Government urged to ‘get serious about the cost of living crisis’ by committing £23bn to a ‘retrofit revolution’
- Building Back Britain Commission finds energy efficiency measures are financially unviable for 2.3million households in England
- Cost of going green is too much of a barrier for those in homes under ‘critical price threshold’ of £162,000
- Report sets out ambitious plan to decarbonise millions of problem homes over the next decade
Some of the leading figures in UK housing have called on the Government to commit to spending £2.3billion a year for the next decade on raising the energy efficiency standards of 2.3million homes across England.
According to the Building Back Britain Commission, the radical action would help to reduce the energy bills for some of the poorest households and kickstart a “retrofit revolution”.
The Commission is an independent group consisting of some of the highest profile organisations in the housing sector including the chief executives of Barratt Developments, Legal & General, Mace, Thakeham, NHBC and Riverside Group. It has produced a new report which reveals for the first time the enormous challenge of decarbonising the UK’s ageing housing stock.
Key findings include:
- In the average English local authority, 58% of homes are below an EPC rating C and the cost of getting all homes up to this standard is likely to be at least £200billion
- For homes under the ‘critical price threshold’ of £162,000, making any energy efficiency improvements to the property – such as installing solar panels, heat pumps or cavity wall insulation – would be financially unviable due to the cost of the work exceeding the potential house price gain
- The problem is particularly acute in ‘levelling up’ areas with more than one third of homes in these local authorities priced below £162,000 compared to less than one in ten in non-levelling up areas
The research, which was carried out by two former Government economists, identifies 2.3million homes across England which are valued under £162,000, have an EPC rating below C and are located in ‘levelling up’ areas.
The five local authority areas in levelling up areas with the highest percentage of homes that fall into this criteria:
- Blackpool – 69.8% (49,235 homes)
- Burnley -68.8% of homes (28,359 homes)
- Hyndburn – 67.3% (24,959 homes )
- Pendle -63.9% (25,938 homes)
- Hull -60.9% (74,434 homes)
Notably, for the top ten local authority areas that fall into this criteria, half are in marginal ‘Red Wall’ Seats.
The Commission urges the Government to put funding from the existing £9.2billion for energy efficiency measures set out in the Conservative Party’s 2019 election manifesto towards the retrofit of these homes over the next decade. Doing so would create long term certainty that would kick start the development of a Great British supply chain in retrofit and energy efficiency technology and services.
With around one in five of the homes that will exist in 2050 yet to be built, the new build sector remains crucial to the UK achieving a zero-carbon economy. Therefore, the report also calls on the Government to do everything possible to support developers as they identify and implement solutions to achieve the transition to net zero by 2030. In particular, the paper says the Treasury should look use R&D tax credits to incentivise a greater take up of modern methods of construction technologies while the Government should work with lenders to improve the availability and take-up of green mortgages. The report also recommends that Homes England work with local authorities to identify and replace those older homes which are beyond realistic repair to help reach net zero.
Terrie Alafat CBE, Chair, The Riverside Group and Chair of the Building Back Britain Commission, said:
“Government needs to get serious about tackling the cost of living crisis with radical action to improve the energy efficiency of millions of our homes. That’s why the Building Back Britain Commission is calling on Government to commit to funding a retrofit revolution, alongside further action to ensure the highest possible standards in our future homes. Without this, Government will always be fighting a losing battle on both net zero and energy bills. But by working with industry and following the steps that we suggest, it could yet have a win-win.
“In the long-term, taking decisive action now to make our homes more energy efficient will enable the UK to make much-needed strides forwards on the path towards net zero. In the short-term, it will also mean lower fuel bills for millions of people who are suffering as a result of the energy crisis and urgently need help with the cost of living.”
Robert Boughton, CEO, Thakeham Group, said:
“Meeting the net zero challenge demands ambitious thinking from both industry and Government. Our report makes clear that greater partnerships with Government will be critical in advancing not just net zero homes, but also net zero placemaking to encourage more sustainable lifestyles.”
Jason Millett, CEO for Consultancy, Mace, said:
“Our report reveals the full scale of the challenge around housing and net zero, along with ambitious yet realistic steps for achieving net zero emissions in the UK by 2050. The retrofit imperative is clear, and it is essential that the Government commits funding to create greener, safer homes. In addition, action should be taken to encourage greater uptake of modern methods of construction that will allow the housebuilding industry to be more self-sustaining in net zero efforts.”
David Thomas, CEO, Barratt Developments, said:
“Many developers have made significant steps forward on decarbonisation, with new homes achieving high standards of energy efficiency, but further action is needed if we are to achieve the transition to zero carbon emissions by 2030. Our report sets out how further progress can be made, with positive recommendations on how to remove constraints, invest in the right skills and technology, while giving industry and consumers the confidence needed to build zero carbon homes at the scale and pace required.”
Nigel Wilson, CEO, Legal & General, said:
“Our report demonstrates how Government, the housebuilding industry and others in the private sector all have a critical role to play in helping drive up energy efficiency in our homes. I hope that ministers look carefully at our recommendations to ensure that we are doing everything possible to improve the energy efficiency of our existing and future homes.”
Steve Wood, CEO, National House Building Council, said:
“Given the vast scale of the net zero challenge in the housing sector, clear action is needed. Our report sets out the roadmap to decarbonise millions of homes. Crucially, we must keep on driving progress towards net zero in new build homes at the same time as radically accelerating the decarbonisation of our existing stock.”