Jun 17, 2021

Fund Net Zero… (but not what you think)

At SHIFT Environment we are truly committed environmentalists.  Which is why, as well as running our consultancy business, we spend some of our time engaging with Government, regulators and key organisations.  This has led to the creation of SHIFT’s “Fund Net Zero (but not what you think)” campaign.

It is already well established the vast sums of capital required to achieve net zero carbon. The Committee of Climate Change estimates £3.5 billion of retrofit funding is required annually for the social housing sector alone[1]. The funding gap clearly exists and there are already a chorus of calls to Government to provide far more expansive and rapid funding for decarbonisation.

We agree that ultimately far more funding is needed and the sooner it is made available the better, but our campaign approaches this challenge differently by promoting concepts that we believe are low cost / cost neutral.

Building to EPC A

We have two key approaches that we are highlighting in our meetings with Government and the decarbonisation roadmap we are producing with National Housing Federation. The first concept is for Government is mandate that all new tenures must be built to EPC A rating. When considering social housing, many landlords are using average SAP for their housing stock as a surrogate net zero target. By adding homes that are EPC A (~SAP 95), the average SAP rating will increase by a large amount especially as social housing providers often have ambitious plans for building new homes. This means that less retrofit is required on existing stock to achieve a high average SAP rating which will result in huge cost savings across the whole lifecycle of a home and is a high impact approach that Government could implement almost immediately.

Financial returns from warmer homes

The second concept is implementing financial incentives for landlords to deliver warmer homes and there are several suggestions for how this could work. One example is for landlords to receive annual payments from Government after work is completed, rather than up-front grants. ‘Warm rents’ is another option but can be a divisive idea with some housing providers concerned that this system could raise the risk of fuel poverty, but we are keen to point out that we suggest only a fraction of expected fuel bill savings should be captured within this warmer rent model to ensure that residents who are already energy conscious still make savings. This system could make homes warmer, reduce overall household bills for residents and provide an investment recuperation method for landlord that enables further works across their stock without Government funding necessarily required.

If you would like to discuss our campaign, access our briefing notes or attend our building to EPC A roundtable event on the 3rd August please get in touch: [email protected]

[1] https://www.theccc.org.uk/wp-content/uploads/2019/07/The-costs-and-benefits-of-tighter-standards-for-new-buildings-Currie-Brown-and-AECOM.pdf