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Nearly 30% of the UK’s CO₂ emissions come from the country’s 26 million homes – with their demands for heating, lighting, hot water and electricity-hungry appliances. To reach the UK’s target of reducing carbon emissions by 60% by 2050 – or even 80%, as the target may have to be raised to – a significant reduction in emissions will have to come from housing. But how can we tackle the problem?

While the UK Government has set ambitious targets for all new built homes to be zero-carbon by 2016, the vast majority of the existing stock of housing remains inefficient.

The Federation of Master Builders (FMB) recently commissioned the University of Oxford’s Environmental Change Institute to undertake research into the nature of the problem and how it can be addressed.

The results have been published in a report, Transforming the UK’s Existing Housing Stock, which outlines 18 recommendations for central and local government, training bodies and builders.

Energy Efficiency News talked to the report’s author, Gavin Killip of the University of Oxford, about how the UK’s existing housing stock can be made more energy efficient and low-carbon refurbishment can go mainstream.

What is the nature of the problem?

To reach the government’s target of a 60% reduction in carbon emissions by 2050, it makes sense to reduce energy demand. Existing housing stock is wasteful and the potential for improvement is enormous. In fact, the UK has one of the least efficient housing stocks in Europe in terms of thermal performance. We have a short window of opportunity over the next 5–10 years to build the capacity in the construction industry to integrate low-carbon technologies into the mainstream. If we could do half a million jobs a year, it would still take over 40 years to upgrade the entire housing stock.

What efforts are being made elsewhere?

Canada has pioneering standards of what can be done, but this has not been rolled out across all housing stock yet . France and Switzerland have applied the Minergie standards (which stipulate 50 kWh per m² per year for heating, hot water, cooling and mechanical ventilation) to around 10,000 buildings so far. Germany has ambitious targets to upgrade around 17 million buildings to a highstandard in 20 years. But despite a wide ranging programme to help householders, which includes preferential loan rates for refurbishment, information and advice, only one million buildings have been retrofitted in the last nine years.

So how can low-carbon refurbishment be encouraged in the UK?

We advocate an approach around market transformation – similar to the approach that has been successful in improving the energy efficiency of appliances such as fridges and freezers. The approach – which is unproved in the buildings sector – relies on three pillars: information for the market, incentives for innovation and mandatory performance standards.

But the problem is huge. There is an impatient minority who are motivated by doing their bit for the environment, if affordable, and an even smaller minority who will do it whatever the cost.

But many others are ignorant of the benefits. Low-carbon refurbishment is about health, comfort and the environment. It is possible to appeal to people’s ethical values, as well their pockets. For those who haven’t yet seen the benefits of low-carbon living, a simple meter in the home that displays energy consumption can have an enormous impact on behaviour.

For those who do undertake low-carbon home refurbishments, existing technologies like better insulation, energy efficient lighting and appliances can cut carbon emissions by as much as 65%. In terms of CO₂ emissions, we will have to go lower than this, which means a huge increase in the number of low- and zero-carbon technologies integrated into the built environment.

Your report focuses on builders, in particular, as being crucial to the adoption of low-carbon refurbishment. Why is that?

There is no point advertising a service that is not available, so builders are key. The people with the pencil and the tape measure need to be brought up to speed really quickly – and the skills that will be necessary for low-carbon refurbishment work aren’t so difficult.

Crucial to encouraging builders is having products that work and are available. This needs a long-term and consistent signal from Government so that the supply chain will scale up its product lines. This sort of commitment would also encourage the introduction of new and existing products into the UK market from Europe and elsewhere.

And this represents a huge new market for small builders – the people we rely on to repair, maintain and improve our properties. The construction industry stands to gain between £3.5–6.5 billion per year from the low-carbon refurbishment agenda in UK housing. This is about long-term sustainable job creation, as well as the social and environmental benefits.

As well as encouraging uptake, does the UK need standards for low-carbon refurbishment?

Much more use could be made of the potential of the Energy Performance Certificates (EPC), which grade a home’s energy performance on the familiar A–G scale. There are problems with the EPC at the moment but, assuming these can be sorted out, the certificate provides information on energy performance into the market for the first time – and it does so on a sufficiently large scale. This could become the public expression of a minimum standard for energy performance. Initially, the standard would have to be voluntary while we develop the skills and infrastructure to deliver. Ultimately, we will need to move to a mandatory system.

What has been the response to your report?

The response has been overwhelmingly positive and I couldn’t ask for anything more. The campaign by the FMB has received endorsements from all the party leaders and Green MSP Robin Harper has even tabled a motion to adopt all the report’s recommendations in Scotland. Ministers in the Welsh Assembly Government have also welcomed the report.

The Government is also planning on consulting on green homes in the future, with a policy document likely in spring 2009.

Could the downturn in the building sector be good news for low-carbon refurbishment?

There is a huge growth opportunity here. The UK already spends around £23.9 billion per year on maintenance and refurbishment. For only a marginal extra cost, these refurbishments could be low-carbon.

One of the things the FMB is calling for is a reduction in the current VAT rate on refurbishment from 17.5% to 5% to discourage tax-dodging and cash-in-hand deals. The marginal cost of doing the low-carbon options when other work is being carried out is 13–15%, so a 12.5% reduction on the bill through VAT reform would go a long way to equalising the cost.

Other financial incentives, such as top-up loans from mortgage providers could provide the up-front capital that householders need to undertake low-carbon work.

Sustainable growth in the building sector is good news for the economy, builders, consumers and society as a whole. But there is room for failure – for the simple reason of a lack of joined up thinking and processes. Organisations across many sectors will have to work together in partnership to tackle the problem.

¹Canada has very recently announced the intention of broadening the scope of existing performance standards to increase energy efficiency even further. For further details, click here or see related news story.

For further information:
Transforming the UK’s Existing Housing Stock (2008) Gavin Killip, Environmental Change Institute, University of Oxford.

Federation of Master Builders: Building a Greener Britain

Environmental Change Institute, University of Oxford