OUTRAGEOUS, SCANDALOUS AND SIMPLY CRIMINAL

Gerry McCaughey Founder of Century Homes (now Kingspan Century)

Battling against Government in a bid to find answers to the hottest topic on Earth, the Environment, is no easy task especially when one question leads to another and another and before you know it from what started out as a simple question about protecting our environment ends up a mire of tangled debade on building regulations. Maree Morrissey looks at the facts surrounding Ireland’s rising Co2 emissions and unravels a surprising sequence of events that leaves you wondering if you have been cheated by our government. Entrepreneur heavyweight, Gerry McCaughey, founder of Century Homes, now Kingspan Century after a recent €100 million sell out and Minister For Environment, Mr. Dick Roche T.D. are interviewed.

In February 1998 Mr Gerry McCaughey, wrote a letter to the then Minister for Environment Mr. Noel Dempsey about energy efficient housing in Ireland. The letter demonstrated ways which improvements could easily be made with little or no cost to the purchaser, but with massive benefits to the homeowner, the environment and consequently the country.

To support these claims, McCaughey included a report carried out by the British Department of Economic Development on an Energy Demonstration project based in Belfast which compared three types of timber frame construction methods with traditional brick/block buildings in regard to energy performance, capital cost, ease of construction and internal comfort conditions and demonstrated that it is technically feasible and financially viable to construct energy efficient new generation timber frame houses.

McCaughey claimed that if half the new homes built in Ireland (20,000) over the next ten years, which would be this time next year, were to be built to the minimum Century Homes specification there would be significant reductions in pollution emissions; 0.5 million tons annually. This would result in a reduction of approximately £30 million per annum on fuel costs for homeowners and a reduction in fuel imports into the country. Also it should be noted that the embodied energy cost of a timber frame house is much lower that that of masonry building, as significantly less energy is required to process timber than is required for concrete. This would also reduce emissions by several million tons, as less energy is required for processing. Timber is also a Carbon Sink (bank), in that it absorbs CO2 emissions from the atmosphere and stores them forever so with a little directed effort; Ireland could drastically reduce its C02 emissions.

In 1998 Ireland still permitted a method of construction that was banned in the UK and other North European countries – 9inch Hollow Block Construction. This method was being used in the greater Dublin area and still continues to be built today. McCaughey warned the Minister that, “in the UK this type of construction is deemed unfit for human habitation. Yet in Ireland it accounts for approximately one third of all houses constructed.”

Mc Caughey was concerned for new house purchasers who would not be able to purchase high quality energy efficient homes and claimed that the main beneficiary’s were the builders as this method of construction is a very cheap way to build. However in times of spiralling house costs, it would seem that this is the opportune time to insist on a more energy efficient method of construction from the building industry. Mc Caughey never received a response.

THE 1998 MEMO

Three months later, in an internal memo dated 22nd of May 1998 and marked, “Note For Minister of State’s Confidential Information Only,” a senior official in the Department of the Environment flagged the need to revise building regulations sooner (‘98/’99) than had been planned (‘02/’03) to compel home builders to construct more energy efficient homes to help cut carbon emissions. The official concluded: ‘However we don’t want to signal this to the outside world just yet because the next leap in building standard insulation will probably involve making it difficult for hollow block construction used widely in the Dublin area to survive.’ (see full memo in panel below).

THE ENERGY RESEARCH GROUP (ERG) REPORT

Two years later, in October 2000 a report was issued by the UCD Energy Research Group (ERG) commissioned by the Building Regulations Advisory Board (BRAB), a Government appointed agency assessing three construction methods, single hollow concrete block, twin leaf cavity wall and timber frame.

The report stated a revision in U-values for roofs and walls. A Uvalue is a method used to calculate energy efficiencies and is displayed in decimal numbers to mark the standard regulated U-value a typical house should be constructed to. For example the lower the number of U-values required in the regulations for the build of your home, the more energy efficient your home is. So by increasing the number of U-values for the build of your home, it is making your home less energy efficient.

