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Response to Communities and Local Government Committee select committee report into existing housing stock and climate change
Contents
1. Significance of existing housing compared to new build
Environmental sustainability in the housing sector is not just about new build housing, and the race to develop zero carbon homes. Improving the energy efficiency of the UK's existing housing stock will have a far greater impact on reductions in carbon dioxide emissions and in turn be effected by growing effects of climate change. The challenge is now to deliver both mitigation and adaptation.
Existing housing accounts for 99 per cent of all housing in the UK, and by 2050 will still account for 75 per cent of housing. Over 500,000 existing homes would have to be refurbished every year from now until 2050, if we are to meet the Government's long-term target of cutting carbon emissions by 60 per cent. This is a monumental task and already the housing industry is failing to keep pace.
The housing sector urgently needs to develop an overarching environmental strategy that focuses on existing stock as well as new homes. The challenge for the sector is to reduce fossil fuel use by creating a clear energy hierarchy that focuses on:
· Energy production (energy to the home) · Energy demand (the energy efficiency of the home) · Energy use (the use of energy by people in the home)
In new build properties there is far greater opportunity to impact on energy production and energy demand. New homes provide us with a blank canvas to create buildings that have very low energy demand that is supplied from community energy, low carbon and renewable energy sources.
These are all technologies which Places for People has installed or is piloting in numerous developments across the UK. However, the challenges in new build homes are significant themselves and should not be underestimated.
Early estimates by Cyril Sweet Consultants, indicate that zero carbon homes will cost an additional £33k per unit and that the UK is ill equipped in skills, building and renewable technologies as well as basic infrastructure, to deliver this by 2016. The challenge for existing homes is even greater.
Once existing homes have the basic energy efficiency measures installed, such as loft and cavity wall insulation, the limitations - because of the existing fabric, impact on the community and neighbours, planning and the cost of refurbishment - shift the emphasis onto energy use and to a lesser extent energy production. Put in simple terms the options are far more limited and the costs much higher. It is no surprise therefore that much of the emphasis on improving energy efficiency has been on new build properties.
However Places for People has demonstrated how significant steps can be made to raise the standard of existing homes far above the national average. Through our 'Affordable Warmth' Strategy' we have invested millions of pounds in our homes, and have delivered energy bill savings for our customers of up to £200 year. This has seen our homes receive an average 'SAP' rating - which measures a building's energy efficiency - of 70:
Performance of the Sector (SAP 1-100):
For example, at one of our existing schemes in Newcastle we have installed new high efficiency boilers and small-scale combined heat and power units, which have reduced energy consumption by 25%.
The key to the investment has been the Energy Efficiency Commitment funding from energy companies. Places for People has had a strategic relationship with Powergen for over three years, to deliver this programme. The Energy Efficiency Commitment is the best example of a simple, focused and unbureaucratic funding programme.
The partnership has seen 6,500 homes insulated at a cost of over £3M; resulted in the installation of new energy efficient boilers, cavity wall and loft insulation; and has provided over 300,000 free low energy light bulbs to residents.
By working with Powergen we have been able to help over 100,000 customers save a massive £13.4M pounds in energy costs, whilst reducing carbon dioxide emissions by over 46,000 tonnes.
Furthermore Places for People are seriously concerned about the impact climate change will have on rising sea levels and the effects that this will have on existing housing stock in coastal areas.
It is estimated that global average sea levels will rise by between 9 and 88 cm between 1990 and 2100 (Intergovernmental Panel on Climate Change, 2003), forcing coastlines back by hundreds of metres, and placing thousands of homes in jeopardy.
As part of future proofing our communities, homes and business we have undertaken a detailed asset management strategy, which looks at the risk faced by coastal homes. This is an approach that balances climate change adaptation and mitigation.
2. The respective roles of residents, homeowners, landlords, local government, central government and the energy industry in promoting energy efficiency
Residents
Residents have a vital role in promoting energy efficiency, but are currently disconnected from energy production and carbon saving. By informing and empowering people we believe that significant savings can be made, both financially and in carbon savings.
Places for People is committed to delivering new homes and neighbourhoods that are of a high quality, have a limited effect on the environment and are cost-effective to run. As part of that vision it is also dedicated to encouraging its customers to think about the energy they use, its cost and impact on the environment.
