On May 7, General Election day, ACE launched its seven key energy efficiency asks (#7ACEasks) for the next Parliament. They are (also available in a PDF):
The cheapest, safest and most secure form of energy is the energy we do not use. That is why energy efficiency must be allowed to compete on equal terms with new supply capacity. In the past UK energy policy has focused heavily on the supply-side – power stations and fuel distribution infrastructure – as opposed to reducing demand for energy. We urgently need a new Energy White Paper that puts demand reduction on a level playing field with conventional supply-side measures.
There is a gaping hole at the heart of the UK’s National Infrastructure Plan. The most crucial element of our infrastructure – the bricks and mortar of the homes we live in and the places we work – is missing from the Plan’s list of priorities. No other investment can achieve as much to help struggling householders and businesses, stimulate economic growth and create jobs in every constituency in the UK. As part of this, we are calling for:
- home energy efficiency to be made a top infrastructure priority;
- investment to be supported with a long-term revenue stream;
- 2 million low income households to be made highly energy efficient by 2020; and all 6m such households to be brought up to this standard by 2025.
Both national and local government are significant owners, lessees and occupiers of non-domestic buildings – and therefore have a huge role to play in helping to drive the market for energy efficiency. The new Government should start by making it mandatory for public bodies to procure energy efficient buildings. The energy performance of these buildings must be clearly displayed to demonstrate that the public sector is leading by example.
The last Government proposed to dilute the previously agreed Zero Carbon standard for new homes. This proposal must be reversed, and a genuine Zero Carbon Homes standard must be introduced via Building Regulations in 2016. The proposed exemption for small sites is not justified and must also be withdrawn. For commercial buildings, there is still no clear definition of what Zero Carbon means, nor is there a clear trajectory towards the 2019 target. As an urgent priority, the new Government must work with industry to clarify the definition and to set out the timeline to 2019.
ACE successfully campaigned for a minimum standard (Energy Performance Certificate Band E) to be introduced in the Private Rented Sector from 2018. Unfortunately the new regulations allow landlords to be exempted from the standard if they can’t make the necessary improvements without incurring upfront cost. This loophole must be removed to prevent a two-tiered approach and huge administrative complexity. In addition the new Government should:
- broaden the scope of the minimum standard to include houses in multiple occupation, which are often home to our most vulnerable citizens;
- consult swiftly on introducing minimum standards in the owner-occupier and non-domestic sectors;
- set out a trajectory, giving the market adequate notice, for tightening existing and future minimum standards.
In order to stimulate the market, we must introduce systemic incentives to encourage the able-to-pay to invest in retrofits. These should include:
- revenue-neutral stamp duty and/or council tax adjustments that reward more energy efficient homes. These would lead to between 650,000 and 1.75m additional retrofits every year;
- revenue-neutral business rate adjustments that encourage small business owners to invest in improvements.
Access to competitive finance for energy efficiency investments is critically important. We therefore need a concerted and sustained initiative, led by Government, to enable lenders and borrowers to understand the attractiveness of energy efficiency as an investment, and to unlock the use of personal and business loans and mortgages. This initiative should include:
- increasing the attractiveness of Green Deal finance by reducing the interest rates on offer through Government underwriting;
- enabling a wider range of lenders to access this low-interest capital and offer it to their customers;
- banks providing highly competitive loans (underwritten by Government) to their small and medium-sized business customers for the installation of energy efficiency measures;
- increasing awareness of, and trust in, energy services and third party finance offerings to all businesses, and encouraging these businesses to consider funding energy efficiency investment from sources other than in-house funds.
For more information, contact Jenny Holland, Head of Parliamentary Team at email@example.com.