Housing Specification Blog

Tackling energy efficiency in the private rented sector

September 13, 2012 Alexandra Blakeman Housing Issues

Today Housing Specification welcome Tom Cox from St-Gobain Isover to the blog. Here he informs us about the challenges of dealing with energy efficiency requirements in the private rented sector.

According to the English Housing Survey – Homes Report 2010, published in July by Communities & Local Government, the private rented sector had the highest proportion of dwellings that could benefit from low cost energy efficiency measures.

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The study showed 40 per cent of all private rented dwellings with lofts and 89 per cent with cavity walls could benefit from insulating them.  Despite this, only a relatively small number of landlords have made energy improvements to their properties.

Let’s look at some more figures:

  •  The UK Government has pledged to reduce carbon emissions by at least 80 per cent by 2050, relative to 1990 levels
  • Existing homes are responsible for 27 per cent of the UK’s carbon emissions
  • Around 85 per cent of today’s homes are expected to still be in use in 2050
  • The private rented homes sector is growing and currently comprises around 14 per cent of all UK household

New legislation has been introduced under the Energy Act 2011 which will make it unlawful to let properties with energy efficiency ratings of F or G.  However, this doesn’t come into force until 2018 and I believe we need to act now to encourage the uptake of energy efficient measures by landlords if the UK is to meet its ambitious carbon reduction targets.

Over 25 per cent of premises rated for energy efficiency over the last four years fall into the F or G energy efficiency categories and these aren’t just older properties, as some homes built as recently as 2005 have been shown to be ‘unmarketable’ under the act.

By upgrading properties sooner rather than later landlords will help to protect tenants against future rises in energy costs.  The Green Deal, which launches this October, will enable landlords to carry out these energy efficiency improvements at no upfront cost.  Tenants will then pay the loan back over time, with the ‘Golden Rule’ minimising any impact on them by ensuring they will never pay back more than the amount they are saving on fuel bills each month.

With predictions that energy bills will soar by 70 per cent to an average of £2,200 by 2020, the payback time for Green Deal improvements is likely to decrease significantly.  When the loan has been paid off, tenants will feel the benefit of reduced fuel bills and landlords with the most energy efficient properties will be able to command higher rental prices, increasing the value of their portfolio while also playing a key role in reducing the UK’s carbon emissions from existing homes.

Tom Cox, Innovation and Product Manager for Saint-Gobain Isover

 

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