Documents considered by the Committee on 22 November 2017 Contents

8Energy Performance of Buildings

Committee’s assessment

Politically important

Committee’s decision

Not cleared from scrutiny; further information requested

Document details

Proposal for a Directive amending Directive 2010/31/EU on the energy performance of buildings

Legal base

Article 194(2) TFEU

Department

Communities and Local Government

Document Number

(38339), 15108/16 + ADDs 1–5, COM(16) 765

Summary and Committee’s conclusions

8.1The building sector is the largest single energy consumer in Europe, absorbing 40% of final energy. About 75% of buildings are energy inefficient according to the European Commission, yet only around 1% of the building stock is renovated each year.

8.2In order to accelerate the cost-effective renovation of the existing building stock, the Commission proposed in December 2016 to update the existing Energy Performance of Buildings Directive (EPBD) by:

8.3Since the previous Committee considered the proposal on 31 January 2017, Ministers have written on two occasions, including notification that the Government overrode the scrutiny reserve in order to support a General Approach at the June Energy Council. The Minister of State for Housing and Planning (Alok Sharma) explains in his letter of 9 October that the Government took a position at Council because the Committee had not been reappointed.

8.4In an earlier letter of 21 June, the Secretary of State for Communities and Local Government (Sajid Javid) had summarised progress, noting that agreement was likely at the Council and attaching a helpful summary of the compromise. The Secretary of State indicated that the compromise proposals were more proportionate than the original proposals and drew particular attention to the changes negotiated on electric vehicle charging infrastructure.

8.5The Commission originally proposed that, for new non-residential buildings and for non-residential buildings undergoing major renovation, one parking space per ten should be equipped for electric vehicle recharging. The Council agreed that only one space in any non-residential building would need to be for electric vehicle charging, while one in three parking spaces would need to have ducting infrastructure (a conduit for electric cabling). For new and renovated residential buildings, ducting is required for every parking space, but not pre-cabling as originally proposed. The Secretary of State estimated that the net benefit of the electric vehicle charging aspect of the proposal, as amended by the compromise, would be around £460 million.

8.6Beyond electric vehicle charging, many of the other changes addressed concerns highlighted to us by the Government in its original position, simplifying the provisions on Energy Performance Certificates and the proposed voluntary “smartness indicator”.40

8.7While we accept that it was not possible for the Government to secure scrutiny clearance before the Committee had been formed, we note that the Government did not respond to our predecessor’s Report of 31 January 2017 until 21 June 2017. Our predecessors met until 25 April and would thus have had ample opportunity to consider information from the Government at an earlier stage, and may even have been able to waive the proposal from scrutiny. Other Departments were able to make such requests between the announcement of the General Election and the dissolution of Parliament. We would welcome an explanation as to why the Government did not communicate with our predecessors at an earlier stage.

8.8We note that—even with the transposition from period extended from 12 months to 24 months—it is likely that the transposition deadline will fall during the post-Brexit “Implementation period”. We would welcome confirmation as to whether the Government would expect to transpose the measure into UK law.

8.9On the substance, we note the Government’s particular satisfaction with the changes negotiated on electric vehicle charging, ensuring that the requirements are less onerous than originally proposed. Indeed, the Government believes that the benefits will far outweigh the costs, with a net benefit of £460 million. The Government’s recent Green Growth Strategy acknowledged the need to accelerate the shift to low carbon transport and set the aspiration to develop “one of the best electric vehicle charging networks in the world”. As that document did not give any detail on electric vehicle charging provision in buildings, it would be helpful—in understanding the Government’s approach to the negotiations—if the Government could set out its position on how new and renovated building stock can contribute to the low carbon transport shift.

8.10We understand that the Estonian Presidency is seeking to conclude negotiations with the European Parliament (EP) by the end of the year. We are aware that the Council and EP are largely aligned on their approach to electric vehicle charging infrastructure, but that the EP has proposed a range of ambitious amendments in other areas. We look forward to an update on the progress of those discussions. The proposal remains under scrutiny.

