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Local government and the path to net zero Contents

Conclusions and recommendations

A net zero framework for local government

1.Given how significant is local government’s influence over greenhouse gas emissions, it is clear the UK will struggle to reach net zero by 2050 unless central and local government work together to deliver solutions tailored to meet local circumstances. (Paragraph 25)

2.Local authorities will be particularly important in ensuring a just transition to net zero, since no layer of government is closer to people or better able to tailor climate action to meet the needs of local communities. Only by harnessing local government can central government deliver a just transition that benefits all communities. Without that just transition, the Government will struggle to persuade the public to make the necessary changes. (Paragraph 26)

3.We welcome the ambitious targets set by many local authorities, and we are pleased the Government has now committed in its Net Zero Strategy to clarifying the relationship between central and local government in the delivery of net zero and to improving co-ordination between different layers of government. It remains to be seen, however, if this will amount to the comprehensive delivery framework called for by the Climate Change Committee. We also recommend that any framework strike a careful balance between clarifying the expectations on local authorities and leaving them free to determine what climate action is most appropriate in their areas. (Paragraph 27)

4.We note that the Net Zero Strategy assigns responsibility for co-ordinating with local government to the Department for Business, Energy and Industrial Strategy and that the role of the Department for Levelling Up, Housing and Communities remains undefined. (Paragraph 28)

5.On funding, we welcome the commitment in the Net Zero Strategy to explore ways to simplify and consolidate the number of local net zero funding streams, but we note it included no clear commitment to increasing the level of long-term funding specifically for local authority climate action. (Paragraph 29)

6.In line with the recommendation from the Climate Change Committee, and seemingly in line with its own commitment in the Net Zero Strategy, we urge the Government to immediately begin consulting local government on the contents of a draft net zero delivery framework setting out the relative roles and responsibilities of local and central government. The framework should also clarify the critical role local government must play in delivering a just transition that benefits all communities. The Government should also consult local government on what additional powers it might need to meet its climate targets. (Paragraph 30)

7.Either in that framework, or elsewhere, the Government should also clarify what role, if any, the Department for Levelling Up, Housing and Communities will play in supporting local authority climate action, given that the Department for Business, Energy and Industrial Strategy is now responsible for co-ordinating with local government in this area. (Paragraph 31)

8.We also recommend that the Government come up with a plan for funding local authority climate action in a way that gives councils the confidence and ability to plan for the long term, including by making good on its commitment in the Net Zero Strategy to simplify and consolidate the number of local net zero funding streams. (Paragraph 32)

Homes

9.Reaching net zero requires ensuring that new homes are designed and built in a way that will avoid subsequent retrofitting and are built to net zero standards. This will also avoid the cost of ensuring higher standards being borne by the people living in the property, rather than being met by the developer. There needs to be certainty about the details of the Future Homes Standard as soon as possible to ensure the 2025 target is met. The technical consultation on the Future Homes Standard should take place in 2022 rather than 2023, thereby enabling the relevant legislation to be brought forward as soon as possible to ensure greater certainty for suppliers and developers. The Government should consider setting a further target of moving to zero carbon homes by 2030. (Paragraph 41)

10.The Government anticipates that only 200,000 heat pumps a year will be fitted into new homes by 2028. As the Government’s target is to build 300,000 homes a year by the mid-2020s, it should explain where the additional heat pumps and other low-carbon heating systems will come from to meet the demand of all 300,000 new homes. (Paragraph 42)

11.The public need to have confidence that homes stated to be net zero are as promised. Therefore, the Government should review the metrics used to measure energy efficiency in homes. This should include considering how energy performance certificates are calculated, how embedded carbon could be better incorporated into the calculations of the carbon emissions of properties, and how the in-use performance of properties can be accurately measured. The Government should introduce measures to close the performance gap, including post-occupancy evaluations, which assess whether the actual energy output of new properties meet the standards promised by the developers once they are being lived in. This is particularly important as evidence indicates that new homes can lose 50% more heat than expected. (Paragraph 44)

