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Government must commit £23bn over next 10 years on ‘retrofit revolution,’ says green commission

  • 20/05/2022
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Government must commit £23bn over next 10 years on ‘retrofit revolution,’ says green commission
The government needs to kickstart the “retrofit revolution” with major investment as many properties, especially low value properties, cannot meet energy efficiency requirements.

According to the latest report from the Building Back Britain Commission, in the average English local authority 58.4 per cent of homes are below the Energy Performance Certificate (EPC) band of C and it will cost around £200bn to get them up to this standard.

There is upcoming legislation that could mandate that from 2025 rented property has to be EPC rated C or above.

The commission is made up of major organisations in the UK, including chief executives of Barratt Developments, Legal & General, Mace, Thakeham, NHBC and Riverside Group.

It noted that there were five key risk factors around the effectiveness of retrofit, which includes very low EPC rating, old housing stock, conservation requirements, low market value and EPC band C being unattainable with current technology.

The report said that the “tipping point” for homes was £162,000, with homes under this threshold “likely to be financially unviable” for retrofit without financial support as the cost would exceed house price gain.

It continued that one third of homes in levelling up areas were below this critical price threshold.

It added that in the UK there were 2.8m homes valued at under £162,000 with an EPC below C in levelling up areas.

The report noted that 10 per cent of homes could not reach an EPC band C with current retrofit technology, and this rose to 20 per cent in the city of London.

The commission urged the government to prioritise low-value housing in levelling up areas, adding that this would help progress towards net zero target as it would give people more energy security.

It also called for new build properties that are going to be constructed to have the “highest possible levels of emissions reductions”.

The report added that new build developers were already making “significant steps forward in recent years” and new build homes emit two tonnes less carbon each that average existing homes.

However, the report said that more needed to be done to “remove constraints and enable the transition to net zero to happen at the scale and pace required”.

Actions include partnering with the private sector on policy, encouraging more sustainable developments and promoting deeper integration of modern methods of construction.

It continued that the private sector would have a “critical role” to play in providing additional capital to improve energy efficiency through things like green mortgages.


Five key actions

It said over the next 10 years, householders in low value homes the government should provide grants via public borrowing.

Householders in higher value homes should be able to secure low-interest unsecured loans over the next decade at similar rates to government borrowing.

Funds from growth in investment should be used to create incentives,, through research and development tax credits, for the uptake of net zero construction technologies.

It added the government should consult on how to improve the take-up of green mortgages and review residential property taxes to see if changes could be made to increase demand for energy efficient properties.

The report said that the government should acknowledge the challenges that “older homes beyond realistic repair” and establish “housing decarbonisation zones”, where Homes England and local authorities develop local programmes to replace this housing stock.


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