Sustainable housing: costs and
consumer demand
40. The National House-Building Council (NHBC)
referred us to a recent report which they said suggested that
some aspects of low or zero carbon designs would be difficult
to sell to potential buyers:
The report suggests that the real 'deal breakers'
for consumers will be the additional service and maintenance responsibilities
for microgeneration, water conservation and ventilation systems,
the potential lack of gas cookers and fires and the restriction
of water flow in showers. This is a crucial factor that, unless
mitigated, may affect the Government's chances of meeting its
own 2016 target.[62]
41. The Energy Saving Trust (EST) also thought
that essential features of energy efficient housing might prove
novel or difficult to accept for some consumers, and that this
would require developers and estate agents to educate potential
residents:
[…] Whilst it is possible that some of these
homes will have a traditional look, all will inevitably have design
features and functionalities that will need to be conveyed to
the householder. This may be as part of the sales process—for
example, explaining why the home without a bath is still desirable,
how to substitute children's bath time, etc.—or part of
the after-sales service—for example, explaining why a bath
or power shower should not be installed as soon as the new owner
has moved in.[63]
42. Richard Simmons from CABE, on the other hand,
referred us to innovative energy efficient flats that were proving
exceptionally popular with homebuyers.[64]
Paul King of the UK-GBC told us that low carbon homes could be
very popular, and that in fact the NHBC's report supported this
conclusion: "on closer examination the evidence in that report
sets out a much more balanced and, I would say, in some places
positively optimistic view of the benefits that people perceive
in terms of more energy efficient homes […]"[65]
43. We recommend that the Government
ensures consumers are educated about both the requirements and
benefits of highly energy efficient housing. We further recommend
that the Government work with the construction industry and bodies
such as CABE, UK-GBC, and EST, to develop designs for low and
zero carbon homes that are as easy to live in, while maintaining
the specified level of energy efficiency, as possible.
44. The Home Builders' Federation (HBF) believed
that building homes to zero carbon standards may cost around £30,000
extra per home. HBF argued that, by subsidising affordable housing
(via Section 106 payments)[66]
and public transport and other infrastructure (through the proposed
Community Infrastructure Levy),[67]
private developers were struggling with a number of burdens.[68]
The National House-Building Council echoed this: "The Government
must recognise the competing objectives in the house building
industry at present, with the Government having called for more,
more affordable, and more environmentally friendly, homes."[69]
This point was also recognised by English Partnerships (EP):
One difficulty the house builders have is meeting
the costs of achieving Code Level 6 plus affordable homes plus
EP quality standards plus Lifetime homes on the same development,
which can leave zero profit margin and possibly negative land
values.[70]
Partly as a result, EP was scaling back one of its
pilot low carbon building projects: "EP's Carbon Challenge
retains the ambition of up to ten large-scale pilot schemes. Given
the cooling market and a weakening appetite for house building
generally, we are focusing on getting developments under way on
four initial sites for the time being."[71]
45. One of the reasons given for the increased
costs of zero carbon homes was a lack of skills and capacity in
the supply chain. English Partnerships told us:
There is concern that many [small and medium-sized]
builders will not have the skills, abilities or command of their
supply chains to respond to higher levels of the Code. […]
Firstly, there is a serious issue around skills in the work force
to design, install and maintain these homes and technologies.
Secondly, the supply chain for these products needs urgent development
in the UK.[72]
Richard Simmons, chief executive of the Commission
for Architecture and the Built Environment (CABE), told us: "If
you look at Germany where they have the Passive House Standard,
for example, it is possible to add triple glazing because it is
mass produced, but in the UK so far that market does not exist."[73]
Rory Bergin, the head of sustainability and innovation at HTA
Architects, has stated:
[…F]or the size of combined heat and power system
we are planning to use at Hanham Hall, there is only one manufacturer
in the UK. So of course, it's not satisfactory having only one
supplier of a product. There's also no UK manufacturer of a low-flush
toilet, and the new [structural insulated] panels used in construction
have to be imported from Germany.[74]
46. Overall, the balance of evidence we received
was optimistic that this situation would improve over time. Rory
Bergin has stated: "I think it's inevitable […] as we
do more of this we will see more manufacturers in the UK".[75]
Richard Simmons told us, "I think we would also expect to
see the industry responding".[76]
Paul King of the UK-GBC argued that the additional costs of zero
carbon homes would come down as the scale of building increased,
and that the supply chain market was already developing: Barratt
Homes, for example, had found "that actually there were certain
technologies that were unavailable to them in terms of UK manufactured
components six months ago, which today are now available."[77]
47. Despite this confidence that additional costs
would diminish in time, there was still a consensus that zero
carbon homes would cost more to build, principally because of
the need to build or fund offsite renewable electricity sources.