12.The Department for Levelling Up, Housing and Communities should ensure that future reforms to the planning system give a larger role to sustainability than is the case in the current planning system. We welcome the Government’s commitment to reviewing the National Planning Policy Framework to ensure it contributes to climate action, but the Net Zero and Heating and Buildings strategies could have said more about the ability of local authorities to use the planning system to shape their communities in ways that reduce carbon emissions. We agree with local authorities continuing to be able to set their own, more extensive, energy efficiency standards for new housing developments. To support making new housing carbon neutral, net zero should be given a central role in the National Planning Policy Framework. This can and should be compatible with the Government’s target to deliver 300,000 new homes a year by the mid-2020s. Net zero should also be embedded in the new national design code and local design codes. Furthermore, local authorities should be given the ability to include tougher standards in Local Plans as unconditional requirements for all developments. The proposal in the Planning White Paper for local authorities to have a statutory responsibility to produce a Local Plan should also include a requirement that the Local Plan specifically addresses the issue of carbon emissions and how the local authority will ensure developments in their area contribute towards achieving net zero. This will enable local authorities to take a strategic approach about how to foster developments that will help reduce carbon emissions. To ensure that planning authorities have the necessary skills to devise and monitor effective decarbonisation policies we reiterate the recommendation from our recent planning report for £500 million to be invested over four years into funding the planning system. (Paragraph 51)

13.The retrofitting of existing homes is essential for ensuring the UK reaches net zero by 2050. Retrofitting will come at substantial cost and can only be achieved through a mix of both public and private funding. We welcome the additional £3.9 billion of funding being provided for retrofitting as outlined in the Government’s Heat and Buildings Strategy, including for public sector buildings, social housing, and low-income families. But more needs to be done to provide long-term certainty for funding for retrofitting beyond 2025. The Government should set out its longer-term funding plans beyond 2025, and outline the share of funding for retrofitting it anticipates will come from private investment. The use of private sector financial instruments should be encouraged and incentivised by government. This should include greater action by the UK Infrastructure Bank to support private financing of retrofitting, following the example of the German national infrastructure bank. We note the Government’s proposal to encourage green mortgages, and this should be subject to extensive consultation to avoid unintended consequences. The Government should also consider offering tax incentives, which could include lower VAT, stamp duty and council tax, for energy efficient measures and homes. (Paragraph 69)

14.The Green Homes Grant voucher scheme proved a disappointing failure, and it is important that the reasons for its failure–that it was created too quickly, had high management and administration costs, and did not last long enough–should shape future schemes. Above all both the voucher scheme and the previous Green Deal failed to achieve the expected level of take up by the public. These repeated failures make it essential that future schemes are a success and that all relevant government departments, including the Treasury, alter their approach accordingly. Although the funding delivered through the Boiler Upgrade Scheme is welcome, we note that the scheme will only fund at most 90,000 additional heat pumps, and there is seemingly no role for local authorities in the delivery of the scheme. The effectiveness of the scheme should be monitored closely to ensure its successful contribution to retrofitting of homes. (Paragraph 70)

15.Future retrofitting schemes will be needed to incentivise the public to switch to low carbon heating. Such schemes should be put in place after a thorough consultation with stakeholders, including with the public. We believe the following five principles would provide a solid foundation for future schemes:

16.The Government is proposing that certain properties with low EPC Bands and using electricity and LPG gas will need to choose a low-carbon heating system when replacing their existing one from 2026. This contrasts with the same requirement on replacing heating systems only applying to homes that are on the gas grid from 2035. The Government should explain the rationale for these different approaches. The lack of a requirement to replace a gas boiler that has ceased working with a low-carbon heating system until 2035 risks a large number of existing gas boilers simply being replaced with new gas boilers, especially given that there is a lack of incentives to do otherwise. Furthermore, the Government should set out its plans for properties that cannot be retrofitted. (Paragraph 72)

17.The Climate Assembly UK emphasised the importance of giving the public choice over how retrofitting takes place, including over which technologies are installed. Choice is important in securing public support for retrofitting. Local authorities can play an important role in supporting retrofitting in their local area, by assisting with organisation, advice, promotion and consultation with communities. The Government must ensure there is as much choice for the public in deciding how their homes are retrofitted as is technologically possible. There is therefore a need for progress on developing alternatives to heat pumps, including hydrogen heating. Local authorities should be given the necessary support and resources to fulfil their important role in retrofitting. (Paragraph 77)

18.We were told that local government needs additional resources to enforce minimum energy efficiency standards in the private rented sector. Resources should be made available for this purpose. Enforcement would also be aided by the introduction of a register of landlords, as already undertaken in certain local authorities, and we are pleased to hear the Government is considering this as an option. This register must be compulsory and local authorities must have enforcement powers to ensure registration. (Paragraph 79)

