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ACE’s response to the Mayor of London’s draft London Housing Strategy

Our response to the Mayor of London’s draft London Housing Strategy consultation can be read here. Further details about the draft strategy can be found here.

ACE welcomes the vision and principles of the draft London Housing Strategy and agrees with the Mayor that London’s housing crisis is a barrier to prosperity, growth, and fairness for Londoners.

Improving the energy efficiency of London’s housing can deliver prosperity and growth, by supporting economic growth in the environmental goods and services sector, supporting London’s transition to a zero carbon city; and fairness by lowering energy bills of both new and existing homes and eradicating fuel poverty across the capital. Action to improve energy efficiency can also support activity to improving air quality.

ACE’s response to this consultation focuses on four of the five priorities set out in the draft Housing Strategy:

  • Building Homes for Londoners;
  • Delivering genuinely affordable homes;
  • High quality homes and inclusive neighbourhoods; and
  • A fairer deal for private renters and leaseholders.

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Combatting ‘rogue landlords’

ACE’s response to the Communities and Local Government Committee inquiry: Private Rented Sector: Combatting ‘rogue landlords’ can be read here.  Further details on the inquiry can be found here. A wide variety of organisations have also responded, which can be read on-line here.

Key points in our response

  • Fuel poverty in the private rented sector continues to be a major problem across England and Wales.
  • The Housing Health and Safety Rating System (HHSRS) gives local authorities the power to enforce minimum housing standards related to Excess Cold, thus tackling fuel poverty. However, research has found that HHSRS is not being used nearly as widely or effectively as it could be.
  • Approximately 300,000 properties will be impacted by the introduction of mandatory Minimum Energy Efficiency Standards (MEES) in 2018, however ACE has significant concerns in relation to the effectiveness of the implementation of these regulations.
  • It is essential that both minimum standards are effectively implemented, however there are many obstacles to effective intervention, including limited awareness and resources to implement legislative requirements, and a lack of information to strategically target properties.
  • ACE considers that selective licensing is an important tool in raising both energy efficiency and wider housing standards.
  • Complaint mechanisms are not functioning for tenants facing problems in their homes and tenants fear retaliatory eviction.

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ACE’s response to the Mayor of London’s draft London Environment Strategy

ACE welcomes the vision and principles of the Mayor of London’s draft London Environment Strategy and the ambition for London to be a zero-carbon city by 2050.

We agree that the city’s most pressing environmental challenges are harming Londoners’ health and the city’s economy, and that the current pace of change is too slow. The Mayor highlights that big problems need ambitious responses. Therefore, we would like to see the Mayor’s activity and focus on air quality continue, but also expanded in relation to improving the energy efficiency of buildings, improving the lives and reducing health inequalities of those households that are in fuel poverty, whilst supporting economic growth in the environmental goods and services sector.

Our full response to consultation on this strategy can be found here.

 

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ACE’s response to the Mayor of London’s draft Fuel Poverty Action Plan

ACE welcomes the publication of the Mayor of London’s draft Fuel Poverty Action Plan for London to help support the eradication of fuel poverty across the capital. We agree that fuel poverty remains at unacceptable levels and that it has not received the attention that the issue deserves.

ACE’s response covers four key topics:

  • Supporting the roll-out of borough referral networks.
  • Improving the energy efficiency of London’s homes, with a particular focus on improving standards in the Private Rented Sector.
  • Energy for Londoners.
  • How the Mayor should work with the UK Government.

Our full response can be found here.

 

 

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Private Rented Sector energy efficiency and the Clean Growth Strategy

Our Research Director, Kelly Greer, reflects on what the publication of the Clean Growth Strategy means for MEES in the Private Rented Sector and introduces our new project ‘the Warm Arm of the Law’. We are looking for evidence and support for this work, which examines proactive and strategic enforcement of minimum standards in the PRS.

Clean Growth Strategy

Soon after my last blog about Minimum Energy Efficiency Standards (MEES), the Government published the Clean Growth Strategy. Improving energy efficiency in the private rented sector makes a couple of appearances in the strategy.

The Government have committed to consult on how to make the MEES regulations more effective. However, we don’t yet know what this means…The introduction of a cost cap? Reducing the timescales associated with exemptions to enable landlords to take advantage of new sources of funding and finance? Providing guidance to landlords, local authorities and First Tier Tribunals around the validity of self-certified statements within the exemptions register?