Full details of the documents

Proposal for a Directive amending Directive 2010/31/EU on the energy performance of buildings: (38339), 15108/16 + ADDs 1–5, COM(16) 765.

Background

8.11Details of the proposal—and of the other elements of the Clean Energy Package—were set out in our Report of 25 January 2017.41

8.12In its original Explanatory Memorandum,42 the Government highlighted a range of concerns relating to the proposal, notably the potential additional cost of some of the suggested changes. The previous Committee asked that the Government supply further details of its analysis once further progress had been made.

8.13As set out below, the Government has written with details of developments and its analysis of those developments. More recently, the European Parliament adopted its negotiating position. On electric vehicle infrastructure, its position is largely in line with that of the Council. In other areas, though, it has taken an approach which would apply more obligations on Member States than proposed by the Commission: new buildings would need to be equipped with self-regulating devices to regulate the room temperature in each room; more residential buildings would be required to undergo the inspections regime for air-conditioning and ventilation systems; more residential buildings would be subject to the inspections regime for their heating system; and building automation and control systems would become a requirement by 2023 in all non-residential buildings with an annual energy consumption of over 250 MWh (megawatts per hour).43

The Secretary of State’s letter of 21 June 2017

8.14The Secretary of State wrote to inform the Committee that the Maltese Presidency was seeking to agree a general approach at the Energy Council meeting on 26 June and to outline the intended Government position. He noted that the proposal was still under scrutiny and he acknowledged that the Committee was unlikely to be reappointed in time to consider the proposal before the Council meeting.

8.15The Secretary of State emphasised that the Government’s aim was to ensure that the agreed provisions are proportionate, practical and cost effective and in line with UK policy. He explained that other Member States had raised similar concerns to those of the UK and that welcome revisions had been made:

“The compromise proposals offer greater flexibility to Member States and are more proportionate than the original proposals. In particular, the requirements on electric vehicle charging infrastructure have been revised to make them more practical and cost effective to implement.”

8.16He observed that the implementation deadline had been changed from 12 months to 24 months following the date of entry into force.

8.17The Secretary of State attached a summary of the Presidency’s latest compromise changes to the proposals and their impacts as well as a copy of the text on which the Presidency would be seeking a General Approach.44

8.18A full copy of the Government’s summary and analysis is available online.45 In relation to electric vehicle charging infrastructure specifically, he estimated that the new additional cost on business for complying with the proposals would be around £90 million per annum. He noted, however, that there are already some planning policies in place—such as the London Plan—which go beyond the requirements. Taking into account potential benefits, he estimated that the net financial benefits from the proposal would amount to £460 million. Further analysis would be carried out as part of any Impact Assessment required for the implementation of the changes to the Directive.

The Minister’s letter of 9 October 2017

8.19The Minister explains that, as the proposal was still under scrutiny when Parliament was dissolved and the Committee was not reappointed in time to consider the proposal before the Council meeting, the Government adopted a UK negotiating position at the Energy Council without scrutiny clearance. The UK position was to ensure that that the proposal was proportionate, practical and cost effective and in line with UK policy.

8.20Along with a number of other Member States, the UK felt that the right balance had been reached and the text was adopted as proposed by the Maltese Presidency.

8.21The Minister attaches a “checklist for analysis on EU proposals”,46 which largely reproduces the content of the summary and analysis attached to the earlier letter from the Secretary of State.

Previous Committee Reports

Twenty-ninth Report HC 71–xxvii (2016–17), chapter 1 (25 January 2017).


40 Originally proposed by the Commission as mandatory, this would be used to measure buildings’ capacity to use digital and electronic systems to optimise operation and interact with the grid.

41 Twenty-ninth Report HC 71–xxvii (2016–17), chapter 1 (25 January 2017).

42 Explanatory Memorandum from the Department for Communities and Local Government dated 20 December 2016.

43 European Parliament Think Tank Briefing, Energy Performance of Buildings, 10 November 2017.

44 General Approach, 10288/17.

45 Letter from the Secretary of State dated 21 June 2017.




28 November 2017