An ambitious new infrastructure programme is needed to help to decarbonise the UK’s buildings – and a sweeping new plan shows what it could look like
The proposals, developed by Frontier Economics for a group of 28 NGOs, thinktanks, businesses and trade bodies, would also boost the economy and help to meet legally-binding carbon and fuel poverty targets, its backers say.
In a new report, they present a range of policies which could be taken up or trialled by the government in order to move forward on energy efficiency.
It has long been recognised that the government has failed to produce sufficient energy efficiency policies to keep it on track with its carbon targets.
A number of energy efficiency schemes have been closed without a replacement in recent years.
These include the Warm Front, a taxpayer funded grant programme, which was closed in 2013 and the Green Deal, which provided loans to help homeowners improve the energy efficiency of their property and was closed in 2015.
The Zero Carbon Homes target for new homes, which was set to come into force in 2016, was also scrapped in 2015, while the Energy Company Obligation, which requires energy providers to subsidise home insulation, has been downsized.
As a result, the annual number of major energy efficiency measures installed in homes dropped by 80% between 2012 and 2015, from 1.74m down to just 340,000. The government’s own projectionsshow emissions from homes are in line for a 10% increase by 2035 under its current set of policies.
Meanwhile, the UK remainsoff track to meet its legally-binding fourth and fifth carbon budgets. The government has long promised to fill this policy gap with a new carbon plan – which would be expected to include energy efficiency measures. This is now due to be published in October.
It is against this backdrop that today’s report present a broad set of proposals to put the UK’s energy efficiency efforts back on track.
This includes a public investment programme to incentivise improvements to households’ energy performance, as well as new regulation.
Under the plan, all UK homes would be required to meet a minimum energy performance by 2035. The report suggests this long term target could be set at Energy Performance Certificate (EPC) band C. Around 19m properties fall short of this, equivalent to 71% of the UK’s 27m homes.
Several different publicly financed schemes would be used to push the EPC rating of homes up to this band. Low-income owner-occupiers would get fully subsidised retrofits, while there would be a 50% subsidy for council and housing association homes. Private properties let to low-income tenants would get a 33% subsidy.
The report also suggests a range of demonstration schemes are set up in the “able to pay” sector to help homeowners retrofit their houses to a C rating. These trials could use partial grants, income tax relief along the lines of the ‘Cycle to Work’ scheme or below-market loan interest rates.(The last of these would differ from the Green Deal by offering lower interest rates. It would also be demonstrated and refined before scaling it up and would drop Green Deal’s “Golden Rule”, which said expected savings must be at least as great as the cost of implementing the energy efficiency measure.)
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