There was also a commitment to look at a long-term trajectory for energy performance standards across the private rented sector, with the aim of as many private rented homes as possible being upgraded to EPC Band C by 2030, where practical, cost-effective and affordable. ACE welcomes this long-term trajectory as the message to landlords should be to take greater action now – beyond EPC band E – so that they benefit from not having to undertake additional works in the future.

The Government have noted that they will be considering options ‘with a view to consulting in 2018’. ACE will of course respond to these consultations once published.

Alongside the Clean Growth Strategy, a series of consultations and calls for evidence were published. Building a market for energy efficiency is seeking data, evidence and ideas on additional measures to encourage energy performance improvements and, while focussed primarily on the owner-occupied sector, some of the solutions identified may also be applicable to the private rented sector. ACE will be responding to this consultation and would welcome your views on the applicability of proposals to the private rented sector.

The Warm Arm of the Law: reducing fuel poverty in the private rented sector

ACE, working in partnership with CAG Consultants, has secured funding from Ebico Trust to look at how the Housing Health and Safety Rating System (HHSRS) and MEES can be proactively and strategically enforced to support the eradication of fuel poverty in England and Wales.  This project builds on previous research focused on HHSRS (*) and has support from a range of stakeholder organisations.

ACE and CAG would welcome local government practitioner views, as well as those from the wider industry, and are seeking evidence of best practice in terms of:

  • Raising awareness of minimum standards within local government departments.
  • Working with landlords and residents about their requirements and rights.
  • How to target enforcement action and ensuring resource levels within local government are maintained.
  • Examples of successful enforcement cases.

Please contact Kelly Greer on kelly@ukace.org to share any information that could feed into the project (information will be kept confidential where requested).

(*) Impetus Consulting Ltd, 2008, Tackling fuel poverty using the Housing Health and Safety Rating System (HHSRS); NEA, Impetus Consulting Ltd and Blooming Green, 2011, HHSRS: your power to warm homes in the private rented sector (policy report and toolkit)

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MEES: a missed opportunity?

Our Research Director, Kelly Greer, reflects on the publication of guidance on the minimum efficiency standards for homes in the Private Rented Sector.

BEIS has finally published the guidance for landlords and local authorities on the minimum level of energy efficiency required to let domestic property under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015. We welcome the publication of the guidance and the clear message that it sends about the benefits to landlords and tenants of improved energy performance. But we worry that it contains loopholes that will mean that action to eradicate fuel poverty and improve the energy efficiency of properties may not be taken.

The legislation sought to improve the energy performance of the worst properties to an acceptable standard of energy efficiency (EPC band ‘E’ or above) and thus to improve living conditions for around 300,000 private sector rented households across England and Wales. However, the potential for landlords to claim an exemption and the reliance on local authority enforcement suggest that the regulations in their present form could potentially have little effect.

This is particularly worrying since the guidance’s introduction highlights that ‘Living in private rented accommodation significantly increases the likelihood of a household being fuel poor, so much so that around a third of all fuel-poor households in England live in the private rented sector, despite the sector accounting for only around a fifth of all households in England and a seventh of the households in Wales.
Amongst EPC F and G rated properties in the sector, recent data shows that 45% of households are classified as fuel poor. Put simply, the PRS has a disproportionate share of the UK’s least energy-efficient properties and fuel-poor households. Installation of energy efficiency measures can help address this’.

Inaction will therefore leave thousands of tenants paying higher energy bills for years to come. Climate Action charity 10:10 estimates that this could leave tenants paying an extra £200 million in energy bills every year.

ACE, with other key stakeholders in the sector, fought for the introduction of a cost cap within the regulations, below which landlords would be expected to fund improvements to bring their properties up to an EPC E standard, in place of the current ‘no cost’ provisions.

This principle of ‘no cost to the landlord’, within the current regulations, means that landlords of F or G rated homes will only be required to make improvements to these properties where they can do so entirely using third party finance from one or more sources.  Sources of funding landlords can access include the Energy Company Obligation (ECO), which has been significantly reduced in size and scope over the past few years; local authority grants, which are somewhat thin on the ground in these times of austerity; and the now privatised Green Deal Finance Company (yet the government’s own impact analysis of the regulations suggest that 30% of private rented sector homes wouldn’t be able to meet the Green Deal’s ‘golden rule’ and therefore wouldn’t be eligible to take up the finance).