John Slaughter of the Home Builders' Federation expressed concern
that the prospect of reduced fuel bills might not be enough to
outweigh the higher capital costs: "as we stand it remains
the case that consumers probably would not give that much weight
to those revenue benefits in terms of their purchase decision
and the price they are willing to pay for a home."[78]
Even more problematic, Jane Forshaw of English Partnerships suggested
that, in practice, zero carbon homes might not lead to lower fuel
bills: "There is that interesting twist that as you get higher
up the Code these homes will be much cheaper to run but the cost
of the energy infrastructure will be more, so perversely your
energy bill may not be any less because you will have to cover
the cost of the infrastructure."[79]
48. We recommend that the Government
clarifies what impacts the increased capital costs of low and
zero carbon homes will make to their running costs and how costs
will be paid for. In particular, we recommend that the Government
urgently considers introducing feed-in tariffs as a way of making
zero carbon homes more financially attractive to developers and
homebuyers.
Monitoring and enforcement
49. Increased attention on the sustainability
of new housing should go hand in hand with interest in the monitoring
and enforcement of design and construction standards. The UK Green
Building Council said, "There is no point designing a 'sustainable
home' if no checks are made to ensure this […] goal has been
met."[80]
50. Those parts of the Code for Sustainable Homes
that will become mandatory in 2010 (relating to energy use) will
be enforced by amending Part L of the building regulations, which
set out compulsory standards for most new buildings in England
and Wales. The original focus of building regulations was on the
safety and structural soundness of buildings, but this has now
been joined by regulations on energy efficiency and meeting the
needs of disabled people. Building regulations are applied and
enforced by the building control system; anyone wanting to carry
out building work that is subject to building regulations is required
by law to make sure it complies, and to obtain approval from inspectors,
either provided by the relevant local authority or by private
"approved inspectors". Breaches of building regulations
may be prosecuted by local authorities.
51. In 2005 our predecessor Committee found that
while plans for new homes were generally compliant with
building regulations, there was little evidence that the energy
efficiency standards of the regulations were being met or enforced
in practice. Evidence from the Building Research Establishment
(BRE) showed that finished buildings were often less energy efficient
than specified because of poor workmanship, in particular badly
fitted insulation. This was rarely picked up because post-completion
inspections were not always being carried out. Even where breaches
were detected, it was difficult for local authorities to mount
prosecutions, given the demands on their building control departments,
and the requirement to begin prosecution within six months of
becoming aware of a contravention.[81]
52. When we looked at this issue again in 2006,
the Environment Agency indicated that 30% of homes do not comply
with building regulations, and told us that this figure could
well be higher. The Agency also suggested that that there was
a lack of training and resources devoted to building control,
especially regarding energy efficiency. Overall, we concluded:
"It was disappointing and frustrating to find that there
had been no significant improvement in either compliance or enforcement
of the building regulations."[82]
53. In this inquiry we again heard a considerable
amount of evidence that the building regulations and control regime
was still inadequate in ensuring new homes were being built to
mandatory energy efficiency standards. CABE, for example, told
us: "The UK has been historically poor on enforcement of
both planning and building regulations, with very few prosecutions
or demolitions of significance as a result of breaches of regulations.
For example, BRE reports that many buildings are still failing
air tightness tests under part 'L' of the building regulations."[83]
The UK-Green Building Council said: "Undoubtedly compliance,
even against minimum building regulations, is currently problematic,
with high failure rates. There is no easy solution to this and
inevitably it will require institutional change in, and better
resourcing of building control departments in local authorities."[84]
The LGA expressed concern at the way in which developers were
able to 'shop around' for building control inspectors; we infer
from this the suggestion that the system is being undermined by
developers being able to choose potentially more lenient inspectors.[85]
54. Since our last report the Government has
carried out a good deal of work in this area. There are currently
reviews of both building regulations and building control, and
we will follow the progress of this work with interest. We are
pleased to note the awareness of problems with the current system
reflected in the following passage in CLG's consultation paper,
The Future of Building Control, issued in March 2008:
In particular, the Government is concerned that compliance
in areas such as energy efficiency is often perceived to be lower
than is the case for the traditional health and safety related
regulation. Stakeholders also suggest that Building Control Bodies
(BCBs) tend to focus on issues that are critical to safety (i.e.
structure and fire) at the expense of newer regulations (e.g.