The wider role of local government

19.As previously stated, we welcome the Government’s commitment to reviewing the National Planning Policy Framework to make sure it contributes to climate mitigation, but we are concerned that in the meantime some councils will continue to grant planning permission to development that locks people into car dependency. In the short term, the Government should clarify the need for sustainable transport and placemaking to be embedded in all new development. In the longer term, it should amend the NPPF to require all housing development to be properly serviced by public transport and active travel networks and be within walking distance of local shops and amenities. As far as possible, all employment areas should also be served by public transport. To facilitate this, the Government should reiterate to local councils the importance of having up-to-date Local Plans and, in line with our earlier recommendation, require councils to embed sustainability in those plans. (Paragraph 87)

20.We welcome the ambition in the recent national bus strategy to increase bus usage and ensure cheaper and more reliable bus services across the country. In particular, we welcome its promise to give local authorities more control over bus services, either by agreeing Enhanced Partnerships with bus operators or by seeking franchising powers like those enjoyed by Transport for London. It must be acknowledged, however, that franchising will be expensive. We also commend the Department for Transport’s proposals for encouraging demand-responsive services in rural areas and its provision of additional funding through the Rural Mobility Fund. We are concerned, however, that this will not be enough to achieve the Government’s aim of ensuring high-quality services everywhere. We note, too, that the Rural Mobility Fund was allocated through a process of competitive bidding. As we have already noted, it is difficult for local authorities to plan for the long term on the basis of funds allocated through competitive bidding. We also note that the transport decarbonisation plan barely mentions the role of light rail in the future of public transport. (Paragraph 95)

21.We urge the Government to make good on the welcome promises set out in the national bus strategy, in particular to give local authorities more control over bus services, and to explain as soon as possible how it plans to make sure local authorities have the necessary funding to provide high-quality public transport services in rural areas. We also ask the Government to give greater consideration to the important role light rail can play in the public transport network. (Paragraph 96)

22.We are pleased the Government has promised to empower local authorities to take bold decisions in this area and to publish a toolkit of guidance and information to help local authorities develop innovative and sustainable transport policies. We also welcome its commitment to investing £2 billion over five years in active travel, most of which will be channelled through local authorities, but we are concerned that this might not be enough. Funding should be more consistent and reliable and not dependent on competitive bidding processes, which tend to benefit the larger and better resourced councils and lead to wasted resources on unsuccessful bids. We recommend that funding for active travel be put on a more consistent footing and that the Government work more closely with local authorities to support and monitor their activities. (Paragraph 103)

23.Local authorities are well placed to support the decarbonisation of energy generation and supply through the delivery of smart local energy systems, owing to their role as planning authority and knowledge of their local areas. It is also clear that many councils are taking advantage of their position to deliver exciting and innovative energy systems. We welcome the fact that much of this innovation is being part funded by central government, but we are concerned that some councils might lack the expertise and resources needed both to take advantage of this funding and to identify opportunities for low-carbon energy systems in their area. We are pleased, however, that the Government has recognised this lack of capacity in its Heat and Buildings Strategy and promised to better support local authorities. We are also pleased it has now launched a consultation on proposals for heat network zoning and that this will consider the role of local authorities in their delivery. (Paragraph 111)

24.In line with its commitment in the Heat and Buildings Strategy, we urge the Government to immediately consult local authorities on how it can better support them to take advantage of the funding available for other types of low-carbon smart local energy systems. (Paragraph 112)

25.Besides buildings, transport and energy, there are many areas where local government can make a profound contribution to the UK meeting its net-zero target. We have highlighted waste management, procurement and local leadership, but there are many more besides. It is the responsibility of central government, in partnership with local government, to enumerate every area where local authorities can take climate action. It is also the responsibility of central government to make sure local government is properly funded to take climate action. (Paragraph 125)

26.As already recommended, the Government must immediately consult local government on the contents of a draft net zero delivery framework setting out the relative roles and responsibilities of local and central government. It must also commit to properly funding local authority climate action and provide assurance that the UK Shared Prosperity Fund will be able to fund schemes of the kind currently funded through the European Regional Development Fund. (Paragraph 126)



Published: 29 October 2021 Site information    Accessibility statement