The ‘no cost’ requirement also makes the regulations far more administratively complex, both for landlords and for local authorities as enforcement agents.  If a landlord chooses to register an exemption from the regulations on the basis that the changes would involve cost to them, they simply have to provide a self-certified narrative explanation for why no suitable funding could be obtained to fully cover the cost of installing improvements. How can local authorities check the validity of self-certified statements? ACE has recommended to BEIS that more detailed guidance on this area should be produced for both landlords and local authorities.

Local authorities can serve enforcement action on landlords who they believe are not meeting the regulations, and landlords can appeal the decision via the First Tier Tribunal process.  This will be an interesting area to monitor as the regulations come into force in April 2018, as with housing enforcement local authorities take a cautious approach. They will not risk using their resources to robustly defend cases that may be quashed on appeal by tribunal judges. It is therefore essential that any guidance produced is also disseminated to tribunal panels.

ACE also has particular concerns about the 5 year timeframe for exemptions, and how there is no mechanism to take account of changes in the funding landscape within this period. Those working in the energy efficiency sector know that the funding landscape can change dramatically on a frequent basis.  This long exemption timeframe means that chances to access funding are a missed opportunity to maximise the effectiveness of MEES. We must stress that it is important to strike a balance on this timescale – too short and it is too burdensome for landlords, but too long and the effectiveness of MEES is reduced.

We could take a positive view of the situation, and assume that landlords, understanding the benefits to themselves and their tenants of higher energy performance, will simply choose to pay for lower-cost measures themselves rather than seeking funding or an exemption.  For many, the cost could be as little as £600.

Any action by landlords, whether paying for improvements themselves or actively seeking funding sources, relies on landlords assuming that enforcement will be robust, however we believe that it will not.

A key point raised by ACE in the past is whether or not local authorities will enforce the standards. Both Environmental Health and Trading Standards departments, who are set to enforce these regulations, have seen significant cuts to their resources. The fallout from under resourcing local government can be seen in various ways. For example, the decline of living standards in private rented housing as well as the re-emergence of food safety scares. There are suggestions that Trading Standards are not actively enforcing the requirement for rental properties to have EPCs, and we are concerned that this will happen with the MEES regulations.

Another element missing from the guidance is how the government plan to strengthen the energy performance requirements over time. The message to landlords should be to take greater action now – beyond EPC band E – and that they will benefit in the long run by not having to undertake additional works in the future.

The introduction of these standards is a real step in the right direction, and could lead to significant improvement in some of our worst properties.  But unless government make it simpler for landlords to undertake works than to try and avoid the regulations, it risks failing to deliver.

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Our response to Scottish Government’s consultation on energy efficiency and condition standards in private rented housing – a Scotland Energy Efficiency Programme Consultation

We welcome the Scottish Government’s consultation on the topic of minimum energy efficiency standards in the Private Rented Sector and consider that this is a vital first step to ensure that all homes in Scotland are energy efficient, enabling tenants to be warmer in their homes and use less energy. Fuel poverty remains a significant issue in Scotland, and across the wider UK, particularly in the private rented sector. Increasing the energy efficiency of these properties is key to reducing this problem

To realise these benefits, the Scottish Energy Efficiency Programme must be an ambitious programme for low-carbon refurbishment of Scotland’s exiting homes, including a package of measures – attractive finance; the provision of free advice and support; and the introduction of a minimum energy performance standard for all privately rented homes.

This consultation on standards for the private rented sector represents an important step towards realising this vision.

Read our response to the consultation here

See the Scottish Government’s consultation site here

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Energy Efficient Buildings,Non-domestic building,Public Buildings

Energy efficiency policy for workplaces: quick wins for the next Government?

We all know that there is no single ‘magic policy bullet’ that will support the growth of a self-sustaining market for energy efficiency investments, and that a jigsaw of policy pieces is needed to build the necessary framework.

This is the first in a series of blogs looking at ACE’s new policy tracker, and it considers commercial buildings.  It asks, are all the jigsaw pieces in place?  What more can we do easily? And what is going to be a little more difficult?

Where we are now

The Committee on Climate Change identified a least-cost pathway to meeting the 5th carbon budget.  Our analysis of the gap between this and the Government’s projection of emissions given the current policy landscape, shows that – by 2030 – commercial buildings will be emitting 42% more carbon than the ideal, and public sector buildings 34% more.  And the excess energy use involved is costing businesses a lot of money: in London alone, businesses spend over £4 billion per year on gas and electricity; if they could reduce their energy use by a third, that would mean over £1.3 billion every year for these businesses to use on something more productive.

