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EST Article on the Government’s Green Homes Grant

Energy efficiency in the home Print publication

18/11/2020

The Energy Savings Trust (EST) has recently published its position on the Government’s Green Homes Grant (GHG) scheme[1]. The EST considers that the GHG scheme (which will provide £2 billion in funding towards energy saving homes-improvements) represents a good start on the Government’s pledge of £9.2 billion in funding towards energy efficiency investment, which was contained in the 2019 Conservative Manifesto.

However, the EST is clear in its message that the GHG alone will not be enough and that to adequately address the issue of 16 million thermally inadequate homes, this rate of investment must be maintained (and even increased) throughout the 2020s. The EST therefore recommends a target to bring as many homes as possible to an adequate standard of energy efficiency by 2030 (a minimum of Energy Performance Certificate level C or equivalent fabric standard).

The EST cites inertia as the main barrier to achieving this ambitious goal. Put simply, people have busy lives and do not want the hassle of retrofitting their homes. There is also a lack of information concerning the process and its benefits, and where people do have access to the necessary funds, most would prefer to spend this money on something which they perceive would add value to their home, such as a new kitchen.

The EST therefore suggests that a policy change may be necessary to provide an incentive for retrofitting. It suggests that minimum energy efficiency standards could be introduced when homes are sold, rented or at major renovation. This could mean, for example, that homes would need to meet the required standard at the point of sale or would need to be brought up to standard within a reasonable timeframe afterwards (with exemptions for homes that are intrinsically difficult to retrofit).

The possible implications of new regulations in this area could include:

  • poor energy efficiency would be viewed as a risk factor to be priced into mortgage offers;
  • homeowners would be aware that any investment in time, money and hassle to make energy efficiency home-improvements would be reflected in higher house prices; and
  • there would be opportunities for companies working in the home improvement sector to offer ‘add-ons’ to improve fabric efficiency alongside related measures, such as solid wall and floor insulation as part of an extension, or solar panels as part of roof works
  • the impact would go beyond owner occupiers and extend to landlords with buy-to-let portfolios and also to larger corporate landlords with larger portfolios of older housing stock.

Although the EST believes that regulations introducing minimum standards are necessary, it also considers that this alone does not go far enough and such changes need to be part of a wider framework of support including funding (for low-income households), finance and incentives, and technical and practical support. However, due to the massive scale of retrofitting required to achieve our net-zero targets even large scale regulatory changes may only go so far. The biggest challenge is likely to be engaging and persuading home owners to make or accept changes to their properties in what are likely to be financially challenging times ahead for many  and the ability to provide financial support and incentives.

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[1] A government backed scheme under which homeowners in England, including landlords, can get up to £5,000 to pay part of the cost of energy saving measures like insulation. Low income households can get 100% of the costs of work covered up to £10,000. (https://greenhomesgrant.campaign.gov.uk)

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