There’s only a scant possibility of meeting the UK’s lawful target of net zero emissions by 2050 without intense action this decade to insulate Britain’s 19 million draughty homes and switch from gas boilers to low-CO2 heating, say MPs.
In Energy Efficiency of Existing Homes, the latest report of the influential cross-party Environmental Audit Committee, the MPs slam the UK government’s flagship home insulation scheme, calling it “botched, disastrous in administration, devastating in some of its impacts, and in urgent need of rescue”.
This judgement comes as ministers prepare to host landmark UN climate talks – COP26 – in Glasgow this November.
Grant scheme failure
The Department for Business, Energy and Industrial Strategy (BEIS) said over 33,000 Green Homes Grant vouchers, which offers vouchers of up to £5000 (AU$8940) – or £10,000 (AU$17,900) for those on low incomes – worth more than £142 (AU$254) million have already been issued.
But just 10 per cent of its target to upgrade 600,000 homes in six months was met. The MPs say it failed spectacularly because too many householders were chasing too few installers, who suffered delays in the grant payments so were unable to stick with the scheme.
They heard reports of businesses laying off staff to cover loss of income rather than creating the green jobs as heralded. The time and bureaucracy involved for builders to register with the scheme in the first place also put many off, leading to a paucity of installers.
The report says: “Government failed to consult industry adequately on its delivery, set a timescale which was overly short-term and has presided over scheme administration which appears nothing short of disastrous.
“The impact of botched implementation of the GHG has had devastating consequences on many of the builders and installers that can do the work, who have been left in limbo as a result of the orders cancelled and time taken to approve applications.”
The missing jobs
Jess Ralston, of the Energy and Climate Information Unit, said that “The benefits of getting this right are crystal clear; hundreds of thousands of skilled jobs, lower bills, less carbon and more comfortable homes. The only barrier to climate-proofing our homes is government inaction.”
The lack of government investment and signals to the energy efficiency sector is doing little to incentivise businesses to upskill engineers and installers.
Brian Berry, from the Federation of Master Builders, told the committee: “The market needs certainty because small companies are not going to invest unless they know there is a long-term market. We need to give encouragement to these small companies that this is not just a flash in the pan, it is not going to be a repeat of the previous Green Deal [for housing loans, which was scrapped].”
The government has also underestimated the costs to decarbonise UK homes by 2050, at between £35 billion (AU$62.6 billion) and £65 billion (AU$116 billion), MPs said.
And this price tag does not include older solid walled properties, or those in conservation areas, which make energy efficiency installations more challenging.
Around 19 million UK properties need energy efficiency upgrades to meet Energy Performance Certificates minimum band C. This can cost on average £18,000 (AU$32,200) (before a heat pump installation), making the total cost likely to be far greater than the government’s estimate, MPs were told in evidence for the report.
BEIS says that it is investing £9 billion, yet it admits that not all of this is eco-efficiency. “This includes funding for the first hydrogen-powered houses,” it said in a statement.
It says it is “allocating more than £500 million this year alone to improve the energy efficiency of 50,000 households in social and local authority housing.”
Yet the MPs in their report are concerned that the government has actually announced only just over £4 billion (AU$7.15 billion) of the £9.2 billion (AU$16.45 billion) committed to in its 2019 manifesto for energy efficiency measures.
In a post-covid green recovery, jobs in this sector would represent great value for money, and the MPs want to see schemes such as the Home Upgrade Grants, Social Housing Decarbonisation Fund and phase two of the Green Homes Grant Local Authority Delivery Scheme front-loaded and rolled out without delay.
Environmental Audit Committee Chairman, Rt Hon Philip Dunne MP, said: “Making 19 million homes ready for net zero Britain by 2050 is an enormous challenge that the government appears to have not yet grasped.
“In the next 29 years, the government must improve energy efficiency upgrades and roll out low carbon heating measures: a material start must be made now.
“Government investment to improve energy efficiency has been woefully inadequate. The £9.2 billion (AU$16.45 billion) that the government pledged at the election was welcome, but 16 months on, there appears to be no plan nor meaningful delivery. Funding allocated for the Green Homes Grant has not been spent, with only £125 million (AU$223.5 million) worth of vouchers – of the £1.5 billion (AU$2.7 billion) budget – issued.”
“In a year where government action on climate change will be put under a microscope due to hosting the global climate summit, these warnings from the EAC should be taken very seriously,” commented Greenpeace UK’s head of climate, Kate Blagojevic. “A properly funded and properly run scheme to improve the energy efficiency of homes … would save thousands of unnecessary deaths each year and the NHS billions of pounds. It literally ticks all the boxes from levelling up to real climate action.”
Dunne also called for better consumer advice that makes clear the necessity and benefits of retrofits, that “although installations may be disruptive for a short period, in the long run consumers can enjoy warmer homes with lower energy bills.”
He also said, “EPCs are outdated and should be replaced with Building Renovation Passports, which set a clear pathway to decarbonise homes.”
“A much better understanding of cost, pace, scale and feasibility of skills development is desperately needed for net zero Britain.”
Some other recommendations include:
- A rollout of Building Renovation Passports, replacing EPCs.
- Solutions for energy efficiency improvements in homes currently out of scope in the government’s “cost effective, practical and affordable” criteria.
- Making the social rented sector subject to the same standards as the private rented sector.
- An ambitious, realistic trajectory for owner occupiers to achieve minimum EPC C standards.
- Reducing to 5 per cent the rate of VAT on refurbishment and energy saving materials, plus restoring its scope to cover energy storage, heat pumps and electric vehicle charging.
- New green mortgages, green finance and low-cost loans.
- Making the new national infrastructure bank able to finance energy efficiency, as the one in Germany has through its state funded low interest loan scheme.
- Offering a bespoke energy efficiency advice service for English consumers similar to that in Scotland.
“Energy efficiency is a precursor to the transition to low-carbon heat, so action must be taken in the 2020s to set homes on a decarbonisation trajectory to meet our net-zero targets,” the report concludes.
The Conservative government, in power for over ten years, has a poor record on energy efficiency in homes.
After it took over from the previous Labour government, schemes promoting energy efficiency in homes were cancelled, leading to a 97 per cent drop in homes installing cavity wall insulation.
It then launched the Green Deal scheme, which failed abysmally, and since then no serious scheme has replaced it until this one.