The report, entitled A Profitable & Resource Efficient Future: Catalysing Retrofit Finance & Investing in Commercial Real Estate, recommends practical steps government leaders can take to stimulate investment in energy efficiency upgrades to commercial buildings enabling job creation and green growth. The retrofit market has an estimated value of US$400 billion in the United States alone, creating 600,000–900,000 new green jobs while reducing energy usage by 29% by 2020.

The report recognises that, like the home insulation sector, there is a general market failure to price and incentivise the retrofitting of commercial buildings. Government leadership is all that is required to unlock the business potential of the commercial retrofit industry.

One of the key recommendations of the report is for government-mandated and standardised energy consumption reporting – an efficiency rating system for buildings. When combined with additional policies such as tax incentives, loan guarantees or credit enhancements, the information generated by such a reporting and rating system can help potential investors make better decisions to invest in energy efficiency projects.

Australia was found to have the most mature retrofit market as a result of a long-standing reporting and rating system, coupled with government-led action, including tax deductions and a third party institution to host demonstration projects.

The Green Party has taken the lead in the residential sector with our Heat Smart home insulation programme. We’ve announced new policy to energy rate rental properties, make this information publicly available, and then implement minimum energy efficiency standards to help drive investment. The World Economic Forum’s report rates this approach as best practice.

The potential for green job creation retrofitting our commercial building stock here in New Zealand is huge, but if we don’t move quickly, it will be Australian companies that secure a lion’s share of the market here and abroad.

Russel

World Economic Forum graphic

So far, it is an unmitigated success, with over 50,000 homes getting much needed insulation over the last fiscal year.

I want to pass the big kudos to Jeanette Fitzsimons, who had the foresight to establish EECA via her member’s bill in 2000, and who then helped them painstakingly set up a robust insulation programme with a well tested oversight system. Because of this, the ramp up to 50,000 homes per year has barely had a hiccup.

I also want to pass some kudos to John Key, who had the courage to ressurect the programme after Nick Smith’s ignorant off the cuff comment during an election debate forced National to kill the insulation programme after the election.

This insulation programme is a winner. The Greens have campaigned for years on the economic, social and environmental benefits of such a programme, and recognise it as a key plank in any Green New Deal as it is addressing both the climate crisis and the economic crisis at the same time.

Yesterday, our co-leader Russel Norman and the Prime Minister took a tour of  TerraLana, a wool insulation manufacturer benefiting from the scheme.

If the Government had the courage to look at our other Green New Deal programmes, NZ would be well on the way to a brighter, healthier future!

First of all, after a thorough hop around the corridors of power, I am pretty confident it didn’t come from the Green side. There were only three people with the knowledge, and frankly, if it had been a true insider, the leak would have been more accurate. Would New Zealand’s most trusted politician do such a thing?

Here’s what Jeanette had to say about the insulation programme on Morning Report.

The first so-called factoid is that the Greens settled for less than they did with Labour. That was immediately followed up by the assertion that the $billion dollars was over ten years now instead of fifteen, so it is, in fact, a better deal than the one with Labour. That sort of contradiction is what leads me to believe it was a lessor soul who leaked things to be malicious, rather than someone who understands the deal.

TV3 said last night that it would be about $300 – 330 million in the budget. Labour agreed to a billion over fifteen years, which averages about $66.7 million a year, with a bit of a ramp up in the beginning. If the Nats are doing $330 million over the first four years, that’s an average of $84 million per year on top of what is already budgeted for in the existing EnergyWise Homes fund.  That sounds good to me, and is a better deal for everyone.

I haven’t been able to get our folks to squeak, except to say that Jeanette is happy with the arrangements and I’ll have to wait until tomorrow. My money is on Jeanette, so I think it will be as good or better than last year’s deal. So much for the inside scoop.