It is currently trialing the use of 'Electrisave' smart meters at Broughton Atterbury, an environmentally friendly scheme in Milton Keynes. The simple devices show residents at any point in time how much electricity they are using and how much it is costing. Using a small display screen, placed anywhere in the house, it can also tell people how much harmful CO2 they are emitting, encouraging residents to think about the energy they may be wasting.
Tests in Australia have shown that they are one of the best ways of reducing a household's electricity bill - up to 25 percent. Whilst they are relatively new to this country, other country's are well advanced in installing smart meters - Italy for example has 33 million smart meters installed.
From 2008 all meters or replacement meters installed in the UK will have to be smart. However we are disappointed that the government has chosen to make display meters a legal requirement rather than using an incentive scheme, such as the EEC to distribute them. Using EEC - and so helping energy suppliers to achieve their energy saving target cost effectively - would have motivated the energy suppliers to market them as a positive offering to their customers.
We believe that the legal route taken will been seen as another requirement by utilities and it will be treated negatively and rely on informed consumers demanding display meters from their suppliers.
Places for People is interested in the wider potential of these units within their new developments and existing stock, and thus chose to trail the Electrisave meter at Broughton Atterbury and monitor the electricity use and gather feedback from users.
Initially 20 homes at Broughton Atterbury had a meter installed, free of charge and a further 20 homes were used to form a control group. In addition Places for People provided some simple tips on saving energy and using the Electrisave meter to help householders to get the most from the units and maximise their savings.
Electricity meter readings were taken at the 40 homes and the meters were read again after about a week to gain some early data. This second visit also provided an opportunity to check that the installed units were working and to engage with residents to understand what they thought of these devices.
The meters were then read again after about six months to get electricity use data over a longer period. At this point, those who had units were again asked about how they rated them. Homes in the control group were also provided with units at this point to enable some before and after data to be collected
The trials have shown that the average electricity saving on the estate is 13.8 per cent, helping residents to reduce their electricity bills and help protect the environment.
Motivating residents is the biggest hurdle but once achieved it has to be supported by good advice and guidance. The UK's consumers are currently very poorly served with energy advice. There is a patchwork of provision across the UK, some of it based on the Energy Efficiency Advice Centres, some on voluntary groups and local authority activity. Even the Energy Saving Trust supported EEAC network provides highly variable services and is rooted squarely in an old fashioned form filling output driven approach.
While there are some good examples, broadly this no longer meets the aspirations of consumers nor is it capable of rising to the challenge of delivering long term significant carbon savings.
Given the limitations on reducing carbon in existing homes, and the increased role of householders, good energy advice that produces long term changes is vital.
Homeowners
Incentives must be introduced for homeowners to encourage the uptake in energy efficiency measures and the use of renewable energy.
Places for People is keen to see the introduction of feed-in tariffs, which have been widely used in Germany, Netherlands, Norway and Sweden with much success. Feed-in tariffs work by paying an above-market price for electricity fed from clean technologies into the grid.
The German experience has been extremely successful. The country now has 200 times the solar power capacity and 10 times the wind energy capacity of Britain, despite our country being windier.
Furthermore it generates 12% of its electricity from various renewables, compared with 4.6% in Britain. It has created a quarter of a million jobs in renewables - a number that is growing fast. Britain has only 25,000, a number that represents the amount of jobs created in the industry in Germany in the past year alone.
The UK also has a very poorly developed energy services market - Energy Services being broadly the provision of the products of energy, heat, light etc, rather than just fuels.
Allowing the cost of energy effiency investment to become part of an energy supply contract, would revolutionise the UK energy supply markets.
Ironically the UK's position as a world leader in market deregulation should have made this possible. However the entire emphasis by Government and the regulator has been on driving down the unit price of energy and protecting consumers.
Whilst understandable in the 1990s at the early stages of market liberalisation, this has had the effect of stiffling any innovation in domestic energy supply. Ten years on, deregulation has delivered the savings it promised, but only in the short term, and has kept consumer confidence, but it must now move to a new stage that focuses on carbon saving and the need for long term investment in reducing energy demand.
Energy suppliers, and others, must be encouraged to create new energy service packages for residents, homeowners and landlords that reduce costs by reducing energy demand.
We also believe that customers should be given real time information on the amount of energy they are using and its cost. As has been demonstrated in our Electrisave meter trial at Broughton Atterbury, if you make the connection between energy use and its impact apparent to customers, then massive savings can be made.
