A new twist on an old flame

British Gas is a household name with a rich history but while most people would associate the company with energy supply the modern day organisation offers a wider range of services than you might think

Sam Laidlaw chief executive of Centrica – the parent company of British Gas – said recently that the old utility business model is dead and that within a few years British Gas’s energy services business will become at least as big as its energy supply business.

Increasingly British Gas will no longer be an energy supplier that provides energy services but more an energy services company that happens to also supply some energy.

Already the company offers a whole range of microgen and renewable technologies including solar PV, solar thermal, biomass and ground and air source heat pumps.

And far from jumping on the green band wagon British Gas has been working in renewables for quite some time and has experience of installing PV panels for over 15 years.

“We have got a track record, we have got an understanding and being British Gas we bring a quality and a reputation that precedes us in doing these installations,” says Farooq Mohammed, business development director at British Gas Community Energy.

Over the past five years the company has been working with its customers to improve their energy efficiency and on average seen a 22 per cent reduction in gas consumption and in some cases a reduction of up to 42 per cent – not what you would expect from a company traditionally associated with energy supply.

“We’re not driven by making people spend more on their energy bills, in fact we’re doing the opposite,” says Mohammed. “Given continuing rises in energy prices and volatility of wholesale costs, it’s highly unlikely prices are going to come down anytime soon if at all. If anything they are going to continue to rise and we can’t continue on a business model that is predicated on selling more and more energy. That is why we’re following a different model of energy services and we are well down that path in delivering a revised model.”

The Community Energy arm of British Gas works with the social housing sector to improve energy efficiency, reduce carbon emissions and tackle fuel poverty. “We are effectively coming up with energy solutions and providing energy services ranging from your basic cavity wall and loft insulation to your more sophisticated microgen and renewable technologies, such as PV, solar thermal, biomass and everything in between to help landlords to achieve those aims,” says Mohammed.

The company is able to offer advice on its full range of measures and technologies to help landlords choose the best option for their organisation.

“Able to supply all, we are microgen and renewable technology neutral,” says Mohammed. “So when we talk to social landlords and clients about microgen and renewables options we can genuinely understand a client’s needs and offer the best solution rather than being able to offer a limited one or two options” The company’s energy experts always survey properties first to ensure that they are suitable for the installation of microgeneration or renewables, if a property is not energy efficient to start with it may mean the technologies don’t deliver the intended benefits.

“My mantra has always been fabric first, dealing with the basics, looking at the envelope of the property,” says Mohammed. “There is little value in going high tech i.e. microgen and renewables if the basics have not been done first such as cavity wall and loft insulation.”

For those properties that do require work to bring them up to the ‘fabric first’ standard British Gas can offer cavity and solid wall insulation – both internal and external – as well as loft insulation.

While BG offer the full range of microgen and renewable technologies, solar PV is in Mohammed’s words “the one that everyone is interested in” and last year British Gas was one of the U K’s largest PV installers.

Solutions can be tailored for organisations depending on their needs and indeed their budgets and can include advising clients on funding packages such as the Carbon Emissions Reduction Target (CERT) and the Community Energy Saving Programme (CESP ), supplying solar panels, installing them and in some cases maintaining them.

“If you have got different stakeholders you might have a housing association, local authority and a private landlord all owning properties within the area. If we can get them all together we can offer more funding and potentially can offer up to 100 per cent funding so it might not cost organisations anything,” says Mohammed.

British Gas can also help social landlords to take advantage of the Feed in Tariff, as Mohammed explains: “If the client has got budget to install PV systems because they want the FiT then we come along and do the installation and they collect the FiT but equally if they aren’t in a position to make the investment they can look at our rent-a-roof proposition so we would pay for the capital cost upfront, they would enjoy the installation and roof rental, the tenants would enjoy free electricity and we would collect the FiT to recover costs.

The Green Deal and the introduction of the Renewable Heat Incentive will create further opportunities for British Gas to work with social landlords.

“The Green Deal is right around the corner and is a fantastic opportunity,” says Mohammed. “We are working with a number of large local authorities who have already started the procurement side to appoint Green Deal partners. W e see ourselves playing a big part in the Green Deal going forward and being a Green Deal partner installing these measures up and down the country.”

For example, BG is already working on national fuel poverty multi-measure programmes in Scotland and Wales, and recently was appointed as Green Deal Trailblazer working with the Association of Greater Manchester Authorities – comprising 10 local authorities.

With domestic properties accounting for a third of all carbon emissions in the country the low-carbon agenda is huge but physical changes to properties are not enough, the behaviour of householders has to change too.

“I am a great believer in helping to change behaviour in energy use. Installing energy efficiency measures is a great start but this needs to be delivered with behavioural change from the residents, without which you are not going to reap the full benefits,” says M ohammed.

British Gas employs resident liaison officers to visit properties after microgen installations have been completed to make sure that residents are comfortable with the system, know how it works and understand how to maximise the benefits. It also supplies home displays which allow people to monitor their energy usage.

While steps are being taken to change attitudes Mohammed believes that there is still a long way to go and social landlords have an important role to play.

“I think people are a little bit wary because it is still a relatively new phenomenon and people don’t know enough about it, residents don’t always understand it,” he says. “So I think there is still quite a bit of work to be done to help people understand what is out there and whether it is something for them.

“I think in terms of helping with that, social landlords be they local authorities or housing associations are what I consider to be trusted stakeholders so I think they have got a part to play with us. It is challenging for British Gas or another commercial company to come along and try to communicate that directly, I think we need to work in partnership.

“In our experience what we have found works really well is involving the community in more of a grass roots approach and we are doing quite a lot of work with communities up and down the country.”

In fact British Gas made £2 million available to invest in innovative community energy projects as part of its Green Streets programme.

A total of 14 community-based projects were chosen to go head-to-head for the title of ‘Britain’s most innovative green community’ competing to see who could do the most to save energy, generate energy and engage people locally. The community that came out on top received up to a £100,000 prize to spend on a local environmental project of their choice.

“We are working with communities to introduce them to microgen and renewable technologies and to support behavioural change,” says Mohammed.

“We have not led them, all we have done is support them with technical help in design and planning but we have let them tell us what they want to do.

“Surrounding communities have become interested and it has had a ripple effect, stimulating greater awareness and understanding and normalising the technology.”

Community engagement is key to the green agenda says Mohammed and British Gas has five energy solutions teams that work directly with communities in Scotland, England and Wales to bring a local presence to the company. “I don’t think a top down approach is as effective” says Mohammed. “It has to be bottom up working in partnership.”

The company’s green agenda stretches beyond houses with British Gas teaming up with Nissan and Renault to install PV charge points for electric vehicles.

It is also doing its bit to ensure a strong green skills base for the future and in May 2010 set up the UK’s first dedicated green skills academy in Tredegar in Wales. As well as upskilling British Gas staff in renewable technologies the academy has trained up new apprentices and is open to SMEs. It aims to become a community hub for increased economic activity and green living.

Mohammed says: “We want to be a thought leader in this, we want to help lead the transition to low carbon and that is my driver”.

Microgen, electric cars and green academies are all a far cry from British Gas’s early days as an energy supply company and bring a new twist to a household name – a name that is sure to become synonymous with the green agenda.