OFT Pushes for Greater Competition in Home Insulation Market

Jack Humphrey, Regulatory journalist
August 02, 2012 /

The Office of Fair Trading has stepped up efforts to improve consumer protection and encourage more competition and choice in the home insulation market.

The OFT issued a call for evidence in April, triggered by the high level of consumer complaints about home insulation, and concerns that competition in the market may not be working well.

It wanted to carry out a quick review ahead of the introduction of the Government’s Green Deal and Energy Company Obligation (ECO) policies, which could increase the take-up of energy efficiency measures.

During its evidence gathering, the OFT received complaints that some traders are not always installing the most suitable form of insulation, for example, by using inappropriate materials in houses that are susceptible to damp.

It also found that people can find it difficult to obtain quick and effective redress when things go wrong.

In response to these findings, the OFT has recommended that the Government should ensure a single body has clear responsibility for longer-term monitoring of the quality of installations carried out under the ECO and Green Deal initiatives, and has also proposed changes to improve redress schemes.

The OFT also found there are only a very small number of manufacturers supplying home insulation products, and received complaints about the length of time it can take for new products to be approved for use in the market.

To lower the barriers for manufacturers trying to develop innovative new products and encourage greater competition and choice in the market, the OFT has recommended that product certification bodies improve their certification processes.

It is also encouraging architects, building control officers and other building project commissioners to be more open to specifying products from more than one UK product certification body.

As part of a wider energy efficiency project looking at products like double glazing, solar panels and boilers as well as insulation, the OFT has also reviewed almost 4,000 contacts made by consumers to Consumer Direct in 2011 and 2012.

This has highlighted a number of recurring issues including the possible use of confusing and defective paperwork, potentially aggressive and misleading sales techniques and concerns over the quality of products and services.

The OFT continues to actively examine issues that may be causing consumer detriment in this sector and will look to address these, including through potential enforcement action where appropriate, working with local authority Trading Standards Services and others.

OFT Director of Services, Infrastructure and Public Markets, Nisha Arora, said: “The home insulation sector is now worth some £700 million and it is important that people receive good quality, well-installed insulation that makes their homes more energy efficient.

“We hope that the recommendations in this report and our continuing work in this sector will encourage greater competition and choice and give consumers increased confidence to have insulation installed.”

The OFT has been working with the Department of Energy and Climate Change (DECC) to ensure energy efficiency markets can work as effectively as possible when the Green Deal policy is implemented.

 

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