Local Government
Local government has a clear role to play in supporting and promoting energy efficiency awareness. However if they are to meet Government aspirations on reducing carbon, they need to be setting local targets that feed directly in to the UK's targets. All too often standards are set which contradict and work against wider targets such as the Code for Sustainable Homes.
The recent debate about the 'Merton Rule' is a good example of this. Before the creation of the Code for Sustainable Homes, the Merton Rule, which required new developments to produce 10% of their energy from renewables, was a brave and innovative step by a local authority.
To now continue with this, when the primary aim should be to reduce energy demand, is at best a distraction and worst will undermine the delivery of better, lower carbon homes in the future. It would be better to be building lower energy demand houses than be building standard homes with renewable energy devices, simply to meet the Merton rule, and that have a lifespan much less than the house itself.
Local Authorities must also give far more support and encouragement to planners at all levels so they can make decisions that encourage and facilitate innovation and the use of renewable technologies. There is an ongoing crisis of confidence in planning departments, partly the result of simple lack of staff, but also because of a lack of training, skills and knowledge.
Places for People works with over 200 Local Authorities, and has found that even the most progressive authorities have a disconnect with their planning departments who stymie the use of renewable technologies.
For example we have been seeking planning permission to install wind turbines at a housing scheme, yet have faced constant delays over six months from the local council's planning department.
Each turbine is capable of generating up to 10kw hours of electricity per day, depending on the wind speed. We believe that a realistic annual amount at an urban site is 660kW hours, equating to a daily average production of 1.8kW hours. By using wind turbines, which operate at slow speeds with low noise emissions and vibrations, we believe we can provide free electricity to residents at the scheme, with any excess being relayed back to the National Grid.
Central Government
We feel that central government must shift the emphasis from low unit-cost energy to energy diversity and the use of local energy production and renewables. This can be done through:
· A planning process which facilitates community energy and reduces barriers to small-scale renewables
· Encouraging financial incentives, such as feed-in tariffs so that generating electricity from solar photovoltaics or wind, gets a guaranteed payment of four times the market rate - currently about 35p per unit - for 20 years
· Refocusing the role of the regulator, OFGEM, away from cost savings to carbon savings
· National long term targets including 10 year outline for building regulations
Even more fundamental is the lack of focus for UK energy policy. It is currently spread amongst DEFRA, CLG and Department for Business, Enterprise & Regulatory Reform (DEBRR) - this leads to competing priorities, no overarching strategy to reduce carbon emissions and a range of initiatives and policies that reflect the priorities of their own departments and not that of carbon reduction.
For example DEFRA funds the Energy Saving Trust that promotes energy efficiency in housing, but CLG is responsible for housing policy, at the same time DEBRR sets energy policy that has a vital role to play in sourcing and funding domestic energy provision. All have their own funding regimes, policies and strategies.
The UK needs one government department that is responsible for energy policy supply, sources, distribution, consumption, infrastructure, innovation and renewables and all with one goal - carbon saving.
The UK must establish a better way of bringing these issues together, otherwise carbon saving will remain confused, muddled and unfocused, and more importantly undelivered.
Landlords
Landlords have a vital role to play in improving existing homes. There are over 1,500 social landlords in the UK, and around 13,000 private landlords.
However there is little incentive for significant investment in energy efficiency simply because the cost of investment falls to the landlord yet the savings are made by the resident.
Programmes such as EEC have helped to close this gap but in the longer term new energy service and feed-in tariffs would have to be introduced to see further investment in energy efficiency and renewables.
If this became possible then landlords would be able to develop a strategic approach that develops an energy hierarchy (as described in section 1) and ensure that it is focused on carbon reductions.
Places for People has developed pilot schemes aimed at reducing carbon emissions and electricity consumption at Broughton Square in Milton Keynes by installing 'Electrisave' smart meters, slashing hundreds of pounds of resident's soaring fuel bills.
The simple devices show how much electricity you are using and how much it is costing. Using a small display screen, placed anywhere in your house, it can also tell you how much harmful CO2 you are emitting. The impacts for residents have been quite dramatic with savings of over 10% on energy costs but just as importantly it has changed the way resident perceive energy. No longer is flipping a switch divorced from impact but people can see what appliances cost the most - in both financial and environmental terms.
