We Need a Budget for Green Homes

By Alistair Darling
April 9, 2009

The chancellor's new budget should provide strategies to make all existing homes
super-energy efficient, to slash our energy bills, create jobs and help meet our
carbon emission targets.

Household energy consumption is responsible for 27% of all UK carbon emissions
(pdf), and these emissions are not falling but rising 18% higher than in 1990,
according to research from the Stockholm Environment Institute, leaving one in
six households in fuel poverty, according to Energywatch.

The Sustainable Development Commission's Home Truths report (pdf) showed that
75% of existing houses will be here still in 2050, when we need to have cut
national emissions by 80%. John Doggart, the chairman of the Sustainable Energy
Academy, calculates that to treat all existing homes by then we need to tackle
half a million per year, at a cost of 20-30,000 each. This, Mr Darling, would
create 200,000 jobs. The overall cost would be 2bn a year and could be
financed 50-50 private/public to kickstart the transformation, he estimates.

Doggart is a member of the Existing Homes Alliance, a coalition of concerned
bodies that has launched The Declaration of the Future of Existing Housing.

There are multiple-win benefits that can be derived from refurbishing our
existing homes to high environmental standards: relieving fuel poverty, tackling
security of supply, economic competitiveness, unemployment in the building
sector, and meeting half of our 80% target to cut greenhouse gas emissions by
2050. The government does know this and is consulting on it the deadline is 8
May but, as usual, it is acting too slowly; under its proposals, work would
not begin until 2012. The jobs, cost and carbon savings are needed now, and in
his budget Darling needs to put money behind energy and climate change secretary
Ed Miliband's proposals. The Conservatives and LibDems have proposed giving up
to 6,500 to every household in the UK for energy efficiency improvements (not
enough). But what is also needed is the systematic integration of policies and
actions that already exist.

In practice, eco-refurb is the most economic when integrated into other
renovation activities; but this doesn't fit in with our piecemeal approach to
targets. It is much easier and cheaper to put in the kind of measures that are
necessary in a home at the same time as doing other refurbishment activities
like replacing rotten timbers, replastering, window replacements, loft
conversions or extensions. Furthermore, one solution does not suit all homes, so
more work needs to be done on finding optimum solutions for each type.
But even once work has been done on a home, we cannot currently be confident
that it is not "a bodge job". A study by Gerard Mimmo, an MSc student the Centre
For Alternative Technology, of fifty house refurbishments [not online] found
that only 15% achieved all of their targets of energy efficiency. This is
because building control officers don't understand or are indifferent to
compliance with the building regulations, in particular part L. The Public
Accounts Committee (Pac), in a report published on 2 February, said it was
shocked to discover that most of them see energy as a second or third-tier
matter of medium-to-low interest. Revealingly, there has never been a
prosecution for non-compliance with Part L, because it is not life-threatening;
contrast this with prosecutions for breaches of health and safety or even equal
opportunities. But arguably climate change is more important than either. No
building control officer would now withhold a certificate form a developer on
the basis of a breach of part L.

In an attempt to tackle this, the Department for Communities and Local
Government (DCLG) has admittedly provided some training for building control
officers and introduced new enforcement powers, and is considering new proposals
for the inspection process but again this needs more urgency, otherwise it is
more government lip service to the environment or, to use language Darling
understands not obtaining value for money.

This apathy is all the more worrying when it's realised that over 80% of the
government's hoped-for energy savings by 2020 are supposed to come from building
regulations and obligations on suppliers under the Carbon Emissions Reduction
Target (Cert) and other measures. Builders are certainly often to blame, through
their lack of knowledge, costcutting, and market forces. The UK's Cert scheme is
currently seen as our best chance of meeting the targets; for an extra 35 a
year on our taxes we get 400m a year of domestic energy-efficiency measures.
But this is another piecemeal activity that is not integrated.

Let's put this in perspective: 24bn a year is spent on doing up homes. There
might be a 15-20% increase cost in tackling energy issues at the same time, but
there is an overall saving far greater than doing the two things separately, and
it has a payback period of around 10 years. Hundreds of thousands of jobs are
possible. Additionally, a standard is required for eco-refurbishment and a
property should not be able to be sold without such a label. Energy Performance
Certificates show the current and potential energy consumption of a property,
but they are not yet accurate enough.

We have the technology to do what's required. The much-needed innovation lies in
service delivery. As with the low-carbon buildings programme, contractors could
register to be associated with such a project. Spot checks would then check the
quality of their work and they would be removed from the approved list if they
did not perform.

Other constructive measures from the chancellor and Ofgem should be: VAT
should be pushed down to 5% for labour, we should get council tax rebates for
eco-refurb, cheaper loans and mortgages, energy tariff reforms, feed-in tariffs
and incremental block tariffs for implementing energy efficiency measures.
Because the standing charge is so high that lower earning consumers pay more per
unit, it would be fairer if the unit for energy billing was changed to kWh per
metres squared per year.


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