video Podcast Episode 16

Craig Stirrat from Grampian HA

This week, we're talking with Craig Stirrat, the Chief Operating Officer at Grampian Housing Association. We talk about how realistic the goal of reaching a Net Zero status before 2050 is, what is needed for a successful Net Zero strategy and the importance of technology to the sector.

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Podcast Transcript

Alastair:
Hello and welcome to another Switchee podcast. We're joined today by Craig Stirrat from Grampian Housing Association. Grampian is based up in the Northeast of Scotland in and around the Aberdeenshire area and I’m particularly excited to have Craig on as the first representative of Scottish Housing that we've had on the podcast. So thank you very much for joining us, Craig.

Craig:
Delighted to be here.

Alastair:
Good stuff. Beaming in from a cold Aberdeenshire at the moment whilst the sun's been away.

Craig:
Absolutely.

Alastair:
I just wanted to start by asking you a little bit about how you got involved in the housing sector. I know sometimes people take a wandering weaving route into it. So how did you get involved in housing in the first place?

Craig:
Well, it's so cliché, I sort of fell into it. I was actually studying a postgraduate in town and country planning and I felt I needed some grassroots experience. So I managed to secure a student intern position in an area of Edinburgh called Fountainbridge, which if those that know anything about Sean Connery that's where he grew up. I was quite delighted to get the opportunity to spend some time in what was an enveloping rehabilitation of traditional tournaments. So I was able to cut my teeth on housing there and then an opportunity came up with the former Kirkcaldy District Council for a graduate trainee manager position and the rest is history.

Alastair:
Fantastic. And I guess we can't really go any further in the conversation than bringing up the dreaded net zero. We've been talking to a lot of housing providers over the last few months and it seems to be on everybody's agenda and strategy. Maybe the first question is with regards to the targets that the Scottish government have put in place, do you actually think that they're realistic? Are they achievable for you? I think you're one step ahead of the English guys coming in at 2045, is that correct?

Craig:
Absolutely. We want to be there first. Yes, the target is 2045 to achieve net-zero and I like to think I’m cautiously optimistic based on what I’ve seen happen so far. For instance, in 2020 the Scottish government just missed its targets for generating 100% of renewables, sorry electricity from renewables. What it did achieve was 100% of its net carbon emissions and that was largely down a lockdown - people not using the vehicles. So a lot of optimism there that these were tight targets set back in 2011 and at a national level these were achieved. For social landlords themselves, we were required to achieve EESSH one by December 2020. EESSH is the energy efficiency for social housing and that was to achieve an average energy rating for properties of 'C' category. Now as I understand at the end of last year, it was reported to the regulator that 91% of housing associations in Scotland had actually achieved an average rating of 'C'. So I think that's a pretty good measure of things to come.

In Grampian Housing Association itself, we achieved 97%. The other 3% were those properties that were exemptions. You can have exemptions because it's just not economic for instance to bring a property up to standard. So we think that was a good result. The big challenge however is going to be in the next stage and that's to achieve EESSH 2, which is to get an average energy rating of B for all our properties. Now that's a bigger step for us than what we achieved for EESSH 1 and that's to be achieved by 2032 and as we also know gas central heating is to be abolished by 2035. So notwithstanding that we're installing gas central heating now that will still be in place by 2032. Very soon we're gonna have to find an alternative cost-effective solution for our tenants.

The key thing for us in terms of net-zero is that as far as I’m aware, it hasn't really been defined what that means. So we're taking it as an opportunity to reduce carbon production. So notwithstanding that we're trying to reduce carbon production from our own homes, we're intending to achieve that by a range of measures and one of the main measures that we've been using this year and last year is the planting of trees. Last year, we planted over 300 trees and we've got plans to plant more trees. We're also reviewing our sustainability strategy which includes encouraging staff to think about how they travel. So from using public transport to cycling to taking advantage of electric or hydrogen-powered vehicles.

Aberdeen city council is investing a lot in hydrogen up here because there are plans to produce green hydrogen using renewable sources, wind power off the north sea. So there's a lot of opportunities coming our way and the big challenge at the end of the day for all social landlords is to achieve net-zero without causing fuel poverty by using more costly heating systems that would in turn make tenants poorer than better off.

Alastair:
Yeah. I think you've sort of hit the nail on the head with some of the concerns that we're having when we see this is that a good way to get there is to put some great technology in like ground source heat pumps and air source heat pumps but there's a fine balance given the fabric of the building, how it would be used, what the ability is to switch to cheaper energy tariffs and things like that. That fine balance between yes, you might hit your carbon reduction targets but you're leaving people in more poverty than when started. Craig, I wanted to ask you we do look from the side-lines sometimes and think you know, that the Scots have got a bit further down the line than some of the other housing associations in the UK which is a good thing and I wanted to ask you, you know what measures have you used to take you from the D's to the C’s, what are your plans to get from the C’s to the B’s on your EPCs as well? What kind of projects and measures have you got planned?

