Green Watch, January 2022

January 2022

Green Watch Working together for a better future

Welcome to Green Watch.

Each month, Environment and Sustainability Manager, Corrina Jones shares a round-up of stories and guidance on energy efficiency and sustainable practices.

EPCs Should house prices and mortgage costs be based on EPC ratings? A new survey conducted on behalf of Foundation Home Loans suggests two thirds of current or potential homeowners would accept the idea of a mortgage interest rate based on their property's EPC rating.

The research also found 48 per cent of owners and prospective homeowners would consider work to improve a property’s EPC if that meant a more favourable mortgage rate.

Further reading: Should house prices and mortgage costs be based on EP... (estateagenttoday.co.uk)

In this month's issue:

The importance of EPC ratings amongst buyers does seem to be rising. A growing acceptance that climate change is actually happening seems to be encouraging buyers to start asking questions about the energy efficiency of a home.

EPCs Energy news Property market Retrofitting New Build Renewable energy Renewable technology Electric vehicles Regulation and policy Climate risk Climate action Climate change

A poll by Knight Frank found that 86% of respondents rated the energy efficiency of a residential property as either very important or important.

Only 3% said it had no relevance. 39% of homebuyers stated that the prospect of future environmental regulations impacting the value of their home would influence their decision to buy a more energy efficient property.

Further reading: Green homes becoming far more popular with buyers – Property Industry Eye

The average EPC rating of residential property across England is improving, but it still has some way to go. According to the findings of the English Housing Survey Headline Report, 2020-21.

In 2020, the average SAP rating of English dwellings was 66 points, up from 65 points in 2019. This still puts the average home at band D but only 3 tantalising SAP points away from a C rating.

The social sector remains more energy efficient than the private sector with 66% of homes being a band A to C compared to compared to the private rented and owneroccupied dwellings which are both at 42%.

The private rented sector showed no increase from 2020.

'Energy news

Further reading: English Housing Survey 2020 to 2021: headline report - GOV.UK (www.gov.uk)

Energy prices are going up. Ofgem will announce the new energy price cap on 7 February.

The age of a dwelling affects the energy efficiency as building techniques and regulations have changed over time, alongside wear and tear.

Almost all homes built since 2012 in England and Wales have a high energy efficiency rating, compared with just 12 per cent of assessed homes built before 1900 in England, and eight per cent of homes built before 1900 in Wales.

The price cap makes sure consumers pay a fairer price for energy and limits how much suppliers can charge you per unit of gas or electricity, based on the underlying costs. This limit isn’t on the total bill, which will vary depending on how many units of energy is used in a billing period.

It is predicted that the average household could end up paying about £700 more per year on their energy costs which could rise from an average of £1,277 to nearly £2,000 per year. In an interview on BBC, Chris O’Shea said he expected that the soaring energy prices that put pressure on suppliers and customers alike could last up to two years.

More homes will face fuel stress as energy bills rise and fuel stress is also more likely where occupiers live in poorly insulated homes. 69% of families in fuel stress live in homes with an energy performance rating F or below.

Further reading: UK households facing ‘fuel stress’ will treble to 6.3m – thinktank | Energy bills | The Guardian Gas prices are likely to stay twice as high as normal until at least 2025. Wholesale gas prices soared in the second half of 2021 amid a global shortage of supplies as demand bounced back from the worst of the pandemic and with European stocks unusually low after a cold winter.

Further reading: Gas prices could stay high for three years | Business | The Times

Insulating homes has therefore never been more important. We need to insulate our buildings well so they become more energy efficient and there’s a range of measures available for different budgets.

Not only will it make a home warmer and save money on energy bills, it’s also good for the planet and will reduce carbon emissions considerably.

A transition away from gas and an increased effort to insulate homes will help households now and in future. We need urgent investment in home and building insulation to reduce the demand for heat.

The UK no longer has any long-term gas storage so is susceptible to global gas price fluctuations.

Further reading: Insulating homes has never been more important | Centre for Sustainable Energy (cse.org.uk) Positively, the UK’s gas grid is ready for 20% hydrogen blend from next year. The 20% blend is forecast to reduce the UK’s carbon dioxide emissions, the equivalent of taking 2.5 million cars off our roads. In ‘Britain’s Hydrogen Blending Delivery Plan’ report, the Energy Networks Association (ENA) suggests all five of Britain’s gas grid companies will meet the government’s target for Britain’s network of gas pipes to be ready to deliver 20% hydrogen to homes and businesses from 2023.

