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Arbed - Strategic energy performance investment programme

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A household is in fuel poverty if they spend 10% or more of their income on energy costs.
Climate change is the way the world's climate is changing as a result of the level of gases in the atmosphere.

This programme supports our commitments to reduce climate change, help eradicate fuel poverty and boost economic development and regeneration in Wales.

The programme was established in 2009 to bring environmental, social and economic benefits to Wales and coordinate investment into the energy performance of Welsh homes.

Phase 1

Phase 1 of the Arbed project was the largest programme of its type in the UK. We have invested £36.6m into the first phase of Arbed and worked with social housing providers to make communities in deprived areas of Wales more energy efficient. This was done by retro-fitting homes with measures including solid wall insulation, solar panels and heat pumps.

The Arbed phase 1 portfolio of 28 schemes leveraged an additional £32m. This equates to total investment of over £68m.

Of this, at least £20m was invested by social housing providers and local authorities who took advantage of cost savings and economies of scale offered by Arbed schemes to realign or bring forward their budgets for maintenance, housing renewal, neighbourhood support. This investment has enabled homes to receive multiple energy efficiency measures including:

  • boiler upgrades and replacements
  • window upgrades
  • roof extensions
  • structural work
  • energy saving advice.

A further £10m of the additional investment was from energy companies through their Carbon Emissions Reduction Target (CERT) and Community Energy Savings Programme (CESP).

Arbed phase 1 funded measures to over 7500 households in Wales:

  • Solid wall insulation has been applied to over 4000 social and private homes, the average cost of which was below market rate due to the economies of scale gained from area based schemes and leveraged funding
  • Over 1800 solar Photo-Voltaic (PV) panels have been installed in social housing and many of the partner social landlords are now planning to fund further installations and access the Feed-in Tariffs
  • Solar heated hot water has been provided to 1080 homes including several sheltered housing schemes
  • Arbed has enabled nearly 1000 properties to access cheaper and lower carbon fuels, this was achieved through contributions towards the cost of switching from coal or electric heating to high efficiency gas boilers
  • Heat pumps were installed to over 100 households off the gas network.  

Arbed phase 1supported the development of local supply chains in low energy technologies and energy efficient measures.

  • 41 out of 51 installers that delivered Arbed measures operate primarily, or solely, in Wales - a number of the remaining companies had large employment bases in Wales
  • 8 installers gained accreditation to install renewables as part of the Arbed programme
  • Five of the 17 products used, which were eligible for Arbed support, were manufactured in Wales.

Phase 2

The second phase of the Arbed programme started in May 2012 and is partly funded by the European Regional Development Fund (ERDF).

The total budget available for the Arbed phase 2 ERDF project, for both Convergence and Competitiveness Areas in Wales, will be up to £45million. This comprises £33million ERDF money and £12million match funded from us.

The overall investment objectives of the Arbed phase 2 ERDF project are to:

  • improve the energy efficiency of a minimum of 4800 existing homes in Wales by the end of 2015 
  • reduce a minimum of 2.54 KTC (Kilo tons of carbon) of greenhouse gas emissions by the end of 2015.

The Arbed programme will continue to boost local economies by using local businesses to manufacture, supply and install as many of the measures as possible and provide training and employment opportunities for local workers.

The Arbed programme will also contribute to eradicating of fuel poverty, cutting greenhouse gas emissions and to improving the energy performance of homes in Wales.

Over the next three years, the Arbed phase 2 ERDF programme aims to deliver between 10 and 20 schemes throughout Wales in each year of the project – with approximately 50 schemes to be delivered in total.

The second phase of the Arbed programme is being delivered by 2 OJEU (Official Journal of the European Union) procured scheme managers. Willmott Dixon will be delivering the schemes in north and mid Wales and Melin Homes will be delivering schemes in south Wales.

Other projects

In addition to phase 2, there are a number of other funding opportunities that have been identified. 

In June 2012, we provided £2million to take advantage of the closing stages of CESP (Community Energy Saving Programme) and to maximise the energy companies’ investment into Welsh homes. CESP ended in December 2012. It has been replaced by ECO (Energy Company Obligation).  

Using this money, we were able to give grants to local authorities to support projects to fit energy efficiency measures to properties. Through this funding, we expect that an additional £5million will be leveraged in from energy companies, local authorities and housing associations. This will support over 1000 homes in Wales, to receive energy efficiency measures including external wall insulation and heating upgrades.

In January 2013, we provided £2.15million to the Arbed Programme to help with the change from CESP to ECO. This was aimed at helping the installers who have seen a significant reduction in work since the end of CESP. Local authorities have been invited to apply for grants to support projects attracting ECO funding. We expect that this funding will provide support for 804 properties in Wales and leverage in another £2.

In February 2013, we provided a further £2.3million to the Arbed programme. This money will provide grants to create a network of Green Deal Demonstration Homes/Schemes in Wales. These demonstration homes will be used to provide examples of the energy efficiency improvements that can be made to homes under schemes such as Green Deal, Nest, Arbed and ECO. The grants are targeted towards Registered Social Landlords.

The future

Over the next decade, investment into the sector in Wales will also come from:

  • Nest – our demand led fuel poverty scheme
  • the Welsh Housing Quality Standard
  • Feed In Tariffs
  • Renewable Heat Incentive
  • Green Deal 
  • Energy Act – giving landlords the responsibility of improving the energy efficiency of the private rented sector by 2018 
  • energy supplier obligations.

Around £1bn over the next decade is likely to be invested into the energy performance of Welsh homes. The sector is highly labour intensive, creating skilled local jobs for local people.

Our partners

The Arbed partners include:

  • the Welsh Local Government Association (WLGA)
  • Community Housing Cymru (CHC)
  • the Energy Saving Trust (EST) 
  • the Building Research Establishment (BRE).

Contact us

If you have any queries about the Arbed programme, please contact us by email at