Places for People chairs the Managed Housing Group of the Energy Efficiency Partnership for Homes, funded by DEFRA and supported by the Energy Saving Trust.
The aim of the Energy Efficiency Partnership for Homes (the Partnership) is to achieve energy efficiency in homes and alleviate fuel poverty through engaging cooperation and collaboration within the supply chain for energy efficient products and services.
The Partnership has a comprehensive footprint within all relevant industry and social sectors and provides an effective mechanism for cross-sector cooperation and joint delivery of energy efficiency initiatives.
Places for People has chaired the managed housing group for the last two years. The Group has representatives from Sustainable Homes, BRE, the Housing Corporation, NHF, CIOH, Audit Commission and a range of housing providers.
Places for People would like to install further energy efficiency measures and renewable energy in all of its homes. However this currently has to be balanced with other demands for funding, such as kitchens, roofs and bathrooms that is paid for from rents. We would like to be able to install the measures and technologies and be able to recoup their cost through a 'Feed In' tariff or Energy Services model neither of which are currently available or practical.
A particular limitation for affordable housing providers is the inability for investment in carbon reduction to be reflected in rent levels, because of the constraints of rent convergence. If this situation had greater flexibility, more investment could be made available for the existing housing stock; with residents gaining the advantage of reduced running costs and carbon emissions.
Energy Industry
The energy industry has a key role to play but must adapt, if we are to make the step change in energy efficiency that is required, especially in existing homes. The UK industry led the world in deregulating, but is still based on the post war paradigm of large scale energy producers and long distance distribution paid for by meeting demand from consumers, rather than managing it.
However, one of the successes of this approach has been the Energy Efficiency Commitment, which whilst resulting in significant levels of investment, is still nowhere near that required.
Deregulation led to a welcome break up of the regional electricity and national gas monopoly, however it has led to an overemphasis, reinforced by the regulator, on reducing energy costs in the short term by reducing unit energy prices. Recent global changes in energy prices have shown that this is no longer sustainable and long term price stability can only be achieved by reducing energy demand, increasing energy diversity, reducing reliance on fossil fuel and increasing the use of renewable energy, with energy produced and consumed on a more local and regional level.
The UK approach to deregulation also led to the '28 day rule' that allows consumers to change supplier every 28 days - only suspended recently - which had some benefit in protecting consumers in the early stages of competition.
But it had become a barrier to developing an energy services approach that would allow investment in capital measures to be paid through on going revenue payments. Similarly this approach by the regulator and Government also appears to be one of the reasons why the UK has not developed the Feed in Tariff model that has transformed the German renewables market.
The 'Energy Efficiency' Industry
What must not be forgotten is the UK Energy Efficiency Industry - those employed in energy ratings, energy assessments, consultancy, advice, research and to a lesser extent energy efficiency measures and technology. This industry can be proud of some of the world class work it has done in developing standards and processes that have often been copied by other countries, for example the use of BREEAM and the creation of the international LEED standard.
However, this success has now become a barrier and the UK is now spending too much time and resources creating standards and requirements that are not actually improving energy efficiency. Examples of standards that now apply include SAP, NHER, RDSAP, EcoHomes XB, EcoHomes, Code for Sustainable Homes, Best Practice Standards, Scheme Development Standards, AECB Silver/Gold, Housing Quality Indicators, Lifetime Homes, Urban Design Compendium, Regional Sustainability Checklists, Zed Standards, zero carbon and various renewables targets.
Much of this work is also being repeated at regional and local levels as local authorities and regional assemblies try to 'out green' each other. Many of these are worthy targets in themselves but together they create a 'fog' of energy efficiency confusion and have in many cases become a substitute for real action.
For example new home-owners might receive an energy performance certificate, that has already two ratings on it, a SAP rating, a regional sustainability rating and code for sustainable homes rating. This does not lead to clarity for consumers nor does it help to build better, lower carbon homes.
The Energy Saving Trust is an integral part of this industry. Before carbon saving became the priority it is today, it worked hard, and often with limited and fluctuating funding, to keep energy efficiency on the agenda. We have worked successfully with both the Trust for many years and have received significant funding from its various programmes.
However their role in the past is now becoming a disadvantage and the Energy Saving Trust has simply not changed to meet the radical agenda shift we have seen in the last two years. The policies, guidance documents, good practice standards, events, consultations and discussions groups had a role to play, but this past is now informing and constricting too much of its future.
