After emerging from a significant bedding-in period since entering government, Labour is now at a point where it must turn its talk on net zero into action. When it comes to energy supply, those across industry know all too well the challenges and considerations required to achieve this – the key remains convincing policymakers which aspects they should prioritise.

On the demand side, government has been keen to trail plans for replacing fossil fuels and reducing the strain on the grid – and we are approaching a crucial phase of industry input. One of these upcoming policies is the Warm Homes Plan, an initiative promised in Labour’s manifesto and scheduled to be fully unveiled in the spring.

The Warm Homes Plan aims to ‘slash fuel poverty, and get Britain on track to meet our climate targets’, through measures such as grants and low interest loans for energy efficiency upgrades, and improved minimum energy efficiency standards for the private rented sector. In the autumn, a first wave of measures was announced, with a full plan to be formulated by the spring. This included a boost to the Boiler Upgrade Scheme home heat pump grant, removal of the need for planning permission to install a heat pump, and a reiterated commitment to increase energy efficiency standards for all rented homes by 2030. It will build on the long-running Energy Company Obligation (ECO) whereby energy suppliers deliver home energy improvements to low-income households.

The rhetoric so far has been encouraging, suggesting an appreciation of the importance of both a warm home to ensure a healthy life and of lessening demand side to contribute to a smoother energy transition. However, at the coalface of one of the greatest and most urgent political changes required in our lifetimes, net zero requires much action as its targets inch ever closer.

How to improve private sector homes’ performance
BRE recently published a briefing calling for fast action in the Warm Homes Plan, based on analysis of data from the official English Housing Survey (EHS).

The good news is that the latest EHS statistics show that, for first time, over half – 52% – of homes now have an Energy Performance Certificate (EPC) banding of C or better. That’s the standard which government programmes have long used as a marker of reasonable energy efficiency.

The rhetoric so far has been encouraging, suggesting an appreciation of the importance of both a warm home to ensure a healthy life and of lessening demand side to contribute to a smoother energy transition.
 

Some 90% of the remaining homes below EPC C are in the private sector, either owner-occupied or privately rented. While 8.3 million homes under EPC C are owner-occupied, the tenure with the highest proportion of below EPC C homes is, predictably, privately rented. With these two categories representing very different demographics, each requires a different solution from government, tailored to each context.

The government has come into office committed to regulate for higher standards in private rented homes, and that includes energy efficiency. The government is planning a minimum EPC rating for rental properties of EPC C ‘or equivalent’ by 2030. The challenge here will be enforcement and guaranteeing the significant investment that will be needed from councils to sufficiently monitor progress.

When it comes to owner-occupied housing, the task becomes slightly more complex. Low-income households should remain the priority for ECO and government funding programmes. However, to achieve reasonable energy efficiency across the board by 2035, the Warm Homes Plan will need to enable engaging and cost-effective retrofit offers of advice and financing targeting homeowners at all income levels. A particular focus needs to be on older people – those aged over 65 account for more than 40% of owner-occupier homes below EPC C, according to the 2021 EHS.

Local and regional authorities will be key. The government’s Devolution White Paper commits to providing mayors with control of retrofit funding to ensure robust delivery of the Warm Homes Plan at a local level; this set to be legislated in the upcoming Devolution Bill.

Which homes to target?
The future of the ECO programme has a bearing on the Warm Homes Plan. In its current form, the scheme runs to 2026. Currently, suppliers have flexibility to choose which homes to retrofit and which actions to take to meet their ECO targets. For the next phase of the scheme, a question for the government may be how to best align suppliers’ ECO delivery with a strategic, regional and city-level approach to public retrofit, led by mayors.

The unveiling of the government’s Warm Homes Plan will be a critical moment for industry. BRE and several other organisations have made their recommendations – and our research has directly quantified the economic, health and social impacts of leaving the UK’s homes in a substandard state. BRE would like to encourage cross-industry collaboration to tackle this essential component of our energy transition. There is a broader opportunity for the energy sector to make its voice known on the supply-side impacts of retrofitting our homes.

The views and opinions expressed in this article are strictly those of the author only and are not necessarily given or endorsed by or on behalf of the Energy Institute.

• Further reading: ‘Cold comfort: improving the energy-efficiency of UK building stock’. Cold, damp, shoddily-built properties blight millions of British lives. Yet opportunities abound to do something better, and there are great examples of forward-thinking building and retrofit, using fabric and design that create far warmer homes, their energy use greatly reduced. Why is there not far more of this, and what is the UK government doing about it?
• Find out how the heat generated from cooling data servers, among other low-carbon technologies, is being used to warm the homes of social housing tenants in a government-funded trial project in south-east England.