To put this all in context, before 1997 the U-value for walls under the Building Regulations was 0.60. In 1997 it was lowered to 0.45 and in 2000 in the ERG report it was proposed to lower U-values for walls to 0.25 by 2005. In the same report this U-value was then raised to 0.27 in order to, “partly facilitate the buildability of certain constructions and partly to avoid going ahead of the UK where currently wall U-values are less ambitious.” The ERG gives this as reason for the revised Uvalue bearing in mind that this would make homes less energy efficient than the original proposed 0.25 U-value.

Outraged at the report, shortly after it was issued, MCaughey, under the Freedom of Information Act requested his files. Having read the report I became suspicious as to why energy standards were revised to, “facilitate certain constructions.” He found two internal correspondence at the (DOE) Department of Environment, one being the 1998 memo dated 22nd of May 1998 as mentioned above and the other, an internal email dated April 1998 where the department agreed with Mc Caughey’s original letter sent acknowledging that his estimations seem to be reasonable and that, “broadly speaking we should welcome innovative approaches to the reduction of CO2 emissions.”

The timing of these two memos, with a two month gap, shows that even though the Department were agreeing with Mc Caughey’s estimations they still went ahead and issued an internal memo to the Minister stating their concern for the survival of hollow block construction, despite the fact that Mc Caughey in his earlier letter showed that timber frame construction was a viable alternative. A reasonable observation to this would show that the department quite clearly showed favouritism to one particular method of construction.

Today, Mc Caughey reacts to the ERG report saying, “what relevance is avoiding going ahead of the UK to Ireland as an independent nation and furthermore as Britain is going to meet its Kyoto commitments, they are not under the same pressure Ireland is.”

Mc Caughey claims that both twin leaf cavity wall construction and timber frame construction could have withstood the original proposed Uvalue of 0.25 however hollow block could not have. “As concrete cavity wall construction and timber framer could meet basically any increase in insulation standards, this is an example of Irish building Regulations being compromised to protect the interests of the concrete hollow block sector.” So why reduce energy efficiencies to favour the lowest common denominator, hollow block?

UNRAVELLING SMOKESCREENS

I asked Minster for Environment Dick Roche T.D. what certain constructions was he referring to and if it was infact hollow block. However despite my many attempts to get a straight answer the Minister refused to answer the question and instead offered me this smokescreen. “Mr Mc Caughey seems to consider that the Department sided with the hollow block industry in order to thwart the progress of timber frame. This is untrue. In the late 1990’s the Department of the Environment and Local Government commenced the process of upgrading building energy rating standards. The Department had to consider all aspects of the proposed stricter standards, including impacts on the construction industry at a time when demand for houses was putting severe pressure on house prices.

The broadly based Building Regulations Advisory Body (BRAB) therefore commissioned an assessment of the impact of higher thermal performance standards on house building. This independent study was carried out by UCD/ERG, which showed that all of the most common house building systems could be insulated to comply with the proposed higher standards, including hollow block construction.

“This report stated in black and white the exact opposite. It said that the standards were to be revised to, “facilitate the buildability of certain constructions,” explains Mc Caughey, who goes on to say, “the Department of Environment delayed the implementation of increased energy performance regulations from 1998, when they first knew about the implications, to 2003, which he says gives the construction industry the freedom to continue to build without regard for the impact their sector is having on the environment. This was done to favour hollow block construction at the expense of consumers and our environment.”

As recently as six months ago, in September 2006 the Department of Marine and Natural Resources launched a major national awareness campaign, ‘The Power of One,’ on the basis that Energy efficiency and energy saving is the quickest, most effective and economic means of reducing energy usage and emissions with one single overriding objective, to achieve real and measurable change in consumer awareness and behaviour on energy efficiency. The campaign reflects a key imperative for Irish and EU energy policy however it is interesting to note that the transport sector is highlighted as a, ‘targeted individual sector,’ whilst there is no specific mention of the construction industry, which produces the highest amount of CO2 emissions other than telling people to turn down the temperature in their homes by 10 degrees.