Further reading: UK's gas grid ready for 20% hydrogen blend from next year - Energy Live News

Property market Mortgage Strategy argues that mortgage advisors need to place more emphasis on EPC ratings at the point of sale, enabling them to stay ahead of changing requirements and better serve clients.

EPCs must become a cornerstone of the mortgage advice process, with advisers educating clients on the benefits of EPC improvements, as well as any potential traps laying ahead.

Further reading: Blog: EPC ratings must be part of mortgage advice | Mortgage Strategy Research, carried out by BVA BDRC on behalf of Foundation Home Loans, also found that almost half – 48% – of those polled would consider improving the energy efficiency rating of their property in order to access a better mortgage product, if it paid for itself in five years.

Some 5% said they would make green improvements to their property if it paid for itself in 15 years and 24% said they plan to improve their property’s energy performance regardless. The focus on the potential allure of ‘green’ mortgages, with more competitive rates for properties with a better EPC rating, appears to be growing with homeowners now inclined to improve the energy efficiency rating of their home, particularly if such improvements might pay for themselves within a period of time.

Further reading: Homeowners would consider ‘green’ mortgages amid new energy bill warning – Property Industry Eye The Energy Efficiency Infrastructure Group (EEIG), has called for an energy saving stamp duty incentive and has delivered an open letter to the government. They are calling on the UK Government to support a longterm, revenue neutral Energy Saving Stamp Duty Incentive – to encourage homeowners to future-proof their homes against high energy bills. They believe an Energy Saving Stamp Duty would incentivise the 19 million owner occupier households to insulate their homes and install energy efficient heating systems such as heat pumps. Buyers would be charged a lower level of stamp duty for carrying out retrofit upgrades within a specified timeframe post purchase.

Further reading: COALITION LETTER TO CHANCELLOR CALLING FOR AN ENERGY SAVING STAMP DUTY INCENTIVE (theeeig.co.uk) Nat West has published its quarterly Green Homes Attitude Tracker for Q4 2021. 33% of respondents planning to purchase a property in the next 10 years said that an EPC rating was 'very important', compared to 30% in quarter three. And the importance of property location has decreased by 2% from 63% to 61%. And 63% of homeowners are planning to make improvements to the sustainability of their property in the next 10 years, an increase of 8% from last quarter.

However, there are concerns for renters with 58% of those living in rented accommodation saying neither they nor their landlords have made any energy efficiency improvements. Renters were less likely to have either double-glazed windows, energy-efficient lighting or a smart energy meter. Some 53% of renters strongly agreed that landlords should be required to ensure that the property meets certain minimum environmental sustainability standards and that rented properties should be assessed every 3 years to ensure that they meet minimum environmental sustainability standard.

Further reading: Revealed – how do landlords feel about greener home... (propertyinvestortoday.co.uk)

Retrofitting

New Build homes

We cannot leave fuel poor homes behind in the retrofit journey.

Modern Methods of Construction are gaining traction.

That’s according to a new survey by the fuel poverty charities National Energy Action (NEA) and Energy Action Scotland (EAS) which shows nearly 66% of Brits agree that it is important for policymakers to make sure that the transition does not increase the cost of living for the poorest households. In the Fuel Poverty Monitor report, the charities found that the upfront costs of low carbon technologies is a big barrier to decarbonisation for lower income families.

Construction work has started on Weston Homes’ new 137,000-sq ft modular factory in Essex. Weston subsidiary British Offsite is aiming to develop a production line that will deliver 4,000 homes a year.

Further reading: UK won't reach net zero without supporting the fuel poor, most Brits believe - Energy Live News And starting with improving insulation across our existing building stock is a priority, costs less and could benefit fuel poor homes considerably. Better insulation could save UK households more than £500 a year on energy bills, according to a group of business organisations and charities.

The Energy Efficiency Infrastructure Group is calling on the prime minister to prioritise energy saving through home improvements.

"Green home retrofits have significant social, environmental and economic co-benefits, and stand out as a 'no regrets' solution to the energy crisis, climate crisis, and levelling up agenda." said EEIG chairwoman Sarah Kostense-Winterton Further reading: Energy bills: Fix insulation to tackle cost of heating, PM told - BBC News

And could London see a growth in ‘plyscrapers’? City of London planning bosses are reportedly considering the possibilities of wooden skyscrapers, as developers look to shrink their carbon footprint by moving away from steel and concrete.