I have also heard all kinds of rumours that rental homes might be left out. Somehow I doubt that, given that Jeanette spent so much of her time as Government Spokesperson for Energy Efficiency talking up the existing insulation scheme for landlords. Because of her efforts,  it has recently taken off, so I can’t see them scrapping that.

What I do know is that without fail, every press release I have seen has sung its praises, even if the facts haven’t all agreed. That’s because this programme is a no-brainer, whatever your ideology.

If the announcement is anything like the new money for insulation that we put into our Green New Deal Stimulus Package, there will 1400 new jobs coming from it, as well as preserving the existing jobs in the EnergyWise insulation programme.

Oh well. Our Stimulus Package would create up to 48,000 jobs. Only 46,600 to go, but this is a good start!

The maddest idea has to be the “rule-making freeze” – proposing to stop all rule and regulation making or extension (unless specifically approved by the minister),  and reduce all enforcement activity to focus on minimum acceptable standards (rather than ‘nice to haves’) and the overall immediate interest for New Zealand.

Barry Weeber from the Environment and Conservation Organisations of New Zealand (ECO) responded that such a moratorium would trade human and environmental health for short term economic gain, and that the environmental initiatives flowing from water and air quality regulation are exactly the sort of job-creating projects we need – like home insulation and clean heating.

On the proposal to spend $60 million in promoting tourists he said “it will be undermined by any moves to downgrade environmental protection.” He said “we want tourists to come here but the Job Summit is saying they shouldn’t drink the water or breathe the air”.

He ended: “New Zealand should be investing in greening the economy to provide jobs and to improve environment.”

I couldn’t agree more!

HOW TO cut heating bills, reduce carbon emissions and create thousands of jobs in the construction sector in the process? The Government, through its national insulation programme, has pointed the way. At a cost of €100 million in 2009, this investment in greater energy efficiency is worthwhile. It makes sense for the taxpayer and the householder. It is good for the environment and it provides a small but significant boost for the economy that is set to contract sharply this year. As Minister for Energy Eamon Ryan said in launching the initiative: “this insulation programme saves energy, saves money and creates jobs”.
The €100 million scheme will, it is expected, employ 4,000 people and benefit some 50,000 homes this year. It consists of two grant schemes, each receiving €50 million. Beneficiaries will be those in private middle- income and private low-income homes, including local authority houses. The country’s housing stock amounts to 1.7 million homes. One million of these houses, it is estimated, need some retrofitting to achieve energy savings. Although funding for the current scheme is not yet guaranteed for 2010, the economics of the insulation programme are compelling.

That sounds an awful lot like the insulation scheme the Greens won as part of the Emissions Trading Scheme (ETS) negotiations, which would have been funded by the windfall profits of the SOE electricity generators as a result of the ETS. John Key can say all he wants to about it being unfunded, but that is simply not true. (audio link, post-cab)

I am pretty confident that when the government announces their infrastructure scheme tomorrow, it will contain something of a re-hashed and re-branded Green insulation scheme. The question is, will it be bold enough? As all governments have recognised, the economic benefits of warm healthy homes are irrefutable. The numbers stack up. So why is it so hard for the government to admit that they got it wrong?

Senator Brown said the injection of new ideas in politics around the world was coming from the Greens and there was never a time when the Greens were more needed than 2008 in the face of an economic collapse.

Without environmental and sustainable policies, the economies of the world would continue to struggle.

Green policies were helping feed the world, he said.

Labour conveniently released some environmental policy while lunch was being served.

Ms Fitzsimons said the policy seemed to be what Labour had done, not what it was going to do.

And she was “amused” to find Labour claiming credit for the $1 billion spent on retrofitting cold and damp houses and introducing biofuels legislation with a sustainability clause.

“So, they are Labour policies now. I sat across the table and pushed and pushed and pushed for the $1 billion and ended up with 20 times more than Labour was initially going to give us and we only agreed on the Biofuels Bill after we wrote in the sustainability clauses.

When they proved too inept to write it themselves, we wrote it.