SEEKING CLARIFICATION

In a further effort to get clarification on what certain constructions the report was referring to, which could only have been one of the three, twin cavity, timber frame or hollow block, the Minister’s spokesperson Mr Feargal Quigley refused to answer my question on the basis that my question was already answered and instead suggested that I don’t waste my time getting into specifics that happened many years ago as they were dealt with back then and it was a pointless effort on my behalf for the sake of a 2000 word article. As far as he was concerned I was wasting my time as readers of Irish Entrepreneur would not be interested in details of who said what, when and where.

I asked for a specific answer to my question about why timber frame construction was not mentioned in the 1998 memo as an alternative to hollow block given that it was made known to the department three months prior to the memo that timber frame could compete with hollow block on feasibility and speed of build thus having no impact on the housing crisis and would also have the added advantage of reducing CO2 emissions. Mr Quigley explained that the simple answer to the question was that the Government will not discriminate against any one industry sector and did not protect the survival of hollow block.

In the same context Mr Quigley accused me of wanting to shut down the hollow block industry.

Mr Quigley added that the memo’s content is based on specific concerns about energy efficiencies for concrete construction only and timber frame construction is referred to positively in other parts of the whole document which the memo forms part of. I asked if it was possible for me to get hold of the full document however Mr Quigley was quick to point out that it would mean him having to employ a civil servant to dig out the relevant documents, which was more or less an impossible task and for me, a four week waiting time and high costs attached to attaining the documents. Mr Quigley again suggested that I was wasting my time as this type of detail would bore the readers of Irish Entrepreneur however if I wanted the document I could go ahead and apply under the Freedom Of Information Act.

This revision did not become policy until 2003, five years later from when the memo above illustrates that the Department was aware of the need to revise building regulations sooner for the purpose of energy efficiencies due to the CO2 emission targets set by Kyoto Convention in November 1997 however, “did not want to signal this to the outside world just yet because the next leap in building standard insulation will probably involve making it difficult for hollow block construction used widely in the Dublin area to survive.”

What this means in short is that if your home was built between 1997 and 2003 it would have been built to the 1997 Building Regulations U-value of 0.45 which was 35% less energy efficient than the 2003 Building Regulations revised U-value of 0.27 which is a calculation made by the Department of Environment in a press release issued to the media in November 2000 further to the ERG report. Bear in mind that this U-value was originally proposed to be 0.25 which would have meant a further energy saving.

THE REAL IMPACT

Mc Caughey says that 250,000 houses were built in this period and that eventually all of us home owners could suffer when it comes to selling or renting our properties. After 2009 it will be compulsory that all homes will have to produce an Energy Ratings Cerificate. The new Building Energy Rating (BER) certificate is an energy label that demonstrates the energy efficiency of your home and according to Mc Caughey it is the desire of the EU that the cert be used in the negotiating of the sale of your home just as you would evaluate the purchase of an electrical appliance on its energy efficiencies. On the laws of average, common sense tells you that consumers will try to buy the more energy efficient product over a less energy efficient product in order to save money on the running costs. In the case of housing this would mean that homes with a bad energy ratings could suffer in value as a result of house buyers decision to buy the more energy efficient home.

A NEW SPIN

Senator Joe O’Toole puts a whole new spin on the debate, where he said recently at a Senate debate on this very topic that it is possible that in the future we may see Irish citizens taking legal action against the Government on the loss of energy savings on their homes and the subsequent effect on the resale of their properties as a direct impact of the delay of the Government to act sooner on changing the standards of energy efficiencies in Building Regulations, despite the fact that they knew the potential outcomes for home owners if it can be shown that there was negligence on the part of the Government. In a conversation with the Senator, he explained to me that this whole issue is complex, however not hard to understand, but the difficulty in raising hype or interest on the topic is that, “anything you can’t explain in two minutes dies.”

The Senator goes on to say, “the proof is in the fact that builders themselves are demanding a higher level of insulation and when you see that the national standards were not raised to meet their demands, you know that something is wrong. For example look at the much raised energy efficiency standards introduced by Fingal County Council and you’ll see how higher standards could easily have been implemented.

