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Steven currently manages both our Heat Insight Service and Gas Heating Service, leading our research in each of these fields. He joined us from Energy Saving Scotland / Changeworks in 2011, where he worked as an Energy Advisor. 

Steven holds an MSc (Distinction) in Climate Change: Impacts and Mitigation from Heriot-Watt University and an MA (Hons) in Geography from the University of Edinburgh.

Low-carbon at the coal face: Delta-ee’s newest report reveals what installers really think about the microgeneration sector

The newest report from Delta-ee’s ‘Microgen Insight Service’ comprises our analysis of the 250 responses to our nationwide Installer Survey, offering the most up to date investigation of installer attitudes towards – and their experiences of – microgen technologies. The full report takes a deep dive into all aspects of the installation process, delivering key insights on what factors are really shaping the views of installers (and also their customers) about domestic renewables and what product suppliers must do to enable greater engagement from them. Here, we offer a brief summary of three of our key report findings.

The 2013 Installer Survey Report

Central to every sale – and critically, a key influence on product choice – installers, from a range of product specialities and geographical locations, are the subject of the latest primary research from the MIS. 250 of them responded to our call to share their experiences of the UK heating market:

With the majority of the sample survey having over 10 years industry experience, the data also reveals valuable insight about the awareness of microgeneration incentive schemes and how the different technologies are favoured by those at the installation front line.  Our analysis revealed a multitude of industry trends – some to be expected, some far more surprising! Below are just a few of the most interesting...
Installers know their customers well – but are suppliers delivering what customers really want?

Understanding customer drivers is a key concern for product manufacturers. Reassuringly, Delta-ee’s research shows that equipment installers know their customers well; their take on the key customer drivers echoes what we found previously, direct from end-users. Installers confirmed that the desire to reduce running costs is the main customer driver for fitting microgen. At a time of increased political debate surrounding the sharp rises in energy prices (see e.g. here), the report highlights the opportunity microgen players can take to demonstrate their products’ resilience in the face of inflation-excelling fossil fuel prices. Although, because installer drivers vary as much as their customers’ drivers do, understanding the different target audiences for microgen products will be critical; more detail on which can be found in our full write-up.
Many installers remain unenthused about the Renewable Heat Incentive (RHI), and the impact appears to be weak – should DECC be concerned?

With only 50% of installers who currently cab fit both conventional heating and renewable systems even aware of what is arguably the single-most important policy piece for low carbon heat in the UK, Delta-ee’s Installer Survey Report highlights a key threat to the sector’s ability to capitalise on the RHI scheme. If installers themselves are not adequately aware of the full range of offers available, how can customers make fully informed investments?  And, if those who are aware are personally indifferent, how will they sell the value on to potential customers?

Q. 21)    Has the recent announcement about the Renewable Heat Incentive made you more or less likely to want to install renewables in future?

The Installer Report demonstrates the need for product manufacturers and policy makers to really sell the full opportunity the RHI offers to installers as much as customers. Today the impact has largely been weak, possibly due to a lack of understanding or uncertainty surrounding the scheme’s delivery. The RHI can only avoid the disappointing fate of the Green Deal if the entire supply chain is working together.
Feedback highlights key supply chain issues: Are opportunities to sell microgen being lost?

Installers are undoubtedly the main point of call for customers making their installation choices, be they strategically planned or hastily taken (a further revealing topic explored in the report). But, focusing on the role of the installer as an influential source of advice, we have learned that, too often, customer enquiries for microgen systems are not being converted. Even among installers of purely conventional system, as many as 1 in 10 installs involve a microgen enquiry, and the figure is understandably far higher among those offering renewables. Effectively, we believe this demonstrates how more consumers are beginning to engage with microgeneration. Yet, alarmingly, (far) fewer than half of all these enquiries result in a microgen technology being fitted.