“Labour is desperately grasping at Green ideas. If we are in government with them, we will give them heaps of Green ideas and get them into law.”

Speaking at the Oxfam Climate Change Debate, Smith was pressured by Minister Parker as to whether National would keep the fund. After several blustery answers, the audience and Jeanette got into the act, demanding that Smith answer the question. Finally, the old fossil caved in and admitted that the fund would go.

When pressed as to his reasons for killing the fund, Smith blustered (paraphrased) ¨We wont guarantee anything agreed between Labour and the Greens.”

What Smith revealed is what I have suspected all along. We are hearing many soothing words from the front bench of National in the lead up to the election about how they have changed their ways and how they plan to keep so many of this governmentś programmes. In the usual pattern, it is in a moment of rare honesty that we see that the leopard has not changed his spots at all. Itś the same old plan from the same old party. Slash and burn.

We need to invest in the infrastructure of the future, which includes warm, dry homes for all New Zealanders while the cold winds of global recession blow through the land. How better to prepare for this recesion, peak oil and climate change than to get every home in NZ properly insulated?

Well, what I have learnt from that is that Peter Dunne doesn’t buy free range eggs.

As the Dominion Post notes it’s dangerous to take that number and divide it equally among all households because that’s not how the money will be actually divvied out, with the package split between the universal and targeted payments.

Dunne’s correct that $180 million is not a huge amount of money in the context of the Emissions Trading Scheme.  However, the $1 billion insulation package that the Greens negotiated for energy efficient, warmer, dryer kiwi homes is.  Dunne could buy more than a few battery hen eggs for that. In fact, for every dollar spent on the insulation programme, the return will be about $5. Not a bad return on investment.

Professor Philippa-Howden Chapman says of the establishment of a $1 billion fund to insulate every house in NZ as part of the Government’s climate change policy: “This is an extraordinary example of a creative shift in thinking that truly places New Zealand in the twenty-first century.”

“Insulating all houses and reducing fuel poverty by compensating residential electricity users for raised prices should lead to evident health benefits for all New Zealanders.”

He Kainga Oranga has some interesting research on the health impacts of crowding, insulation and heating of New Zealand houses.   Its work suggests that there are 1600 excess deaths in winter when the temperature drops, compared to summer.

This is a similar move to the Dutch, who used the proceeds of North Sea Gas finds to centrally heat all homes in the Netherlands in the mid-1970s and were able to track an associated improvement in life expectancy.

“The present poor energy efficiency of our houses in New Zealand has had serious public health consequences,” Professor Howden-Chapman says. “Many of our homes were built in the late 19th century and the early part of the 20th, when energy seemed so cheap we just used lots of it. With the certainty of climate change, we don’t have the luxury of doing that any more.”

And here’s a view you may not have heard in among all the strategic political noise about game playing:

“This political deal is an example of rational policy making at its best.  It puts in place a policy which deals with bad environmental consequences of energy inefficient houses by insulating them, which has been repeatedly shown to be the most cost-effective policy for reducing climate change.”

Housing New Zealand has been running a programme to progressively retrofit uninsulated state homes with energy efficient material since 2001. So far it has done this to about 16,500 homes. This has meant ceiling and underfloor insulation, ground moisture barriers, cylinder wraps and lagging on some hot water pipes, draft stop seals to doors and windows, installation of water efficient shower heads, energy efficient light bulbs and energy efficiency heaters.

Jeanette has just won a budget bid to fast track this project with $53.4 million. This will help retrofit a further 21,000 state homes in the next five years. This is double the current rate of progress.

In a win-win outcome, tenants will benefit both from electricity savings and improved health:

“The Greens see this as an investment in the future health of New Zealanders. We estimate that the country will recover this investment four-fold in 20 years in energy and health savings.

“Research indicates that insulated homes use on average a fifth less energy than uninsulated homes.  People report health improvements, including half the number of respiratory symptoms. Children in insulated houses had half the number of days off school.”