Thursday, 25 November 2021
Nithe i dtosach suíonna - Commencement Matters
I welcome the Minister of State.
Councillor Ben Dalton O'Sullivan of Cork County Council and a number of other Independent councillors around the country have asked me to raise this important issue. There has been much discussion in both Houses about our second winter with Covid. While it is not yet known whether we will find a way to live with the virus or will finally kick it, there is one threat that winter will always bring, and that is the cold. We are touching the bottom of the thermometer in some places in the country and snow is on the way for others. In the face of the winter chill, our houses must be up to scratch, doubly so as energy prices rise. The energy efficiency of people's homes is as much a climate issue as it is a comfort one and a health one. That is why schemes such as the better energy warmer homes scheme are of such important, but a scheme can only be as good as its administration. That is why I have raised this Commencement matter.
Last week, I received some information from the Sustainable Energy Authority of Ireland, SEAI. There are 7,280 applicants awaiting works under the warmer homes scheme. The average time from application date to survey completion is 14 months and the average time from application to date to works completion is 26 months. I understand that works under the scheme were suspended this year in line with Covid-19 health measures. These figures do not reflect a significant backlog on account of the health measures, which is positive, but the Minister of State will appreciate that the 26 months from application date to works being completed has entailed an additional two winters in homes of subpar energy efficiency. Combined with talk of power outages over the coming winter, this paints a bleak picture.
I understand that funding for the scheme has increased significantly this year, with €100 million allocated to it, and that the capacity of the SEAI to deliver the scheme is to be expanded.How will this funding lead to a reduction in waiting times for families on the waiting list? I ask the Minister of State to outline to the House the specific steps being taken by the Department in terms of its funding of the SEAI, and by the SEAI, in addressing this issue.
I thank Senator Keogan for raising this important issue and for the opportunity to give an update on Government action to lower the average waiting times for applicants to the better energy warmer homes scheme.
The programme for Government and the climate action plan have set ambitious targets to retrofit 500,000 homes to a building energy rating of B2, cost optimal or carbon equivalent and to install 400,000 heat pumps in existing buildings over the next ten years. These targets represent a very significant increase in the volume and depth of retrofit activity in Ireland. The recently published national retrofit plan sets out how we will achieve these targets and identifies an unprecedented €8 billion up to 2030, to support homeowners to retrofit their homes.
My Department funds a number of grant schemes to support homeowners to improve the energy efficiency of their properties. These are administered by the Sustainable Energy Authority of Ireland. Since 2000, more than 450,000 homeowners have upgraded their homes with support from these schemes, representing almost one in four homes across the country. This has resulted in warmer, healthier and more comfortable homes that are easier to heat and light.
The programme for Government committed to ensuring that the retrofit programme is socially progressive, with a focus on low-income households and the better energy warmer homes scheme delivers a range of energy efficiency measures free of charge to low-income households vulnerable to energy poverty. Energy poverty is influenced by a person's income, the energy efficiency of his or her home and the cost of the energy used in the home. The scheme is currently available to households in receipt of either fuel allowance under the national fuel scheme, jobseeker's allowance for more than six months, having children under seven, family income supplement, one-parent family payment, domiciliary care allowance and carer's allowance where the applicant lives with the person being cared for. To date, more than143,000 homes have received free upgrades under the scheme.
Funding for the SEAI energy poverty retrofit schemes has increased significantly to over €109 million in 2021, with €100 million allocated to the warmer homes scheme. This is an increase of €47 million on last year's allocation and means that almost half of the total SEAI residential and community retrofit budget is available to support people vulnerable to energy poverty. The funding will mean that more households can receive free energy efficiency upgrades, leaving them better able to afford to heat their homes to an adequate level. I have also secured additional resources this year to expand the capacity of the SEAI to deliver the scheme. In addition to delivery capacity, supply chain has increased due to a new broader contractor panel that commenced at the end of 2020. Every effort is being made to maximise outputs in construction activity in the residential sector recommenced earlier this year. The commitment will not only help in reducing our carbon emissions, it will benefit low-income households in many homes. Homes will be warmer, easier to heat and more comfortable, supporting improved occupant health and well-being. Households are also more protected from changes to their income or in the cost of energy.
There are currently just over 7,000 homeowners on the warmer homes scheme work programme. Recent data from the SEAI indicates that for homes completed in the first half of 2021, the average time from application to completion was approximately 26 months countrywide. It is important to note that the average wait times have increased significantly due to the extensive Covid-19 related restrictions on construction activity during much of 2020, as well as between January and mid-April 2021 when the scheme was fully paused in line with Government guidelines. Wait times have been also negatively impacted by challenges associated with availability and longer lead times for materials. The SEAI has advised me that the average wait time should only ever be used as a general guide and that wait times vary based on the demand for the scheme at the time of application, as well as other factors, including the scale of works to be completed, access to the property, availability of materials and the weather.
Looking to next year, budget 2022 has allocated €202 million for the SEAI residential and community retrofit scheme and a further €10 million for the solar PV scheme. More than half of this amount, €109 million, will be used to provide free energy efficiency upgrades to households that are in or at risk of energy poverty. It is estimated that over 4,500 upgrades will be provided under SEAI energy poverty schemes in 2022.
I appreciate the response. I note this matter does not come within the remit of the Minister of State, but the Minister, Deputy Ryan, may not have been available this morning. I am very disappointed. Twenty-six months is a very long time, particularly for those who are on the poverty line. All of the people who can avail of these grants are on the poverty line. It is not only for this winter they will not have an upgrade, but next winter and the winter after that. It is only after that they will get the works done and, as such, it will be three years before people will be able to avail of the warmer homes scheme.
More must be done. We must either reduce the VAT rate or apply a zero VAT rate in respect of retrofit works to make houses warmer for those who are not eligible for works under the free scheme. We need to do something for the people who, possibly, can pay to retrofit their homes to make them warmer. Since 2001, only 11 homes per week have been retrofitted. That is not a success story.
I will take the Senator's proposal with regard to reducing VAT rates to the Minister, Deputy Ryan. The Senator will know that there are two parts to the major retrofit scheme, the better energy warmer homes scheme, which is free, and a further scheme for people who are owner-occupiers and outside of that. To help people to afford it, there are two parts to that, one of which is a grants scheme. We are bringing in a cheap loans scheme as well to fund the other portion of the investment because we know that many people who are working hard but do not fit within that category will be faced with a large expenditure. The idea is that the savings made from reduced energy bills would be used to meet the repayments on the loan. That is important to remember.
This scheme has changed enormously. It has moved from a scheme which had only about €20 million in funding per annum to a scheme that is now six times that size. Every year, it is massively increasing. The sum of €109 million is provided for this year for the better energy warmer homes scheme. The funding for next year will be larger in that there will be a capital carryover from unspent money. For a quarter of this year all construction activity was banned and so works could not be done. This is not just an excuse. There is a huge desire to do this. One of the most important things any Government can do is to keep poorer people warm in their homes in the winter, in particular older people who feel the cold more. It is an absolute necessity. In the face of rising energy prices and so on, it is a priority that we manage to do that. We cannot achieve our climate action goals without doing this. We need to insulate all these homes in this country. It is an enormous project, costing €25 billion over ten years and it requires 25,000 staff. There is huge retraining going on and huge redirection of financial resources. It is a massive priority for us. Any suggestions the Senator may have would be welcomed by my office or the office of the Minister, Deputy Ryan.