There is a role for a neutral, non governmental, organisation that asks the questions and provides the solutions that Government and the industry would always struggle to come up with. However the Trust, constrained by its past, is not it. It should be closed and new approach taken that's focuses on carbon reduction outcomes delivered to a clear timetable and preferably reflecting a similar change in government structures.
Places for People's experience of other countries, including our participation in DTI missions to Canada and Japan, have made it clear that what is needed is a clear national direction and only one standard that is applied to both new and existing homes. A standard that is understandable to the consumers, challenges the construction industry, is future proofed to avoid change, sets a clear timetable for improvement and delivers the long term carbon savings over time.
The UK has half of this in the Code for Sustainable Homes, but this has to become THE standard which will allow for the long term investment in skills, knowledge, technologies and user involvement that will deliver the savings needed. This should be backed up by one Government department and one non governmental organisation, all focused on delivering carbon savings.
3. Energy Performance in Buildings and the provision of information and prospective house buyers, including energy certificates
Places for People welcomes the introduction of the new Energy Performance in Buildings Directive (EPDB). We believe that providing a simple 'energy label' to all homes will help to create informed consumers and stimulate increased demand for more energy efficient homes.
Despite this we have serious misgivings about how the energy certificates will be implemented. The CLG proposals are too complex; too costly; lead to confusion for customers; and result in a reduction in energy efficiency investment in the UK.
Places for People has played an integral role in the implementation of the EPDB over the past two years. The Group;
· is the only housing group represented on the CLG stakeholder implementation Group from 2005
· is a representative on the CLG's technical group
· submitted a detailed response to the CLG's position paper in January 2007
· offered input in to the Regulatory Impact Assessment
· conducted national research and piloted certificates for Housing Corporation
· has taken part in the CLG Social Housing Pilots throughout Summer 2007.
· is the sole housing representative on the CLG implementation group September 2007.
We estimate that the building and housing industry will face significant costs as a result of having to implement the EPDB. Places for People faces an annual bill of around £1.5M, whilst the total cost incurred by housing associations offering social rented properties could top £40M.
There is a considerable risk that the EPDB could result in significant money being diverted away from low carbon measures into an overly bureaucratic form-filling process. Places for People is calling for an urgent review of the implementation of the EPDB.
We also believe that the Government backed methodology for undertaking an energy survey on existing homes (known as RDSAP), far exceeds the requirements of the EPDB and does not lead to more accurate or useful ratings or advice for consumers.
For example the energy consumption data is based on broad assumptions that are already out of date because it is based on 2005 data. This gives consumers misleading information about how much energy they are using and what it will cost them.
Furthermore the requirement for RDSAP to be changed every few years will result in a lack of consistency in calculating the energy efficiency of an existing home. A rating certificate produced for the same house, with no energy saving changes, would be different today from one produced in five years time. Again this will lead to confusion amongst consumers who have no concrete reference point from which to assess any recent changes made to a home.
This complexity also means that energy certificates will be expensive to produce. In the social rented sector, which has the most energy efficient housing of all, this could equate to £40m per year - funding that could be far better spent on reducing energy demand and fuel poverty.
Put simply, where is the sense in spending £100 for a certificate that tells someone they would benefit from a loft insulation, when the £100 could have delivered the insulation and improved the energy performance of the home.
An alternative would be to use existing data sources such as annual stock condition surveys to generate energy reports, which could be labelled as the code for sustainable homes for existing homes. This would still provide consumers with the same information and give them a clear understanding of the actions they can take to reduce energy demand. It would also avoid millions leaking out of energy investment into bureaucracy.
4. Government efforts to reduce carbon emissions from existing housing stock whether in the private or public ownership and other related programmes
Government programmes like Warm Front, Energy Efficiency Commitment (EEC), Blue Skies, Low Carbon Building Programme, Decent Homes and the Energy Saving Trust have had some success, but they are no longer able to meet neither either the need for change nor consumers' appetite for change.
These programmes and initiatives were all products of a time when energy efficiency was seen as an optional extra. They are also separate entities that rarely work together efficiently towards a common goal. For example Blue Skies and the Low Carbon Building Programme are aimed at building the market for renewables; Warm Front to tackle affordable warmth, but only in certain sectors; the EEC to achieve carbon savings and deliver affordable warmth; and Decent Homes aimed to improve in broad terms social housing, but has had a minimal impact on energy efficiency investment.
