Written evidence submitted by Vaillant [PNZ 063]

The Vaillant Group – Who We Are

The Vaillant Group is a global market and technology leader in the fields of heating, ventilation and air-conditioning technology. For over 140 years, we have been following a strategy designed to achieve sustainable and profitable growth. Today, our family-owned company has 10 sites in 6 European countries and China.

Vaillant Group UK is working to deliver both hydrogen ready boilers and heat pump system solutions to support the decarbonisation of heat in homes and meet the UK’s net-zero targets. Our UK HQ and manufacturing facility is in Belper, Derbyshire. We have over 20,000 Installer customers in the UK, 7 regional training centres or ‘Centres of Excellence’ for training our Installers and are committed to delivering low-carbon heating.

Founded in Remscheid, Germany, in 1874, the Vaillant Group today supplies innovative hot water, room heating and cooling solutions to countries all over the world. Our company develops high efficiency products that save energy, conserve resources and enhance people’s quality of living.

As a business we take responsibility for “Taking care of a better climate” – to safeguard the home of millions of people and the environment. All of our employees are working to achieve this shared vision. It is both our ambition and our common goal.

Innovation and sustainability are at the heart of everything which Vaillant does as a business. The Vaillant Group is becoming climate-neutral, and we have developed an ambitious long term climate strategy, which focuses on the following areas;

• Climate-neutral this year thanks to afforestation projects
• Company’s own CO2 emissions to be halved by 2030
• The Vaillant Group is thus supporting the aims of the United Nations and the EU on climate protection and sustainable development

Further information can be found on this link;

https://www.youtube.com/watch?v=Dmd8JjYRYrI&feature=youtu.be

New homes: the Future Homes Standard and Future Buildings Standards

• Do the government’s proposals for improving the energy efficiency of new homes by 2025 go far enough?

In theory, yes. New build has to act now and start to fit low carbon heating system immediately, as opposed to fossil fuel alternatives. Every property which is fitted with a fossil fuelled heating system is a retrofit later down the line, which is more costly and disruptive. Essentially there are going to be over circa 800,000 new build properties built between now and the end of 2024, which is a sizeable amount to have to revisit to upgrade.  This should be brought into legislation as soon as possible for residential new build properties.  Commercial buildings should be phased in the reduction of direct emissions, as to allow the supply chain to embrace the technology required for this transition.  Within these new build properties, a fabric first approach is crucial in terms of saving energy.

Heat pumps are only a part solution to decarbonisation, reduction of energy usage within the building as much as possible, and then apply a low carbon heating system to remove emissions. We need to reduce primary energy for heating as much as possible by ensuring a high bar is set for the backstop of fabric.

With the likely adoption moving forward of technologies such as Air Source Heat Pumps to meet the requirements, the ability to reduce the quality of the fabric elements towards their backstop values will become a financial option for the builder. This is possible because by calculation it can be demonstrated that building with an Air source heat pump can achieve a pass rate in excess of 70%. This may not promote the best fabric first approach and could mean that buildings are not as efficient as they could be.  We believe that the backstop values should be improved to prevent underperforming fabric being utilised when renewable technologies are being used that easily meet the requirements of the regulations.

More efficient fabric leads to more efficient use of technology and hence lower consumer costs.

Many builders are currently building to fabric U values to meet current regulations with a gas boiler, so we do not see this as either a big challenge or a significant financial burden.

• The government has acknowledged the need to clarify the role of local planning authorities in setting energy efficiency requirements for new homes that go beyond the minimum standards. What role should LPAs play in determining local energy efficiency standards?

Vaillant are in support of local authorities meeting and exceeding building standards.  The Heating and Building Strategy should set out clearly the future for new build homes and reward those that meet these future requirements earlier. For example by adopting a rating system of one, two and three stars. These rewards should be based on a nationally recognised scheme and award tiered levels according to improvements of innovation in fabric, technology and skills.  This is a national approach to deliver local targets.  In summary, Vaillant would welcome the introduction of a rating scheme along similar lines to those used in section 7 of the Scottish Building Standards.

• Is the government right to anticipate that heat pumps will become the primary heating technology for new homes?