those relating to sound insulation, air tightness and energy efficiency)
because of pressure on resources, a lack of understanding and
because they do not have enough up-front information about the
project. It is also true that the public tend to be more concerned
about life safety issues than energy efficiency.[86]
However, we also note the LGA's comments on the proposals
in this consultation paper:
[building control] really is in many areas, particularly
for the zero-carbon [target], the mechanism through which the
Government's policy ambition is being delivered, yet the current
consultation on building control does not seem to us to be taking
a wider view of that kind at all and only comes forward with very
modest proposals for improving the quality assurance of the building
control process largely led by the building control sector itself.[87]
Overall, irrespective of the conclusions that CLG's
reviews eventually lead to, we are very dismayed by the lack of
urgency—especially considering how vital building control
inspections will be to the entire zero carbon homes policy—shown
by the Government in addressing the weaknesses in the current
system. Bob Ledsome, Deputy Director of Climate Change and Sustainable
Development at CLG, confirmed that whatever changes to the system
as might arise from the current reviews would not be implemented
until 2010.[88]
55. We recommend that much greater
emphasis is placed on energy efficiency and sustainability within
building control, with the Government ensuring that extra training
and resources are made available to local government where necessary.
We also recommend that the Government urgently reviews ways of
improving the rigour of inspections carried out by private approved
inspectors.
56. We also note CABE's argument that the current
weaknesses in the system may become exaggerated as the standards
required of builders rise from 2010 onwards:
Reliance on regulatory systems may simply encourage
'cheating' as standards become more difficult to achieve over
the period towards carbon-neutral development. As well as the
regulatory systems of planning, building, highways and development
control, the Government should utilise a range of other instruments
and incentives to support aspirations for mitigating and adapting
to climate change in addition to [Planning Policy Statement 1
on climate change] and the Code.[89]
We recommend that the Government
introduces much higher penalties for developers who fail to meet
energy efficiency regulations in practice, and provides financial
incentives for developers based on the number of properties that
pass a post-completion site inspection.
51 Environmental Audit Committee, Sustainable Housing:
A Follow-up Report, para 15 Back
52
Environmental Audit Committee, Sustainable Housing: A Follow-up
Report, para 16 Back
53
CLG, "Code for Sustainable Homes", www.communities.gov.uk/planningandbuilding/buildingregulations/legislation/englandwales/codesustainable/ Back
54
Ev 91 Back
55
Q179 Back
56
CLG, "Quality of life, not just quantity of homes",
speech by Rt. Hon. Caroline Flint MP, 27 Feb 2008, www.communities.gov.uk/speeches/corporate/ecobuild2008
Back
57
Q195 Back
58
Sponge, Eco Geek or Eco Chic? The desirability of sustainable
homes, January 2007, para 1.1 Back
59
Sponge, Eco Geek or Eco Chic? The desirability of sustainable
homes, paras 1, 1.1 Back
60
Ev 17 Back
61
"Loophole means new houses need not be green", Green
Building, 5 May 2008 Back
62
Ev 51 Back
63
Ev 150 Back
64
Q69 Back
65
Q70 Back
66
"Planning obligations, also known as section 106 agreements,
are typically agreements between local planning authorities and
developers negotiated in the context of granting a planning consent.
They provide a means of ensuring that developers contribute towards
the infrastructure and services that local authorities believe
to be necessary to facilitate proposed developments. Contributions
may either be in cash or in kind. Planning obligations are also
used to deliver affordable housing." Department for Transport,
Local Government and the Regions (DTLR), Reforming Planning
Obligations: a consultation paper, December 2001, para 1.1 Back
67
"The Community Infrastructure Levy (CIL) will be a new charge
which local authorities in England and Wales will be empowered,
but not required, to charge on most types of new development in
their area. CIL charges will be based on simple formulae which
relate the size of the charge to the size and character of the
development paying it. The proceeds of the levy will be spent
on local and sub-regional infrastructure to support the development
of the area." CLG, Community Infrastructure Levy,
August 2008, p 2 Back
68
Ev 47 Back
69
Ev 55 Back
70
Ev 37 Back
71
Ev 37 Back
72
Ev 38 Back
73
Q64 Back
74
"Architects gear up for broader challenge", Sustainable
Business, March 2008, p 40 Back
75
"Architects gear up for broader challenge", Sustainable
Business, p 40 Back
76
Q64, Q69 Back
77
Q64 Back
78
Q95 Back
79
Q77 Back
80
Ev 18 Back
81
Environment Audit Committee, Housing: Building a Sustainable
Future, paras 113-4 Back
82
Environment Audit Committee, Sustainable Housing: A Follow-up
Report, para 41 Back
83
Ev 23 Back
84
Ev 18 Back
85
Ev 73 Back
86
CLG, The Future of Building Control, March 2008, p 31 Back
87
Q152 Back
88
Q193 Back
89
Ev 23 Back
