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Group purchases

Stimulating energy-reducing investments for households by information and group purchasing

One of the core businesses of the sustainability team of IOK is stimulating energy-reducing behavior of the citizens of the municipalities in the Campine region. In 2008 the first group purchase was set up, with a purchase of solar panels and solar water heaters.

A group purchase brings together a group of interested inhabitants so that a larger market consultation can be done, a good quality control can happen and better (price) conditions may be stipulated at the installers. By a group purchase, the individual barrier to carry out energy-saving investments is reduced, allowing more effective investments.

Success formula for a group purchase

Information and sensitization are crucial

Experience shows that linking a group purchase to the provision of information is particularly effective. Exactly at the time of purchase there is a demand for expert info. IOK therefore links the purchase to the ’energy info tour‘. This latter action is a set of theoretical information sessions on reducing energy use and renewable energy production. The target group in these lectures are interested inhabitants mainly with an intention to invest in energy saving measures at home. The different themes are repeated throughout the region. So, every inhabitant can find an interesting lecture in the neighborhood. Combining the two actions enlarges the group of interested people.

The group purchase can insert specific expertise for technically complex matters, so an often limiting threshold for the citizen is removed in order to invest.

Strong involvement and central role of a steering committee, neutral supporting role of IOK and municipalities

The importance of the steering committee/working group, which consists entirely of future customers, should not be underestimated. They (and only they) make the decisions. They choose the most interesting offers. The final contracts are closed between consumer and installer. Neither the municipalities nor IOK are involved party in this matter. Therefore we don’t work with a public tender. IOK and municipalities provide input of expertise (from own home or via external specialists). The matter requires a very specific technical knowledge and experience. The role of municipalities and IOK is, next to the input of experience and expertise, in the first place administrative support (such as call for tender, collecting of interested inhabitants, organizing info sessions...)

Necessity of support from the sector organization(s)

Market disruption should be avoided by all means. However, experience shows that there is even a multiplier effect: the action provides an extra boost in the market. The action must in any case be supported by the sector. IOK works in close relations with the Construction Union, which are proved very productive.

Work with an optimal scale

Working with an optimal scale is crucial. It provides on the one hand an optimal scale and avoids on the other hand that the competition would be limited to just the big players. Working with regional clusters of 5 municipalities appears to work fine.

A great response as result

Combining sensitization and facilitating real investments works. This can be concluded when you look at the figures of the last group purchases:

 

 

Period

Number of participating municipalities

Number of investments

Solar panels and solar water heaters

2008-2009

19

483 (387 SP and 96 SWH)

Sanitize heating oil tanks

2010-2011

19

764

Roof insulation

2011-2012

25

700

Wall insulation

2012-2013

27

2200 inscriptions

High performance glazing

2013-2014

27

on-going

 

Script for a successful group purchase

–    Clustering of the municipalities to obtain an optimal scale of 5 municipalities into a cluster so that both large and small firms are able to carry out all jobs within the group purchase successfully;

–    Edit the tender in cooperation with the sector;

–    Call for tender through media, in order to not exclude contractors;

–    Per cluster a steering committee of interested buyers is formed. They assess the submitted tenders and choose the firm(s) that will perform the purchase together;

–    Integration with the ‘Energy info tour’ for comprehensive and complete information on the theme;

–    Tight schedule with 2 info moments per cluster (start session and session with the firms that are chosen). The purchase is finalized in 3 months’ time;

–    Tasks IOK: edit the tender, secretariat, content and give info sessions, moderate steering committee, answering questions in second line (back office), monitoring conditions tenders;

–    Tasks municipalities: commitment of all means of communication, answering questions in first line (front office), forward contact details of interested inhabitants, info sessions practical (room, projector, laptop, ...);

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