric because it is easier for all involved to understand money. Critically, it is already highly monitored through standard financial accounting. As confirmed by personal communication with the DCC Finance Office, energy costs are not currently accounted for separately in this way, for each specific leisure centre for example. Doing this would give a baseline energy cost for every centre, potentially with good historic data also, against which to target improvements. Examining bills carefully requires knowledge and analysis but can clearly pay dividends as in the €24,000 saving made by an energy consultant on DCC electric bills. Energy usage data is not being reported, or accounted for, even in large facilities, in ways consistent with good energy management practice to enable checking of billing and supplier-submitted arrears. The three largest leisure centres are significant energy users but remain unmonitored whereas the OPW were noted as having interval monitoring with remote logging on much smaller buildings. It would seem prudent to ensure that monitoring, reporting and analysis are in place for the larger centres. 7.3.2.6 Provider Data Frequently mentioned by respondents, the unacceptably poor quality of data provided by energy suppliers is an on-going problem creating serious accounting problems for the Finance Office in DCC and for facilities and departments bearing energy costs. As reported, energy bills and arrears claims are difficult if not impossible to verify, potentially allowing possible billing errors submitted by suppliers to be paid but not allowing any effective means of checking the billing’s accuracy. The billing problems appear to echo the “atrocious” UK utility billing practices (see section 2.2.4).

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As confirmed by the NPS (pc, email), the existing tendering contract allows the NPS to enforce billing requirements and it would seem possible to insist on a simple billing format from all energy suppliers providing uniform digital, soft-copy data containing all relevant identification, cost, consumption, carbon emissions and meter information on a single line of readily interpretable data (OPW, 2010, see S3.5, S1.2.2 and S2-2.7).

The contract states “Tenderers shall supply such information in the

electronic format specified� (ibid.:14). When contacted regarding these findings, the National Procurement Service (NPS, pc email) commented that building up the client base of public sector bodies has been a major task and they will only be approaching the suppliers once the many registration and supply point transferral resolutions have been carried out and after the requirements of the many public sector bodies have been ascertained. Energy policy that does not begin with good energy accounting, linking cost and consumption, is compromised by poor data and will be of limited value. The billing data problem would seem a straightforward one-off cost to address.

As a

condition of tendering and as a supplier obligation this could be regulated for and immediately enforced by government to support energy policy. Further data problems noted by respondents were delays and information gaps when obtaining meter point reference numbers (MPRNs and GPRNs) from the MRSO when meter numbers were submitted. According to respondents there is no clear reason why the data is not transparently available on-line. 7.3.2.7 Outcomes The better outcomes reported in the findings include the on-line database of all existing BERs made available by SEAI and the two area retrofits of estates in Tralee and Dundalk. Few other positive outcomes were apparent from interviews though. At local level, in DCC, the Minus 3% and Switch Off projects coordinated by Codema, 131


were reported as notable successes, as judged by modelled results, as was a 10% reduction in electricity use achieved by the IT department in the Civic Offices. SDCC’s verifiable 15% savings using energy data combining cost and consumption data were notable for being monitored savings from bills rather than modelled results. SDCC and DLRCC both reported successful outcomes from using Energy MAP guidance from SEAI in gaining a degree of knowledge and control over billing issues though problems remain. SDCC and DCC have made efforts to upgrade public lighting despite the lack of metering on these very large accounts. The plan by SDCC to tender this account separately would seem a good option to establish its worth more exactly. Newer public buildings have incorporated energy saving designs but frequently the services have been installed in ways that do not enable ease of access to controls or switching to facility managers. 7.3.2.8 Outcomes: DCC and DFB Green Plan The outcomes reported from the Green Plan were qualitatively and quantitatively different from other responses. The Plan’s declared aims of core sustainability of the Dublin’s fire service have been matched by real projects with measured and verified results at Kilbarrack Fire Station, following an initial grant investment which paid back within four years. The long list of verified results, from many interrelating projects supported by behavioural change, indicates a different approach from those generally advocated in policy. There is a habit changing purpose to the Green Plan and the firefighters’ achievements that is not clearly set out in government energy efficiency literature or grant schemes. The Fire Brigade has a very hierarchical and regimented structure that may well have assisted the Green Plan after it was accepted but this may also indicate the level of

