The Brief
The Department of Business, Energy and Industrial Strategy (BEIS) commissioned six demonstration projects – each focused on a different specific region – to test different approaches for increasing the rates of energy efficiency improvements amongst able-to-pay owner occupiers, as part of the Local Supply Chain Demonstrators Scheme. The aim of the demonstration projects was to increase the uptake of retrofit work in target areas through:
- Providing funded support for local supply chain integration and project coordination
- Targeting able-to-pay owner occupiers and the private rented sector with attractive and more affordable opportunities for retrofit work.
Despite differences across the individual projects, the intended outcomes for the overall scheme were:
- The coordination of the retrofit supply chain to improve the quality and consistency of retrofit work, while increasing the skills and knowledge of supply chain actors through training
- The generation of further learning regarding the barriers to retrofit work as well as successful engagement routes for different consumer groups and different parts of the supply chain
- The development of sustainable and scalable business models for retrofit and partnerships that will continue beyond the project period. Projects raised revenue by charging for various services – e.g. training, home assessment, obtaining installer quotes, coordination of works – though their charging models differed.
- An increase of retrofit projects, particularly multi-measure / whole-house retrofit, in project areas through the coordination of market players.
DBEIS commissioned Winning Moves to evaluate the scheme and determine the effectiveness of the regional schemes, as well as understanding lessons from them. The aim is not to produce a set of directly comparable findings, but to build the evidence base for future interventions on the supply chain and with the able-to-pay market, as well as to produce a set of valuable learnings.
The Solution
To approach the evaluation of the six regional schemes, Winning Moves drafted a detailed Theory of Change (ToC) at the outset, capturing our understanding of how the scheme was intended to work, the assumptions lying behind it and the social, cultural, economic and political factors that may affect outcomes. Accompanying this overarching ToC were six project-level ToCs setting out the intended customer journeys for each of the funded projects, and the assumptions underpinning them. We carried out interviews with the stakeholders across the supply chain, including:
- Project leads
- Delivery partners
- Supply chain installers and coordinators
- Customers
- Wider stakeholders.
We also carried out observation of events at governance meetings or supply chain training, a review of the Key Performance Indicators submitted monthly, and reviews of marketing materials and other relevant documentation.
The Outcome
We found that whilst the offers and customer journeys have differed, the successes, issues and learnings from across the projects had been remarkably similar and provide clear key findings and implications for BEIS. The timing of the project coincided with COVID-19 and Brexit, and it is hypothesised that both events produced negative consequences on the scheme. Those involved were uncertain which of these two events were responsible for the shortages of key equipment and supplies for retrofit, especially certain models of heat pumps, plasterboard and wood fibre insulation.
We identified two principal interdependent challenges for projects – customer retention and engaging the installer supply chain. Although customer interest was good, the conversion of interest to on-site retrofit was far more challenging. Whilst potential customers had dropped out of the customer journey because they did not want whole-house retrofits, and / or baulked at the costs of home assessment and measure installation, drop-out was also been caused by delays to the customer journey due to a lack of installers. While it had been relatively straightforward for projects to engage firms installing specialist measures (renewables in particular), it was much harder to engage the more generalist builders who were integral to the whole-house retrofit approach.
Despite the challenges, the scheme produced several positive outcomes:
- Significant numbers of retrofit supply chain firms have received training to better enable them to deliver retrofit to a higher standard.
- Household customer satisfaction with the support provided is high across the demonstration projects.
- Across the demonstration projects, a range of marketing collateral, targeting both customers and the supply chain, have been developed.
- Demonstration projects have also designed, tested, refined and launched online registration and home assessment platforms that make the early stages of the customer journey to installation more efficient.
- Finally, the demonstration projects have fulfilled their purpose in generating learning and insights. These are reflected throughout this report, but particularly in the penultimate chapter.
A lack of progress, if there is understanding of the reasons for it, is valuable. In terms of generating deeper insight on the barriers to successful customer and supply chain engagement, as well as informing the assessment and design of future schemes and / or wider policy, the demonstration projects have been valuable. Through the experience of project design and delivery, the demonstration project teams, and wider stakeholders have provided a number of ideas and recommendations for BEIS on how the wider policy environment could be, and perhaps needs to be, adapted to better overcome public and supply chain indifference and realise the UK’s domestic retrofit, and wider net zero, ambitions.