Key orders inquiry into heating scheme prices

BY TOM FITZSIMONS
Last updated 05:00 11/08/2009

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Energy officials have been asked to look at whether heating and insulation companies are hiking prices to take advantage of a Government scheme.

Prime Minister John Key said yesterday he would be concerned if the subsidy had the effect of leading to higher prices and not the anticipated benefit to consumers. "I've certainly said to my officials I think it's something we should have a look at."

The call comes after reports of companies raising prices in the $323 million Warm Up New Zealand scheme.

One Lower Hutt man found that a Government-approved provider charged $700 more than a company that had not signed up to the scheme.

Approved companies say they offer a superior service and face compliance costs because of the scheme. They are warning that many people will not have insulation and heating installed by next winter because the demand is so great, and the first year's subsidies will run out.

The Energy Efficiency and Conservation Authority's residential manager, Robert Linterman, said some consumers had complained about excessively high quotes from Government-approved providers, but had usually not been comparing the same products.

Approved providers were on a contract until the end of September. Applicants for approved status after that had been asked to submit prices.

The scheme allows people to claim $1300 in insulation subsidies and $500 for a heating appliance. Community Service Card holders can get more funding.

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- © Fairfax NZ News

38 comments
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Steve   #38   09:37 am Aug 12 2009

Typical Communist New Zealand. We are the same(but in a different industry) - a New Zealand Small company competing against New Zealand government owned or heavily subsidised larger companies where we supply exactly the same products. This government wants to make New Zealand richer? Stop interfering and keep it simple.

Efficiency   #37   01:10 am Aug 12 2009

How about we scrap it all together to see how many houses get insulated! Or we can extend the Police duties to arrest installers who charge too much! Is this a case of a reaction being bigger than it needs to be? If their are a few quotes which don't match could there be a reason for it? When you buy a prescription medicine which is subsidised do you shop around? Should we? When we go to pay school fees should we say "excuse me but I thought this was supposed to be free education" EECA should investigate pricing and have ceilings but if the manufacturers are not giving the same prices then how can we expect everybody to charge the same? I'm sure a bigger company should be able to get a better price than a smaller company.

Phrases work   #36   10:22 pm Aug 11 2009

Like "Get the quotes and compare!" Also realise that with any Government scheme the paperwork and compliance requirements should keep things "more expensive for the end user". It's just a case of "what's cost of comfort?" The cost for batts online is around $13 per m2 for good ceiling batts and underfloor around $9-$15. If you can put them in great but if the price your getting is close to what you can buy and the installers are from a company in your area and can do all that you want. If they "outsource and you will pay more!" as the more people get involved the more people there are "clipping the ticket" Find a "one stop shop" through EECA and "if they can't good luck" as you will need to do the "wheeling and dealing" on your own... which may not all that bad until you run into the phrase "you get what you pay for"

ripped   #35   09:48 pm Aug 11 2009

We were quoted $4300 less the subsidy. As it was too much for us to spend at the time, we then worked out the material costs (actually using insulation with greater 'R'value) and this came to $1130. That would have worked out at $528 per hour to install!

Fred   #34   08:34 pm Aug 11 2009

People. I laugh at the ones saying they installed it themselves. Insultion is no longer easy to instqll, it takes a professional to do a decent job. No Gaps, No creases, no Folds at ALL. Decnt dlearence to chimnes and flues, and cut out around downlights. Most people just dont do it justice, and the so called cheaper job isin't worth anything at all if it leaks heat. Take a leaf out of the prefessionals book ppl, download a copy of the NZ Standard 4246 and see if you can do it yourselves. Bet you cant do it so quickly or as effectively then. Good on the government for setting high standards.

Chad   #33   08:16 pm Aug 11 2009

The EECA is a joke. We got ceiling insulation and underfloor insulation put in by the EECA under the Labour Governments scheme for insulation. The underfloor insulation consisted of 'Foil' stapled to the underside of the floor boards.

The guy who turned up to inspect the work said, were here to inspect the insulation. He never came inside, but gave us two energy saving light bulbs, then left.

Later on we found out that this type of insulation is not adequate for underfloor insulation and the EECA's website says it does not approve of this type of insulation for underfloor insulation, even though they installed it for our house.

I talked to the EECA to see if they would re-do the insulation because in the winter the house is still very cold and the floor is freezing.

The EECA representative, just chuckled and laughed and said, Aaaah yes, that insulation is not very good, but we frown on people who ask for underfloor insulation a second time and refused to remedy the problem. Well that's just typical of a government department and in my opinion the EECA is useless and a huge joke.

What makes it worse is that we are not eligable for underfloor insulation under the new scheme, because we were already given a grant for underfloor insulation under the old scheme. But the problem is the underfloor insulation installed by the EECA useless and not adequate.

Oh well, I guess they have to save money somewhere, to pay for all those Government perks and expenses.

ray clarke   #32   04:44 pm Aug 11 2009

Why is it that some New Zealand organisations simply cannot help themselves enough to the pot of gold. The Government has made the correct decision to Insulate but those approved by EECA are to blame as well as EECa who have not the expertise to evaluate reasonable levels of charges. No wonder there was such a low uptake on the old scheme. The stupidity is that in order to get the Govt subsidy you MUST use an EECA approved Contractor no one else will do. This the old Socialist adage of we always know best at Civil Servant level and the rest of you do not. Gerry Brownlee was warned this would happen!

milton   #31   04:38 pm Aug 11 2009

Like most Government initiatives and things that the government runs, it usually :-

1. Takes longer than needed. 2. Costs more than it should. 3. Adds layers of unnecessary buracracy and paper work. 4. Does not deliver value for money.

I guess it's not just MP's who know how to Rort the tax payer. These companies could use Roger Douglas line 'I am doing nothing wrong. I'm entitled to it'. That is charge the prices that they charge. It's not illegal what there doing, but it is also not ethical.

ubernoob   #30   03:19 pm Aug 11 2009

Everything on here ive read seems to be posted by people with no or little knowledge of the scheme itself or how it works, and even less knowledge of how to properly insulate a house. "DUH" Buying a few packs of 'batts" and sticking them up in the roof between the ceiling joists isn't a good or proper way to insulate. Im sure there are a few people who will always break the rules and try and gain more than they should and they should and probably will be culled out. But the public also need to do some research,to educate themselves on the different types, life spans, and insulating properties of insulation shooting their uneducated gobs off.

Carol   #29   01:24 pm Aug 11 2009

This always happens when governments offer subsidies or allowances supposedly directed at a particular cause or demographic. What we need to do is cut taxes, give us our own money back, and we'll spend it as we see fit. That would be a whole lot more efficient than creating a bureaucracy to administer a subsidy for insulation - which I note that those of us with any brains have already made a priority and done a long time ago. How many of these people lining up for this subsidy have already got 40 inch TVs and such ?? Can I have my subsidy to spend on a TV please ? Or better yet Mr Key - instead of a subsidy why don't you offer a tax rebate for EVERYONE who has an insulated house ??


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