Further reading: Timber titans: City of London bosses mull wooden skyscrapers in sustainability push (cityam.com) And investment in future Net Zero is growing - PIC (Pension Insurance Corporation) has invested £130m into low carbon housing.

The Wirral Waters One (WWO) project is a 500-acre brownfield site, set to become the largest regeneration project in the UK and create 20,000 jobs. Solar power systems, heat pumps and electric vehicle (EV) charging points will be added to cut down the carbon emissions of the accommodation.

Further reading: PIC invests £130m into low carbon housing - future Net Zero However, new regulations around biodiversity gain are expected to be incorporated into the national planning policy framework and SME builders face huge costs to prove Biodiversity gain. There are definitely a lot of challenges ahead for the building sector.

Further reading: SME Builders Face Huge Costs to Prove Biodiversity Gain - Business News Wales

Renewable technology Research carried out by Solar Energy UK on behalf of the MCS Charitable Foundation has concluded that the financial benefits of installing a solar energy system on a typical home could increase its value by £1,800 and reduce annual energy bills by £300 per year or more.

This figure may even grow further as the impact of the increased energy price cap hits home.

Renewable energy Is Nuclear Power a green renewable energy source and what part will it play on the road to net zero?

MPs have approved the Nuclear Energy Financing Bill which remodels the way nuclear power stations are funded and aims to attract investors and bring more security for future large-scale nuclear power stations and end the reliance on foreign developers.

Further reading: MPs approve Nuclear Energy Financing Bill - Energy Live News And plans to build a new nuclear power plant in the UK have been backed by £100 million of government funding. That is all well and good – but how green is nuclear power?

Nuclear energy is a low carbon energy source so it will help us reach our net zero goals and can be added to the mix to minimise the risk of a future energy crisis.

Also, nuclear power is not beholden to weather patterns as some renewable energy sources are. But nuclear power uses uranium which is not a renewable energy source, and the nuclear process produces radioactive waste which is definitely not good for the environment!

UK's net zero plans set out a key role for nuclear power, but some commentators say renewables are the way to go Further reading: Government readies Sizewell C nuclear project for future investment - GOV.UK (www.gov.uk) But Alok Sharma (COP26 President) says more offshore and nuclear schemes are needed if bills are to come down so it may be a necessary interim step.

Further reading: Building more renewable energy will solve rising gas prices, COP26 president says | News | Building

A high temperature heat pump is to be rolled out in Netherlands which could directly replace natural gas boilers helping homeowners who are looking at decarbonising their homes and take climate action. In addition, the system could potentially work in UK homes. The innovative new design heat pump could be fitted without the need for new radiators and insulation (although improved insulation is always recommended to reduce energy demand and bills).

The developers say the heat pump can offer a straight swap for conventional gas boilers as it can achieve temperatures between 60-80°C (the same as most gas boilers), exceeding the 44-55°C range achieved by many conventional heat pumps.

Further reading: New Heat Pump Could Make it Cheaper and Easier to Replace Gas Boilers | Homebuilding And British Gas has launched its new heat pump offering. The company plans to start installations in the South West before the nationwide rollout and are offering interest free loans to finance the upgrades.

Further reading: Find out more about air source heat pumps - British Gas

Electric vehicles One of the big challenges a company may face in moving their fleet to EVs and encourage employee take up is range anxiety.

Government regulation and strategy The Scottish Government has announced its latest funding for green infrastructure. £8.7 million will be shared amongst eight project partners providing match funding. Projects include the construction of heat networks and installing energy efficiency measures in social housing.

Further reading: Slashing carbon emissions across Scotland - gov.scot The UK government has also announced a £60 million boost for floating offshore wind - GOV.UK (www.gov.uk).

Energy Minister Greg Hands said: “We are already a world leader in offshore wind and floating technology is key to unlocking the full potential of the seas around Britain. These innovative projects will help us expand renewable energy further and faster across the UK and help to reduce our exposure volatile global gas prices”.

The government has also launched a new programme to help develop innovative technologies to produce hydrogen, a clean energy source, from sustainable biomass and waste. Backed with £5 million in government funding.

Further reading: Hydrogen BECCS Innovation Programme - GOV.UK (www.gov.uk)

Range anxiety is a real thing when people are looking to move over to electric vehicles, but this may be resolved soon. Scientists have developed a biologically inspired membrane that could quintuple the charge capacity of electric car batteries thus massively increasing their range.