Research commissioned by Places for People through the Energy Efficiency Partnership for Homes has indicated that over £14bn needs to be invested simply to eliminate fuel poverty in UK housing. At the same time the UK spends over £1bn per year on winter fuel payments that is having no long term impact on reducing fuel poverty or reducing carbon emissions.
Places for People believes that a streamlined approach could improve efficiency, where the focus is solely on carbon reduction, which is backed up by the code for sustainable homes.
With the exception of the EEC programme, most of the above initiatives have been overly bureaucratic and do not deliver the scale of investment that is urgently needed. Similarly the Decent Homes Standard has delivered significant improvements in housing standards, but is set too low to make any impact on reducing carbon emissions.
To reach the level of carbon reductions that are needed, Places for People proposes that:
· One national standard is adopted
· Adopting a model based on the German feed In tariff. Feed-in tariffs work by paying an above-market price for electricity fed from clean technologies into the grid. This has been enormously successful in Germany. If you want to roll out micro-generation and renewables, it is the cheapest, most-effective way to do it
· The development and promotion of energy services models.
5. The technologies available to reduce emissions and the governments role in facilitating relevant further technology development
The UK renewables industry has had an enviable reputation at various stages in the past but is now little more than a cottage industry. This is the time for business and the housing industry to show leadership, and play a major role in cutting carbon emissions. By adopting a sustainable approach it can incentivise business; create new opportunities; and develop technologies that will help reduce carbon emissions and greenhouse gases.
If we do not invest in the renewables industry , the impact will be poor quality renewables that are high in cost, yet low in availability. The problem will seriously hamper efforts by the housing and business sectors to meet the Government's targets to cut carbon emissions.
There are a range of simple renewable technologies available, which have been extensively piloted across the country. These include:
Solar Thermal
The technology is simple, relatively cheap to install and cost effective.
Ground Source Heat Pumps
This technology has been around for a number of decades, and is popular in countries such as America. The system is a simple one that basically transfers the heat that already exists in the ground in to the homes heating system.
Wind
The process of using wind power to generate energy can be done on both a small and large scale basis. There have been many misconceptions around large-scale wind turbines. However we believe that the technology will have a key role to play in the next 20 years. The UK has more usable wind power than any other European country, and large scale wind turbine farms on and offshore will become a major supplier of electricity to the national grid. However that aside, small scale wind production is at a critical point. It is in serious risk of over-promising and under-delivering.
Combined Heat and Power (CHP)
Small scale and domestic. Small scale is once again on the agenda and may have a critical role to play in new housing developments. Domestic CHP has had a faltering start with only one product on the market which is still being imported from New Zealand.
Biomass
Places for People believes that biomass technologies have an important role to play especially in combination with CHP, However technological problems have stunted any wider uptake of the technology, and the supply and storage of fuel is a major issue. We also believe that there are still major issues to be resolved around the impact biofuels will have on food supply and price increases. There are already clear signs that the world's thirst for environmentally friendly biofuels is driving up food prices on a global scale.
Heat recovery and ventilation
This could be a simple and effective technology that delivers highly insulated homes.
While there may be some new products emerging over the next decade, it is not the technologies themselves that are the barriers - it is their cost; their quality; the industry that produces them; the cultural and skills barriers to their use; the planning obstacles; and the lack of incentives that allow high capital costs to be paid off over time.
It must be remembered that renewables are not the answer but only part of it, and we should conform to the energy hierarchy, i.e. to reduce energy demand first, and then consider where the energy comes from and how it is used. This is a much greater challenge in existing homes with limited opportunities for improving the existing fabric beyond basic insulation measures.
Places for People would propose a range of measures, in order to ensure that the UK has a world class renewables industry. For example we would propose:
· That a national programme be drawn up to develop the renewables industry. This must also have a serious focus, and central investment on research and development, and in to how production can be scaled up.
· The removal of stop-start grant funding, which hampers the uptake of renewable technologies.
· The replacement of winter fuel payments with a UK energy efficiency investment programme over 15 years.
· The introduction of feed-in tariffs, similar to the German experience, which now has 200 times the solar power capacity and 10 times the wind energy capacity of Britain. Feed-in tariffs have also be used in Norway, Sweden, and the Netherlands with considerable success. It is vital that we learn from these experiences.