All the reasons given by Government for reducing the standards for energy efficiencies back in 2003 don’t make sense and it really irritates me when small things are not dealt with. Now look at the mess we are in?”

LOCAL AUTHORITIES SHOW UP NATIONAL STANDARDS

Fingal Local authorities implemented in the local area plans higher energy standards, requiring that all houses in the Fingal local area plans must be built to a standard 60% better than the current building Regulations. Wicklow, Wexford and Dun Laoghaire are following suit, which begs the question, are we now in the ridiculous situation where in Ireland local government is taking the lead over national Government on the Kyoto Protocol, similar to that of the United States where individual states are taking lead over Federal Government in adopting Kyoto Protocol.

If that level of energy efficient housing can be built in Fingal why can’t it be built everywhere in Ireland?

Minister Roche says, “this project will help inform the revised higher standards which we will be putting in place nationally. The Government however had a duty to ensure that national standards are both demanding and reasonable.”

When introducing new standards, which affect any sector of the economy the Government has a duty to listen to the concerns of everyone affected. Senator Joe O’Toole argues that, “builders don’t care what standards are set, they find ways of achieving this and just factor it into their prices. It is up to politicians to set the standards and industry to respond. The whole issue is a complete disgrace.” Minister Roche goes on to say that the Department has continued to up the energy rating standards in this country on three separate occasions since 1997 alone. “Research shows that only one increase in energy rating standards to date, which was in the revised building regulations of 2003. These standards remain the same today.”

The Minister concluded, “I am commencing a new review this year to improve standards even further. This will be part of Ireland’s commitment to meet our Kyoto obligations.” However, given that CO2 emissions from the residential sector increased by 7.5% (550 million tonnes) between 2003 and 2004, is this not a little too late considering the Kyoto measurement period begins in 2008 and runs to 2012 and in light of the EU’s commitment to a further 20% reduction on CO2 emissions by 2020?

The next revision of Building regulations is due in 2008 and it will be interesting to see what amendments will be made to further increase energy efficiencies in housing construction in an effort to further reduce CO2 emissions as the pressure mounts on Government to meet our obligations to Kyoto. An Environmental Protection Agency (EPA) source revealed that the next EPA Report due out on the 16th of February will demonstrate clearly that C02 emissions are rising and that the CO2 emissions from the residential sector is increasing at an alarming rate. Therefore it will be apparent that the only way to tackle the issue of substantially reducing CO2 emissions will be to impose stricter regulations on the methods of constructions used. Having said that, a reasonable assumption shows it will be difficult for hollow block to survive as previously predicted by Government in the memo of 1998, which shows that hollow block would have inevitability become redundant. However many questions remain unanswered. Why then is hollow block still in use today and why were building regulations revised in the ERG report to suit the, “buildability of certain constructions?” Were these constructions Hollow Block?

HAVE YOU BEEN CHEATED?

Going on the assumption that both Mc Caughey’s and the concrete industries claims are true, that both twin leaf cavity block and timber frame construction could meet basically any increase in insulation standards, on the process of illumination it would seem that certain constructions referred to in the ERG report could only be hollow block.

As such why revise standards to lower energy efficiencies to protect the survival of one sector, the least energy efficient of the three. This is blatant favouritism for one sector and discriminates against others. Even in the Government’s best efforts not to be seen to favour one industry sector over another, any reasonable person could argue based on the facts, that this wasn’t the case. Given our commitments under Kyoto this further adds weight to the argument for the Government’s need to raise energy efficiencies in priority to protecting the survival of a particular sector.

Even if Kyoto permits the purchase of carbon credits to be used in instances such as this, whereby the industry must meet standards and if it fails to, must purchase credits to account for its shortfall, is the point not that if the Government had paid heath back in 1998 to ways of significantly reducing CO2 emissions, acted on this in a faster time frame than five years, we would have seen a drastic reduction in CO2 emissions and there would be less need if any, for carbon credits to be utilised in this sector. This is an embarrassing dilemma for the Department of Environment and despite their best efforts to keep the wolves from the door, I’m afraid I don’t think this issue can be swept under the carpet for much longer.