Together with other aspects of installer engagement, such as the most important factors shaping their own decisions on whether a property is suitable for microgen, this research highlights the crucial role installers hold in shaping – and clearly sometimes obstructing – customer uptake of microgen. Rectifying such obstructions is crucial for growing the market for renewable solutions, and therefore the report pays considerable attention to which strategies will work best.

Delta-ee’s market leading Microgen Insight Service

Offering extensive coverage across all the key customer groups, Delta-ee’s Microgen Insight Service (MIS) is a subscription-based research service designed around the needs of manufacturers, distributors/suppliers and retailers of microgeneration technologies. By combining primary research (with owner-occupiers, installers, social landlords and housing developers) with detailed techno-economic analysis, the MIS provides the most comprehensive account of the latest trends in the microgeneration industry, drawing out the all-important conclusions / ‘so what’s’ to inform our clients’ commercial strategies.

For further information on the Installer Report and Delta-ee’s Microgen Insight Service please contact:

[email protected];    +44 (0)131 625 1009
[email protected];    +44 (0)131 625 1003
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The UK Self Build Sector: In decline, but of increasing importance for microgeneration sales

Delta Energy & Environment’s latest Microgen Insight Service report on the UK Self Build market reveals a marked decline in the number of completions in 2012. Should the microgen industry be worried about the state of one of its key niches?  We’re optimistic that, with the aid of measures such as the RHI, the market outlook for this sector will sufficiently improve.

Self build stats give cause for concern, although Delta-ee sees the microgen opportunity being sustained.

The figures are concerning; the annual number of self build completions fell by 25% in 2012. Serving as an indicator of market health around 2 years previous, the latest statistics reflect a contraction largely in line with the difficulties facing the housing market as a whole in 2010/11. Those who we spoke with, including the National Self Build Association (NaSBA) highlighted how people hoping to undertake their own project faced a particularly challenging credit scene.  So, is it as doom and gloom as the figures suggest?  And what does this slump in one of their key markets mean for microgen vendors?  Currently, around 1-in-3 self builders install (at least) one microgeneration system and, despite the fall in the number of them, we expect their level of interest to be maintained – and even increase – over the coming years.

In recent years the government, along with a handful of industry insiders including newly appointed ‘Champion of the Self Build Industry’, Kevin McCloud, has committed to a range of measures targeted at doubling the number of self builds by 2025.  Such initiatives include the Custom Build Investment Fund, which, administered by the Homes and Communities Agency, provides £30 million worth of funding for self build projects.  These drivers, along with DECC’s recent decision to grant self builders eligibility for the RHI, lead Delta-ee to conclude that this sector should remain an important destination for microgen products. 

A simplified passage through the RHI should facilitate greater engagement with renewable heat from self builders.

In principle, the Renewable Heat Incentive offers a real opportunity for manufacturers to increase uptake rates amongst self builders. This group typically has an above average income, is made up of people designing their once in a lifetime dream home and, most importantly, is disproportionately open to innovative and environmentally-savvy technologies.  Our customer research shows that self builders are primarily driven by economic motivations to install low-carbon technologies, however many are also attracted by the ethical merits as a secondary driver.  In particular we see the added incentive of a <7 year payback buoying interest for products whose self build sales are crucial – namely biomass boilers and ground source heat pumps.  Plus, with their brand new EPCs expected to stand in lieu of a Green Deal assessment, self builders should be in line for the simplest customer journey of the lot.

Undeniably, a smaller pool of self builders equates to a smaller pool of potential microgren customers.  But based on what we’re hearing from/seeing in the market, self builds should remain a key target audience for most microgen manufacturers.  Delta-ee’s latest residential market forecast sees annual microgen installations in self builds rising by 75% to around 7,500 in 2016.  Capitalising on such potential of course will require market players to develop a clear understanding of self builder preferences and their concerns in order to formulate a winning market strategy.

For further insight from our report on the state of the self build market, and the outlook for microgen across all end-user groups, please click here.

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