In policy terms, a quick look at the policy tracker clearly shows that we’re really not doing very well.  We don’t appear to have a vision for our commercial buildings, nor do we have an overall target for their energy efficiency.  And we’re not very good at celebrating the achievements of those companies that are working hard to improve their energy productivity.

We have no comprehensive and engaging tax incentives to encourage energy efficiency investments, and there is little action by government to encourage the development of attractive finance offerings.

On a more positive note, the minimum efficiency standards for offices in the Private Rented Sector will result in improvements to our worst commercial buildings, making them better workplaces and hence supporting happier and more productive workers.  We do have energy performance certificates to give organisations information about the premises they are buying or renting, although the requirement for these could be better enforced.  And, in the past, central and local government has taken the lead, through energy demand reduction targets and National Indicators on carbon emissions.

And finally the good(ish) news: products policy has driven up the minimum efficiency standards of widely used appliances, and ESOS has ensured that larger business at least have the tools to understand their energy use and the potential for improvement.  Both these success stories are potentially at risk during Brexit, but we can act to avoid this.

The quick wins

There are some politically and practically easy steps that government and business can and should take right now. The Clean Growth Plan needs to set a high level of ambition for our offices, offering a vision of healthy, comfortable workplaces that support increased productivity; setting a target for commercial buildings energy efficiency and a trajectory towards achieving that target.

The public sector needs to once again set an example: we need targets for energy efficiency in the sector, and public reporting on progress towards these.  Implementing this will help Government achieve the efficiency improvements that it is looking for from the sector without taking money away from public services.

We need a clear message from Government that existing minimum efficiency standards for products, and requirements for energy auditing, will be retained as we exit the EU; and indeed that these policies, which have reduced business energy bills, will be enhanced in the future.

And we as businesses should collaborate on schemes that recognise those companies that are taking a lead in managing their energy use and celebrate their success.

Next steps

Beyond these easy wins, there are other things that won’t be quite as straightforward, but which really do need to happen.

Our existing minimum energy performance requirements for new buildings should be strengthened – by reinstating the trajectory to zero carbon – and our requirements to report on the energy performance of all buildings better enforced.

The review of business energy efficiency taxation has simplified the system but we are still not at the point where all fuels for all users are taxed equitably according to their impact on the climate; and we need to complement the tax with a requirement for public reporting on energy performance for larger companies.

And Government needs to work with the finance sector to ensure that all businesses wishing to invest in energy efficiency (including SMEs) can access attractive finance offerings to support these investments.

If we get these things right, and if we work with the construction trades, we could begin to tap into the already significant market for building refurbishment to ensure that energy performance improvement is a core part of any refurbishment project.

Difficult to do, but we must work out how

Expanding the use of minimum energy performance standards in existing buildings seems to be very difficult politically, and yet business is quite able to deal with regulation in all sorts of areas, provided that it is given sufficient warning and helped to understand how best to respond.  So we should be looking at how we can widen these standards out from the Private Rented Sector and how we can strengthen them.

And we need to bring energy efficiency investments to the top of the pile for business decision-makers: tax incentives for businesses to invest in energy efficiency again seem to be something that Government is reluctant to think about and yet, without them, energy audit recommendations risk being nice projects that get left on the shelf when something more interesting comes along.

 

We’re really not doing that well at the moment, but surely it is time now for Government to act on some of the easy wins whilst working with us on plans for the next steps.  And we should not shy away from the more difficult steps  – the prize: more competitive businesses, a happier and healthier workforce, and greater energy resilience, is too important!

 

Do have a look at the details in our snapshop policy tracker and let us know what your view is.  And if you are interested in finding out more about why we think some policy changes are easier than others, have a look at Chapter 6 in our 2016 report on Buildings and the 5th Carbon Budget.

We look forward to policies developing over the coming months and we will be updating the tracker in response to these changes.

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data,Energy Company Obligation,Green Deal

DECC’s Household Energy Efficiency Statistics: the good, the bad and the whaa…?

Liz Warren is a founder and director of SE2, a small consultancy helping individuals, communities and organisations build their capacity to respond to climate change. You can find out more about their work at www.se-2.co.uk.

DECC recently published statistics on the take-up of energy efficiency measures by households during 2015.  In this blog post, we unpick some of the data, exploring the good, the bad and the frankly baffling within the rich data set provided. How did policy announcements affect the market? Have whole-house energy assessments unlocked energy efficiency opportunities? And could we have found the elusive answer for improving the private rented sector?

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