Renegade Conservatory Guy

Climate change - bad news for the world but could it be good news for the double glazing industry?

Energy Savings Trust Report

A recent report about the UK glazing sector paints a depressing picture if you’re the owner of a double glazing company. Although, if you run a double glazing company, you probably already know this!

The report, commissioned by the Energy Saving Trust and the Energy Efficiency Partnership for Homes, points out that the UK windows market declined from 10.12 million units in 2003 to 9.2 million in 2006, and a projection of only 9.02 million this year. This is a decline of 12% over 4 years in a growing economy.

There was slight growth in the door market from 1.98 million units to 1.99 million in 2006, but conservatories have also performed badly. Conservatory sales in 2006 accounted for 205,000 units, compared to only 187,000 last year, but with projections of 196,000 in 2007. These figures were supplied by Palmer Market Research.

Coinciding with this reduction in demand for windows and conservatories, raw materials and manufacturing costs have been rising steadily during the last two to three years, while ongoing price competition has depressed prices for replacement windows. Suppliers throughout the supply chain have had to absorb cost increases, which has eroded margins and resulted in considerable restructuring in the supply chain.

This is great news if you are looking to get a quote for double glazing or a conservatory, as there’ll be some great deals around, but very bad news for a fragile industry.

Saturation of the market is a key issue with a very high percentage of homes in the private sector now fitted with replacement windows - although these may not necessarily be energy efficient windows. This saturation is likely to continue for the short to medium term. It’s not difficult to see ’saturation’ with a quick drive around any housing estate.

In 1976 fewer than 10% of existing homes had double glazing in one or more rooms. In 2004 market penetration reached almost 83%.

Time to exit the industry then?

Well, not necessarily. Read on:

The total UK residential energy efficiency market inclusive of double glazing, central heating and building thermal insulation, will increase by around 10% between 2006 and 2009, driven by construction sector growth, the Energy White Paper as well as current and future changes in building regulations.

Heating and hot water in housing make up around 25% of total national energy consumption, and at the same time emissions from domestic buildings account for some 27% of all UK carbon emissions. An estimated 9.5 million windows are replaced each year in the UK, and if these replacements were all Energy Saving Recommended (ESR) products, around 285 million kilowatt hours of energy per annum could be saved.

In addition:

- Poorly insulated window frames and single glazed windows account for up to 20% of heat loss in the average home. Double glazing cuts heat loss and also reduces noise and condensation problems.

- Installing double glazing can cut heating bills by £80 - £100 a year and 680 kilograms of CO2 (or four double decker buses full of CO2) each year.

- If everyone in the UK who could install double glazing actually did so, it would save £500 million and 3.5 million tonnes of CO2.

Across all of the UK, 38% of the housing stock is estimated to have been built before 1945 and is therefore at least 60 years old. This fact has significant implications on energy efficiency as, broadly speaking, the older a property is the less energy efficient it is.

Continuous media coverage is slowly changing the public’s opinion about climate change and global warming. New research from the Energy Saving Trust (EST) has found that nearly 70% of British people believe that energy efficiency is important when buying a home. Almost half (45%) are willing to pay up to £10,000 more for an environmentally friendly home.

So, I see two opportunities:

If the double glazing industry is able to harness this consumer interest for energy efficiency then demand for energy rated windows should increase. As an industry we need to adopt these more energy efficient windows to a greater extent, and then educate the public through advertising and marketing initiatives.

By educating the consumer then suppliers of non-energy efficient windows will be forced to fall into line, or see sales and profits decline.

Secondly, the Government is going to be forced to take drastic action to reduce carbon emissions, and energy efficient windows will have to play a part in the Government achieving targets.

The government must create legislation which promotes energy efficient windows (and doors) or create incentives to the industry to produce more energy rated windows. I have personally put my name to a campaign to reduce VAT to 5% for such windows and my gut feeling is the Government will have to consider this.

Since 1998 the government has offered a reduced rate of VAT (5%) for micro-renewable technologies and energy saving materials to encourage investment in domestic energy efficiency, but not energy efficient windows. There is no doubt that a lack of trust of the double glazing industry as a whole, combined with a potential loss of taxable income of around £490m per annum, is the reason our industry has been overlooked.

But, I have faith, that as more research continues to highlight the real problem of climate change, the Government and the World will have to embrace energy efficiency at a faster rate.

And this will be a real shot in the arm for the window industry!