Government must remain technology agnostic to all technologies which are zero direct emissions.  Heat pumps are the immediate solution and should be used now as they are best suited in newbuild installations where they can be accurately specified and designed as an integral part of the home design. For new build homes, greater efficiencies, both from a cost and carbon perspective, can be gained from heat pumps being installed from day one. 

Vaillant believe that 100% hydrogen is a viable solution for new homes and should play a role in the overall fuel mix, but as it stands today we have no roadmap of what a hydrogen roll out into the gas grid could look like, nor do we have commitment from Government that this roll out will happen.  Until a hydrogen roadmap is available we are unable to work out its fit in our future technology mix and in the meantime heat pumps should be considered the primary heating technology for new homes.

• Will the proposals address the performance gap between design intent and build quality of new homes?

Although the Building Regulations Part L are a step in the right direction, they do not guarantee a quality improvement.  What will bridge the gap between design and build quality is acquired skills and education, this needs to be a focus of government going forward. 

• Is the government right to introduce revised transitional arrangements? In addition, the Committee seeks evidence on any other issues relating to either the Future Homes Standard or the Future Buildings Standards.

The sooner we implement new standards the sooner we will get to net zero.  The shortening of the transition period will require industry engagement and support in order to facilitate a smooth chain.  In terms of product options heat pumps are a tried and tested technology, however other areas of the supply chain propose some bottlenecks, i.e, installers, electricians, and the electrical grid to name a few. There areas which need addressing quickly.  Firstly the installer network needs skills and training.  Secondly builders have a responsibility for delivery of government objectives, and they need to be making preparation now.

Existing homes

The Committee also seeks evidence on plans for improving the energy efficiency of the existing housing stock, including:

• Local authorities’ progress towards reducing or eliminating the carbon footprint of their own building estate.

Vaillant have written a white paper which explores the energy efficiency improvements of the existing housing stock, and would welcome further discussion with MHCLG on this.

We acknowledge that there is huge importance in the reduction of energy waste now. We must tackle the waste problem we have today, whatever is not reduced now will need further investment in the future for low-carbon generation.

The banning of properties with an EPC band lower than C by 2028 is a step in the right direction, but we feel there is scope to move forward with further EPC stipulations. We would welcome the introduction of improved targets for the social housing sector.

• The role of local authorities in improving the energy efficiency of non-council building stock, including through take-up of the Local Authority Delivery scheme and the setting and enforcing of energy efficiency standards.

Vaillant support the wider drive towards EPC band C and local authorities should be the key enforcers of this activity.

• The role of local authorities in encouraging and enabling private owners to reduce or eliminate their carbon emissions, including through the development of loan schemes similar to the green deal and the delivery of existing grants, such as the Disabled Facilities Grant and Housing Renewal Assistance.

There is scope here to link the EPC value of properties to a council tax band, therefore homeowners with lower EPC properties would pay more, and we feel this could prompt a movement towards housing improvements, if funding is readily available.

To enable penetration of heat pumps into the on-gas grid retrofit market any incentive, would be required to enable proactive replacement of boilers rather than distress replacements, should be targeted towards those system and open vented boilers which are likely to require fewer system upgrades to facilitate the installation of a heat pump, closing the additional on-cost of the heat pump system over a boiler exchange. Hence, support for cylinder upgrades should also be considered. This could be a cylinder scrappage scheme or a discount voucher for installation of a ‘low carbon ready’ cylinder.

• The role of MHCLG in making the existing housing stock more energy efficient, including through its review of the Decent Homes Standard.

With a view to the government’s decarbonisation targets by 2050, Vaillant recognises that we have a diverse building stock.  Some of these properties will be considered as ‘hard to treat’ properties whereby it is not economically feasible to install a heat pump.  In this scenario Vaillant recommend acknowledge the strength of using hybrid systems.  Hybrid heat pumps are a key option to decarbonise heating systems, with a heat pump fitted together with a gas boiler (initially natural gas and, in future, hydrogen) – provided incentives support the installation of heat pumps as an upgrade and the installation of the correct controls to optimise the use of each technology for maximum efficiency and low carbon. This could be the best solution for an incumbent combi boiler system in a first step. The second step in future would be less cost/disruption if the homeowner subsequently wanted to move to a full heat pump system. In this instance, support needs to be given to incentivise and cover the additional cost of the heat pump compared to a straight boiler swap.

Vaillant would welcome further discussion on the topics raised in this submission.

May 2021