At Places for People we have piloted and installed a number of the above technologies in developments across the UK.
For example we have been working closely with Viridian Solar, a new solar panel manufacturing company, to develop a new product that is low cost, efficient and high quality. As a result the cost of the units are less than a quarter of traditional solar thermal systems making them far more affordable for new housing.
In 2006 Places for People installed the innovative solar hot water systems in Places for People homes to rent at Norfolk Park in Sheffield. The pilot is part of our ongoing national research into renewable technologies. In conjunction with other technologies we are working on, it can be a useful method of achieving higher renewable energy targets on our developments. Above all, it offers our customers significant savings on their energy costs.
We have recognised that we must invest in the technologies now to ensure that we have input into their design, and also to ensure that their supply continues to be available and their costs low. In 2007 Places for People joined the board of Viridian Solar to make this possible.
We have also built a number of schemes that incorporate renewable technologies and meet today's high energy efficiency standards. This includes; Broughton Atterbury in Milton Keynes which is one of the largest schemes in the country to obtain the old EcoHomes Excellent rating; ground source heat pumps in Cambridge; wind turbines in Milton Keynes; solar panels in Sheffield; and a highly efficient district heating system in Edinburgh.
This is important, as renewable and low carbon technologies are destined to play an increasingly important role in housing in the future. They bring a wide range of benefits including reduced carbon emissions, increased energy diversification, and the protection against future energy price rises so helping to eliminate fuel poverty.
This environmental work was recognised when we won a Gold Award for Environmental Sustainability from the Housing Corporation in 2007, beating off strong competition from 26 property groups.
Yet we realise that we must do more. We will continue to move our environmental agenda forward in the next few years. Our five-year EcoPlan called Beyond Carbon sets out our vision to deliver Zero Carbon homes, a low carbon business and affordable warmth for our residents.
It will include much research, partnering to realise new ideas, and a range of ambitious projects to deliver the long-term results needed to create a more sustainable future.
6. The costs associated with reducing carbon emissions from existing housing, who would meet those costs and particularly, in respect of low-income households, interaction between carbon emissions and the government's ambitions to reduce poverty
The costs associated with reducing carbon emissions from existing housing, who would meet those costs and particularly, in respect of low-income households, interaction between carbon emissions and the government's ambitions to reduce poverty
We believe that the long-term aim must focus on stripping out the costs of reducing carbon emissions from the system. This can be achieved by:
· Making the overall objective one of carbon savings - so whichever approach is used then that becomes the outcome.
· The replacement of winter fuel payments with a UK energy efficiency investment programme over 15 years.
· Encouraging clear standards, timetables and targets, and removing bureaucracy from the system, as is highlighted in the EPDB and the competing grant funding regimes.
· Creating a world class renewables industry that can deliver high quality, low cost products.
· Developing the funding regimes that allow the high capital costs to be spread over long periods of time, such as in Germany and the use of energy service contracts.
· Allowing landlords to benefit from the investment in renewables.
Ultimately there is a cost to this but it will only be met if the costs are spread amongst the energy industry, consumers, government, landlords and local authorities.
Largely there is a connection between reducing carbon and reducing energy costs. Places for People recognise that energy costs are the second biggest household expenditure and have a direct impact on poverty.
Through our involvement with the Energy Efficiency Partnership for Homes, we commissioned a national piece of research on energy prices and the impact on fuel poverty (people are classed as being in fuel poverty when they are spending more than 10% of their household income on energy).
This highlighted the disproportionate impact that energy price rises have on low income households:
· Between 2003 and 2006 electricity prices surged by 39 per cent and gas prices by 61 per cent, plunging an extra 1.73 million households across all housing tenures into fuel poverty.
· 1 in 3 people (or 650,000 households) renting from a local authority or registered social landlord struggled to meet rising energy bills in 2006, paying an average £814 a year. These households are now three times more likely to be fuel poor than tenants in 2004, who paid £590 per year on bills.
· By 2016 nearly 25% of social housing residents would be at risk of fuel poverty.
Places for People is committed to helping eradicate fuel poverty amongst its customers. As well as piloting a range of technologies, we have worked with numerous partners in order to offer customers affordable warmth and energy.