Craig:
Well, can I just give a bit of a context of what's happened in the Aberdeen area? Almost 15 years ago, we pioneered a combined heat with power system to tackle fuel poverty in our multi-stories. Aberdeen City Council has 59 multi-stories. Most local authorities in Scotland are demolishing them but the multi-stories in Aberdeen have been quite successful but the problem is they're hard to heat and there are real challenges for individuals to keep warm. So, we did an options appraisal when I was at the council 15 years ago and the best option that came up, the most cost-effective, the single cost-effective option was to install combined heat and power. Just before that, also we had an act in Scotland called “The Home Energy Conservation Act”: HECA And one of the things that we tried to pioneer in Scotland was home energy ratings. Now because it was voluntary at that time, it was very difficult to encourage the market to take it up but eventually, the Scottish government listened to it. So I like to think that we were quite pioneering in promoting home energy ratings for properties which eventually became legislation.

More recently in terms of what we've been doing in Grampian, again, necessity is the mother of invention and in some parts of Grampian, we don't actually have access to the gas network. So when we were building new houses we had to come up with a solution pretty quickly and that was air source heat pumps. Now that was quite innovative at the time. We're talking about, you know, about 8 to 10 years ago and one of the challenges that we didn't envisage at the time is that you had to have a specification that took into account the water that was in the area. So when we were drawing in water heat up, we didn't have proper filtration systems and the water was quite peaty in the area. So there was a lot of muck coming through and that was clogging up the systems. So we found out the hard way how you would go about installing proper heating systems using air source heat pump, which included providing guidance and education to our tenants on how is the most cost-effective way of using air source heat pumps.

So that was a hard lesson for both the tenants and ourselves but we invested in over 300 air source heat pumps at that time. The experiences we had with that made us think again before we decided to look at that as an option for replacement gas central heating. A primary purpose as I said is to achieve EESSH 1 which we did by December 2020. So that was largely based on gas central heating upgrades, more efficient boilers but, like many social landlords, we had a number of non-traditional houses. Properties in which there were no cavities. So we couldn't actually fill the cavities to improve the fabric insulation. So, what we did, we went for external wall insulation. Now that was a very successful project because this was aimed at houses that had been built in the 1950s which aesthetically were not looking very attractive now, you know, the windows were renewed, the doors were renewed but, they did look dated. But by and large, they were popular. So, when we put the external cladding on, it not only improved the energy efficiency of the properties and made the houses warmer for people, it also aesthetically improved the look of these properties and they are very, very attractive and they look like brand new houses. So that was one of the things that we did.

The other thing we did was that we installed about 500 PVs to provide cheap electricity during the day for tenants. The downside with that is in the rush to get the things installed and to get the benefits that we get with the tariffs. We didn't consider that, you know, a lot of tenants are actually out during the day. So therefore they're not getting the benefit and any energy generated was just going off to the grid. So the tenants weren't getting the direct benefit. So at that time, obviously battery storage was still quite in its infancy and the market hadn't reached the point where the prices were coming down but since then they have. So what we've been doing is retrofitting batteries to those PVs to store up the energy during the day, so that tenants can get the benefit of that at night. That's some of the key areas we've tackled to achieve EESSH 1, which is an average energy rating of 'C'.

Alastair:
That's fantastic. I think it's such an achievement getting to those levels already. I know from one of my colleagues that we're looking at a project with you guys that, is it Ballater? Am I pronouncing that correctly?

Craig:
Yes, Ballater the Royal Deeside.

Alastair:
Deeside, yes, that one. Have you put some ground source in or you're going to put some ground source in there?

Craig:
Yes. We're in the process of doing that one. One of the challenges obviously is that Ballater, you probably heard about Braemar being one of the coldest areas, that's where the royals lived during the autumn period. Braemar is quite cold, you know, extremely cold, below zero centigrade and so heating is a challenge in Ballater which is quite close to Braemar and the fact that providing gas central heating would be a major issue we had to come up with some renewable source that was also affordable. So what we've gone for are ground source heat pumps. Now, this is a project that is a refurbishment of an old school and schoolhouse that's also got new builds. So we're combining old with the new and the ground source heat pump is being put in at the moment and naturally, we are concerned about how that will work for tenants. So we are going to be in introducing Switchee controls to remotely assess the efficiency and the usage of the ground source heat pump.

It's not just because of lockdown but physically Ballater is at least an hour's drive away from Aberdeen and the roads are quite rural. So in winter, it will be extremely challenging to reach there. So having remote controls that can assist us to diagnose and communicate and guide the tenants on how to make the best use of the ground source heat pump when, you know, the snow's lying about 6 inches outside your front door, it's going to be vital for us to be responsive to attendance needs. And technology has to be the way to go.