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commitment and teamwork that is required to achieve strong results, especially the kind of early results that feed back to create a continuing impetus to do more. It is evident, from the interview responses, from a visit to Kilbarrack Fire Station, and the level of data gathering in research, measurement and verification, that evidence-based and structured decision-making is part of the fire brigade’s modus operandi. Combined with a strong purpose in carbon saving and behavioural change these factors have transformed Kilbarrack from a highly wasteful building with a staff of firefighters with low morale into the world’s first carbon neutral fire station, greatly increasing morale and community support. The technical and procurement expertise developed by Neil McCabe through his own research over several years has undoubtedly been critical to successful implementation. DCC have supported the Green Plan’s development and the next stage would seem to be for individual departments to develop their own version by supporting their operating staff in working through the Green Plan themes in their facilities or buildings. Starting very simply, as happened at Kilbarrack where firefighters were surprised by how many used batteries they could collect from their homes in a short time, was a small but important first step. It would seem sensible to follow the same pattern by supporting the most motivated staff to engage in sustainability in these simple and rewarding ways first. The Green Plan began at one site with high potential savings, by motivating and encouraging one team, it would seem sensible to start in the same way again.

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CHAPTER 8 CONCLUSION 8.1 Conclusions and Recommendations By using an Energy Management Matrix (EMM) framework of qualitative assessment to answer the research question (Section 1.3), this research into energy saving and carbon emissions reduction policy found that implementation at local authority level in Dublin is only poorly consistent with good practice in energy management and building retrofit investment.

The EMM methodology proved an

effective framework for qualitative assessment of the gathered data. Only poor to moderate levels of attainment were found in the qualitative EMM categories – management structures, implementation and motivation, energy accounting and investment, monitoring and targeting, and outcomes. These results contrast markedly with those of the five year old DCC Green Plan that began with a flagship, Dublin Fire Brigade project in Kibarrack Fire Station. 8.1.1 Energy Policy This study’s findings, from the leisure centre survey, the document analysis and, most strongly, the in-depth interviews, suggest that current energy and climate policy is not a strong motivator of practice in local authorities, particularly compared with the current pressing need for cost savings. As was clear from all respondents, there are many hard working people in local authorities doing good work, but they are working toward poorly defined, aspirational policy aims that appear to lack adequate funding or effective regulatory bite to fulfil the stated intent. The policy conflict between short term political or financial requirements and the longer-term positive returns provided by energy and climate measures needs to be

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explicitly acknowledged and balanced if the targeted outcomes and the many potential beneficial returns are to be achieved. The Green Plan focus on localised behavioural change and carbon saving could improve both national and local policy. 8.1.2 Management Structure Interview respondents noted problems with management buy-in, communications and energy management knowledge.

These were connected with departmentalised

structures and the ease with which energy usage can be ‘somebody else’s problem’. Energy saving initiatives and programmes still tend to come from interested departmental managers or energy agencies working on discrete programmes, often without strong measurement and verification to measure results. The Green Plan results show that strong management support for operational level staff, focusing on resultsbased actions to change energy-usage habits and working practices, can achieve excellent energy management and retrofit investment results. There may well be special factors in the DFB success, associated with Neil McCabe and the fire brigade’s management structure.

Nonetheless, it would seem that there is much that local

authorities and national government can learn from the DCC Green Plan in saving costs, energy and carbon emissions, as well as strengthening the resilience of services and communities. 8.1.3 Implementation and Motivation Indicative of weak attainment in EMM assessment, programmes of change to improve energy saving were reported to be generally sporadic or dispersed, rather than on-going and concentrated. Respondents noted a general lack of success in behavioural change efforts and relatively few significant savings. The interview responses also

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indicated that grant funding approval processes impede deep retrofit outcomes by limited appraisals, administrative delays and annual budget timetable constraints. Given the results of this research, a much increased managerial understanding of their own critical role in energy management is needed to continuously develop, communicate, and support operational staff in achieving localised energy and carbon savings. 8.1.4 Cost Analysis and Investment The findings of this research support the view that neither the financial support currently available nor the investment guidance from central government is sufficiently strong to outweigh a past history of inadequate investment and current short-term cost cutting due to the financial crisis. The leisure centre survey showed that inadequate retrofit investment has occurred particularly in older buildings, and respondents noted that this has also been true in social housing. Both European and Irish government policy spells out a need for life cycle costing to achieve medium and long-term value in buildings but these approaches are not evident or possible in current council practice or grant funding schemes. The document analysis and appraisal comparison undertaken showed that the data quality accepted and the inferior ‘simple payback’ appraisal method used by SEAI are inconsistent with investment practice, particularly for retrofit investments of public buildings. Interview respondents also acknowledged that councils lack investment expertise.