However, even with this investment we need to do far more and we are now developing a wider range of interventions including;
· A tariff swapping service
· Investing in renewable energy
· Promoting and making available comprehensive energy advice
· Running energy awareness events
· Reaching a SAP 65 target for all homes
In the majority of cases these interventions will also lead to carbon savings, and the principle that carbon saving also reduces costs is reinforced.
7. The specific challenges which may arise in relation to housing of special architectural or historical interest.
The impact on buildings of special architectural or historical interest is an area which has little impact on the vast majority of existing homes in the UK, although our housing stock in Edinburgh is subject to significant limitations which reduce our ability to improve energy efficiency.
The real barrier for most housing is the specific challenges which arise in relation to existing stock and the planning system. All too often the focus is on 'the visual amenity' of buildings when considering technologies such as wind turbines in urban areas, rather than the potential environmental gain, even in densely populated urban environments.
For example we have been seeking planning permission to install wind turbines at a housing scheme, yet have faced constant delays from the local council's planning department, despite the obvious benefits that they will bring to residents.
8. Recommendations
· Energy policy and strategy, at all levels, must become the function of one Government department rather than the current three. Its ultimate aim should be carbon reduction. This should be reflected in any non governmental agencies, any grant regimes and the regulator.
· Urgently review and radically simplify the CLG's proposals on implementing the Energy Performance in Buildings Directive (EPDB)
· Set one national energy standard for both new and existing homes - the code for sustainable homes
· Set a clear timetable to meet new building regulations standards
· The replacement of winter fuel payments with a UK energy efficiency investment programme over 15 years
· Have a stated national aim of creating a world class renewables industry by 2015, and introduce tax incentives for investment in UK renewables
· Introduce a feed in tariff system, similar to the German model
· Support the introduction of energy services models that would fund energy efficiency measures and renewables for householders, but also be available to landlord
· Close the majority of Government funded grant regimes for renewables and energy efficiency measures. These to be replaced by market incentives such as energy services, feed-in tariffs and the continuation of EEC
· Any Government financial support to go towards building a world class renewable energy industry
· Implement the proposal to allow small scale renewables to be a permitted development
Appendix A About Places for People
Places for People is one of the largest property development and management companies in the UK, with around 59,000 homes either owned or managed in a mixture of different tenures. With 2,500 employees, it is a unique organisation that provides a diverse range of products and services to build quality, safe and sustainable communities.
In 2006/7, Places for People had a £330m turnover and a not-for-dividend profit of £19.7m. During 2006/07, we built 1,202 new homes and had a £2.5 billion asset base. In addition we achieved a full set of green lights in our last Housing Corporation Assessment (October 2005).
Places for People regards itself as a housing and regeneration organisation that puts people first. We provide solutions that not only cover a range of different housing tenures but also offer a range of support services including affordable childcare, elderly care and financial services - all the things that contribute to making neighbourhoods of choice; prosperous, popular and truly sustainable.
Places for People currently has 44,600 affordable rented properties, 4,800 properties available for market rent and some 9,000 properties where we retain a freehold stake as part of either shared ownership or 'right to buy' arrangements in a number of developments throughout the UK.
Our portfolio is designed to 'Create neighbourhoods of choice for all' and covers the following broad mix of products:
· Places for People Neighbourhoods - investment, regeneration & placemaking
· Places for People Homes - neighbourhood & property management
· Places for People Individual Support - support for independent living
· Places for People Property Services - in-house maintenance services · Places for People Development - master planning & building new developments
· Places for People Financial Services - financial products for customers
· Places for Children - early years childcare
· Emblem Homes & Blueroom Properties - lifestyle homes for sale & rent
· Making Places - a joint venture with Cofton, set-up to acquire land and deliver thousands of homes over the next five years. When we create new places for people to live we plan a mix of tenures and house types designed for communities that have people from different social backgrounds.
All of our homes whether for sale or for rent are designed and built to the same high standards with the same specification making different tenures indistinguishable.
In February 2007 Places for People formed Making Places, a new joint venture with Cofton - the land regeneration and development specialist - to acquire land and deliver thousands of homes across the UK.
The venture has been formed to procure land for large scale and complex developments that will help to address the country's chronic housing shortage and meet the growing demand for new high quality, energy efficient homes. The partnership will invest £300M in land acquisition over the next two years and currently has plans to develop over 14,000 new homes on sites in Newcastle, Swindon, Corby and Harlow.
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