Alastair:
Yeah. When you connect up properties, there are lots of benefits that people are aware of but you often find additional things that come about from that. So yeah, in that situation you think well let's control a ground source heat pump and maybe if we can see how it's being used, we can help residents to use it better. But then there's that added part of saying, well, the location of it is difficult to get to. So anything that you can do, where you don't have to send a person to go and do it, it builds the business case around it. You've kind of touched on this already Craig, but you've mentioned the kind of usage or behaviour element and I think with the net-zero and carbon reduction projects that are going on around the country, there's this debate around is it fabric first, is it bricks and sticks and technology that are going to get us there or is it going to be behaviour change and people and education and I wonder if you had the silver bullet for us Craig.

Craig:
If only I did, I’d be a millionaire. The approach that we are taking to net-zero has to be through strong leadership around sustainable development. And sustainable development does take into account social factors i.e. the people and it's not just the tenants as such there's going to be challenges around having sufficient qualified green installers, people who can install the renewables and maintain their renewables because we do have, you know, we've been talking about for years in the construction and maintenance sector that there's a time bomb of retirees coming. So there's going to be a lot of investment around the social side, creating green jobs. There's the economic side obviously because, you know, air source and ground source is a lot more expensive than gas central heating at least 3- or 4-times unit cost. So, you know, the payback in that has got to be funded somehow.

You can't provide social rent without a subsidy and similarly, you can't provide affordable heating without some sort of subsidy. So we are expecting in terms of economic terms, there will still be some support from the Scottish government but we need to find obviously effective ways of funding that and naturally, environmental issues are crucial, and when I talk about environments, not just the impact of the type of heating systems and the production of carbon impact and environment, it's our whole lifestyle and it's also about using the environment. So for instance, there's a lot of development up here and on our north face looking at wave power. There's a new Archimedes type generating water power, it's, yeah, whatever.

Alastair:
A screw thing yeah?

Craig:
Yeah, it draws water up to turn the turbine and it's drawn off the river Dawn at the moment and that's a local community initiative. So the community is making money from that as well as providing renewable energy. So there are all these initiatives going on in the Northeast including a carbon capture project that's been on the go for some time in Peterhead because Peterhead has, notwithstanding what I said earlier about the Scottish government generating almost 100% of its electricity from renewables. Peterhead still has the last gas-powered power station in Scotland. So, it's still producing carbon. If they think they can extend the life of that, they could draw the carbon off of that and basically store it, get rid of it. So it has to be, in my thinking, there has to be a lot of collaborative leadership because we don't have all the answers as landlords but equally, we don't want to be overly attracted by the shiny, shiny new technology that's coming along which distracts us from the basics of what does this mean for our tenants.

So we've got to be clear about what the challenge is so to that end, in Grampian, we are doing a desktop analysis which we will supplement with actual physical visits once lockdown is lifted on what are the gaps between EESSH 1 and EESSH 2. We anticipate that maybe two-thirds of our stock is currently not at EESSH 2 standard, that's 'B' rating. So, you know, that's two-thirds of the stock. Not all the stock will need significant investment to get up to 'B' rating but we are talking about, you know, more fabric first approach to improve the energy efficiency rather than trying to find costly solutions to actually reduce our carbon production from heating systems.

So fabric first is going to be the way and in terms of the sustainable development approach, there is a bit of hoping if we can provide the evidence to our tenants that they can become disruptors and themselves in the market to say, look, we want to use this product. We can see the benefits from it and the market will respond and if the market responds hopefully, the prices start to come down and it's more achievable.

Alastair:
You got it. You got it. Hey Craig, we're nearly out of time, unfortunately. But it's been great to get the perspective from Aberdeen. I think looking from the sidelines at the fact that you guys have had to get to 'C' already and 'B' by 2032, I think there are lots of lessons that we can learn from what you've done already there. You've mentioned that housing is just one part of it, housing in Scotland is just one part of it. There's a whole green jobs recovery that needs to sit behind economic recovery and us coming out of this pandemic that we've all sat through. And the potential skills shortage with that. So it's a huge opportunity but if we don't have the right people and the right skills to do it, we might lose that opportunity or it won't come to fruition in the way that it needs to. Cost reduction of the solutions - there's no silver bullet even though I gave you a leading question there. There are lots of different solutions now. Lots of different types of ways of getting there whether it's PV or air source, water source, heat pumps for the heating side. And until the total cost of these things comes down or is totally offset by funding, the numbers don't stack up either. So there's lots of work to do but, lots of great work that has happened already and lots of opportunity within it. So we're quite excited by it and it's another thing to ladle on to the responsibilities of housing providers on top of everything else at the moment. But, yeah, it looks like you guys are ready for the challenge.

Craig:
Yep, no pressure.

Alastair:
No pressure at all. Well, Craig, thank you so much for joining us! See you.

Craig:
Thank you, Alastair! It's been a pleasure.

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