‘Strategic reset’ from Government urged for Net Zero homes

UK Finance says a ‘strategic reset’ is needed for the country and government to achieve Net Zero homes.

The organisations say this is ‘the number one policy issue facing future generations’.

In a report, it says that UK homes are the least energy efficient in Europe, with the heating of our homes representing 14% of our total carbon emissions

But the expected bill of £300 billion to reach the government’s required Energy Performance Certificate ratings for private and rented homes means that a fresh approach is required.

UK Finance also says that EPCs are ‘not fit for purpose’.

Radical action to achieve a Net Zero housing

The report, ‘Net Zero Homes: Time for a reset’ proposes radical action to achieve a Net Zero housing stock in the UK.

UK Finance is calling on the government to:

• Prioritise public funding to retrofit social housing. Funding should be used to expand the Social Housing Decarbonisation Fund. Prioritisation should be given to social housing most appropriate for heat pump installation, and retrofitting should also be focused on social housing areas with high rates of fuel poverty, to help reduce energy bills for residents.
• Provide government grants to vulnerable populations. These should cover the full upfront cost of energy efficiency improvements and low carbon heating systems. For households with a greater ability to pay for retrofitting, a smaller upfront grant should be offered with the option to supplement this with an interest-free loan or low-interest rate loan to cover the remaining cost.
• Amend Stamp Duty Land Tax (SDLT) to incorporate the property’s energy demand and carbon emissions. Stamp Duty rebates should become available if energy efficiency improvements are completed within two years of property purchase. The amendments to SDLT should be made after 2025.
• Amend Energy Performance Certificates (EPC) so they are fit for purpose. EPCs are an outdated way of representing energy efficiency, and there is a significant time-lag in updating the EPC database. Energy efficiency improvements must be reflected in EPC ratings on the date of installation.
• Implement minimum energy efficiency requirements. A minimum rating should be introduced for owner-occupied housing, required for the sale or re-mortgage of a property. This should be phased in between 2030 and 2050. The requirements should include exceptions for vulnerable populations who could otherwise become property prisoners.

‘Climate change is the number one public policy priority’

David Postings, the chief executive of UK Finance, said: “Climate change is the number one public policy priority facing this and future generations.

“The challenge we face means we can no longer just consider our options, but instead need to see strong action. In housing this means addressing the impact of heating the UK’s 28 million homes.”

He added: “Our new report sets out a range of recommendations to help deliver net zero in the UK’s housing stock, ranging from supporting vulnerable people with the costs of energy efficiency improvements to providing grants and subsidies to upskill tradespeople.

“The banking and finance sector is playing a key part in facilitating the transition to net zero.

“The transition must be done in a fair way that does not leave anyone behind, which is why we believe that in order to make real progress everyone must work together, led by clear, decisive and supportive government action.”

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