The anticipated lifespan would 10 years, and the materials used are far more abundant and are more environmentally friendly than the material used in lithium-ion batteries so it would be a win win situation!

Further reading: Battery breakthrough quintuples electric vehicle range (yahoo.com) And another challenge is ensuring the scaling up of industry to supply all the technology needed to produce EVs. The demand for EVs is expected to rise considerably in the next five years. A new EV battery factory in the Northeast has received government backing and will produce over 300,000 EV batteries a year which will start to address the issue of supply.

Further reading: Government backs Britishvolt plans for Blyth gigafactory to build electric vehicle batteries - GOV.UK (www.gov.uk) There are approximately 1.5m EV’s/Hybrids on the roads at present with 370,000 of these being zeroemission full electric. But by 2025 it is expected that EVs and HEVs will account for an estimated 30% of all vehicle sales.

Further reading: The road to electric - the UK's adoption of electric cars in charts and data | RAC Drive

Climate risk Is climate risk on your radar?

By 2045, the cost of climate change to the UK could be at least 1% of GDP. The Government has published the UK’s third Climate Change Risk Assessment (CCRA3) today. The five year risk assessment is delivered under the Climate Change Act 2008 and follows close work with the Climate Change Committee (CCC). It identifies the risks that climate change poses to multiple parts of our society and economy. For eight individual risks, economic damages could exceed £19.8 billion per year each by 2050 with a temperature rise of 2°C, with the cost of climate change to the UK rising to at least 1% of GDP by 2045.

Further reading: UK Climate Change Risk Assessment 2022 (publishing.service.gov.uk) The World Economic Forum has also published its Global Risks Perception Survey. Climate change continues to be perceived as the gravest threat to humanity. GRPS respondents’ rate “climate action failure” as the risk with potential to inflict the most damage at a global scale over the next decade.

Further reading: WEF_The_Global_Risks_Report_2022.pdf (weforum.org)

Climate action London needs to cut its emissions from vehicles by 27% by 2030 to meet net-zero ambitions. The Mayor wants to start a conversation with Londoners about how the capital gets its transport emissions down.

One idea is a clean air charge where if you don't have a clean vehicle, you'll pay a small fee to drive anywhere in London. The road pricing proposal is part of a push by Sadiq Khan to encourage people towards public transport, walking, cycling or electric vehicles. And Aviva is starting to take a strong position on climate action. It has said it will vote to try to get directors kicked out of firms that fail to make good on environmental pledges. Aviva Investors also wants bosses' pay to be linked to sustainability goals.

Further reading: Major investor will target bosses at firms failing on climate - BBC News

Climate change Global warming is causing devastating damage to property and infrastructure in the Arctic.

The region is at the forefront of global warming and temperatures are rising at a significant pace. And as the ground thaws, homes are suffering from subsidence with cracking walls, roads are buckling, and pipelines are rupturing. Experts at the BGS (British Geological Survey), the UK’s geoscientific advisor has previously warned that the number of properties in Great Britain facing subsidence issues and damage to property from rising temperatures causing shrink-swell is also on the rise, with figures of just 3% in 1990 likely to reach 10% by 2070.

Further reading: https://www.bbc.co.uk/news/science-environment59915697 The past seven years have been the hottest on record, according to new data from the EU's satellite system. The Copernicus Climate Change Service said 2021 was the fifth-warmest year, with recordbreaking heat in some regions. And the amount of warming gases in our atmosphere continued to increase. The 2021 average temperature was 1.1-1.2C above the pre-industrial level around 150 years ago.

Australia has equalled its hottest day on record after a remote coastal town reported temperatures of 50.7C (123.26F). Heatwaves are becoming more likely and more extreme because of climate change.

Further reading: Australia equals hottest day on record at 50.7C - BBC News Finally, could climate change actually threaten the future of the Winter Olympics? Milder winters are impacting on snow sports by eroding the season and forcing more dangerous, artificial conditions, experts have warned in a report published a week before the 2022 Games. The Beijing Olympics, which start on 4 February, will be the first Winter Games to use almost 100% artificial snow, relying on more than 100 snow generators and 300 snow-cannons working flat-out to cover the ski slopes..

Further discussions We welcome the opportunity to discuss with you the challenges you are facing and explore the ways in which we could support you to overcome them. If you would like to arrange a meeting to discuss any of the indicatives featured in this update, please email Corrina Jones at corrina.jones@esurv.co.uk.