These

deficiencies will need to be addressed if local authorities are to engage confidently with ESCo or energy suppliers in EPC arrangements in future. The revolving-fund model, as used in the Green Plan, appears to be a relatively risk free starting point for making savings, enabling a period of behavioural, technical

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and investment learning and encouraging progress by local ring-fencing of initial gains. Though probably contingent on emulating the core Green Plan themes for success, this would seem a pragmatic model for other local authorities and public sector bodies to emulate, especially in current financial circumstances. 8.1.5 Monitoring and Targeting Current policy gives headline targets but there is no disaggregation of targets to council departments, or on an annual basis, nor are there strong ‘drivers’ that would push achievement – by incentives, regulations or penalties. These factors ensure that the policy lacks meaning for council managers and staff. Even when required, as DECs are, compliance is not being enforced and there is little or no money available for monitoring or reporting measures. Data quality to support the targets is beginning to improve, but only eight years remain to reach targets that remain broadly undefined. In the short term, an emphasis on monitoring and targeting energy cost might be more useful than using energy consumption figures, as figures are more readily available. Given the very large potential for savings, interval monitoring for the large energy users like the bigger leisure centres would seem to be urgently required, and until supplier data improves it would seem essential that all facility managers obtain online access to their own facility bills by contacting their energy supplier directly. 8.1.6 Provider Data from Energy Suppliers Data quality, as provided by energy suppliers, was reported by respondents to be very poor indeed and not conducive to good energy accounting. An urgent need to require energy suppliers to provide high quality, linked energy consumption and cost digital data was identified. Though all respondents and the NPS were doubtful that this

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would change in the near future, it would seem to be more a matter of political will, given that the suppliers already provide all the required data on hard copy bills. 8.1.7 Outcomes All three methods utilised in this research enquiry showed that energy and carbon saving outcomes in local authorities, from energy management and retrofit investment in public buildings and housing, are not consistent with the exemplar public sector role set out by policy. Some progress has certainly been made in the past four years but it seems unlikely that current approaches are going to achieve the intended outcomes. In contrast to the other findings, the DCC Green Plan, in use by Dublin Fire Brigade, ranked highly in all EMM categories. It is likely that DFB as a whole will meet the policy targets far earlier than scheduled, at very low cost and with multiple cobenefits.

The management structure and operational priorities of DFB encourage

structured decision-making and energy management but this research, and the published verification data for the Green Plan, suggests that it is the deep sustainability ethos of the plan that has focused these capabilities, achieving world-class reductions in carbon emissions.

Firefighters and management have achieved the policy targets without

requiring any further investment monies after the initial grant, by using a revolving fund, reinvesting savings in further measures to increase sustainability. In speed and depth, a locally championed plan appears to be outperforming other national and agency implementation, producing exceptional cost, energy, and carbon savings as well as conferring sustainability benefits of all kinds for staff, DFB and the community. This template for success indicates that the most important ‘front line agencies’ are people themselves, encouraged by their own successes in achieving sustainable outcomes for their own workplace and their local community.

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8.2 Recommendations for further research •

Research interviews with city and county managers and councillors would provide views of upper management and political leadership that would compare and contrast with this research.

Given the energy and climate change issues now faced, there is much scope for a revival in energy management research: especially as to how operational level local programmes can be best supported by departments and agencies at local and national levels.

Examining the investment case for particular sets of buildings, in line with the new EPBD-R’s cost optimal methodology, would be valuable in showing where opportunities lie for effective public investment, particularly in identifying the optimum strategy for rolling retrofit in public buildings and social housing.

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Policy and Value: A Case Study of Local Authority Energy Management and Investment  

A mixed methods study based on an Energy Management Matrix qualitative methodology of assessment studying the current local authority energy...