Housing Industry Leaders Issue 10

How £100 Million Will Deliver 10,000 Sustainable Homes

in Wales

Page 16

Also in this issue: How the Crown Estate Will Trial Zero Carbon Homes

Your TSM Standard Questions Answered

Housing Industry Leaders Examines the Biggest Changes in The Sector This Month

Throughout the UK, the housing sector is embracing change as the nation strives to deliver adequate, safe, and comfortable housing that is increasingly aligning itself with the UKs net zero and retrofit targets. Housing Industry Leaders delves into what steps are being taken to meet these goals, and what impact this is having on housebuilders and tenants alike.

In this issue, Housing Industry Leaders explores the unspent developer funds that could be better utilised, how £100 million will deliver 10,000 homes across south Wales, and unpacks this month’s biggest public sector announcements.

While highlighting the specific successes and challenges of the social housing sector, Housing Industry Leaders brings the most topical discussions and debates about the future of the housing industry to the forefront.

Hannah Wintle h.wintle@peloton-events.co.uk

Our latest podcast highlights how Wales is winning the decarbonisation race in the UK.

How the Crown Estate Will Trial Zero Carbon Homes

by Hannah WIntle

Two pilot housing projects launched by The Crown Estate will test different approaches to building net zero homes. Housing Industry Leaders spoke to Rob Chesworth, Head of Regional Residential at The Crown Estate, to ascertain how these pilots will explore and share best practice in the sector.

The Crown Estate’s history dates back to 1760, though it operates today under the Crown Estate Act of 1961. It is not privately owned by King Charles III or the government, but is instead managed by a board, with its net profit given to HM Treasury for the benefit of the nation’s finances.

With a purpose to ‘create lasting and shared prosperity for the nation’, it is unsurprising that their attention should turn to delivering housing using less than 300kg/m2 of embodied carbon.

Through the projects, the opportunities and challenges faced when delivering industry-leading net zero housing will be explored, with an aim to draw on best practice and encourage innovation.

Their 15-acre site at Wootton, Bedford has a Neighbourhood Plan allocation for 50 homes, 30% of which will be affordable. Another site in Knutsford, Cheshire, will see 60 homes built, 30% affordable, as well as tackling an additional challenge of delivering low-carbon associated road infrastructure.

Rob said: “We’re really looking to understand the barriers and opportunities to delivering ambitious environmental standards, so that when we get to projects of greater scale, delivered in phases with significant infrastructure requirements, we have a better understanding of what innovation and technology is required.”

It is hoped that these two sites will be viewed as exemplar projects that both inform The Crown Estate’s own pipeline, but also the market at large

The goal is to learn and build upon best practice

As The Crown Estate explores potential partnerships in delivering these projects, they are calling on those who understand the best practice within the industry to deliver on the brief of less than 300kg/m2 of embodied carbon.

In addition, prospective partners are asked to evidence how their proposals meet other hypotheses relating to building materials, innovation, as well as how Passivhaus, circular economy, and regenerative principles will be embraced.

Within the brief, Rob explained: “There were a series of fairly detailed hypotheses, but more to guide respondents rather than to be prescriptive about how we want them to respond.

“And so, for example, if we get a green concrete solution and we get a timber solution, that’s okay. We want to evaluate both of those, both compliant bids and noncompliant bids so that we see a broad range of perspectives and we understand what the art of the possible is.”

The lessons learned throughout this procurement process is likely to form the basis of The Crown Estate’s decisions going forward, too.

Ultimately, it is hoped that these two sites will be viewed as exemplar projects that both inform The Crown Estate’s own pipeline, but also the market at large.

As such, being as transparent as possible throughout the project is vital in the endeavour to share lessons learned throughout the process, which Rob insisted is the right thing to do for the wider market.

Affordable housing is high on The Crown Estate’s agenda

In trialling different approaches to building net zero carbon homes, The Crown Estate has also acknowledged the importance of delivering affordable homes.

Energy efficiency in these cases is paramount when it comes to tackling fuel poverty and keeping costs down amid the current cost of living crisis, something that goes hand-in-hand when aiming to minimise operational and embodied carbon.

Rob emphasised that low energy bills is an integral part of the mission to deliver these homes: “The point of the demonstration projects is to test the

specific purpose, which is really, ‘what do leading environmental standards look like?’ I would anticipate that including low or zero bills, and I would want that to extend to the affordable and not just the market provision.

“I also don’t mind saying that that’s an ambition that carries through to the rest of our business. The Crown Estate wants to provide affordable housing. We want to deliver net zero homes. And we want those zero homes to be affordable in the broadest sense.

“We’re acutely aware of the cost of living crisis, and creating prosperity in the regions that we operate in is one of the Crown Estates strategic objectives.”

The Crown Estate wants to provide affordable housing. We want to deliver net zero homes. And we want those zero homes to be affordable in the broadest sense

Incentives are in place to achieve environmental and financial outcomes

In order to attract the right type of participants –those with a clear will to deliver against the outlined brief and accompanying hypotheses – certain incentives and penalties have been put in place. Partners will be awarded with such incentives for delivering against the carbon target of 300kg/m2 of embodied carbon, as long as it can be demonstrated objectively and monitored afterwards. The Crown Estate remains amenable to alternatives to the approach and practices they have recommended. Additionally, while Rob assured that nobody is precluded from participating in these projects, there is a particular enthusiasm to work with SMEs.

“We wanted to work with SMEs who are well invested and thoughtful around innovation and entrepreneurship and around net zero homes and community participation,” he said.

“It was important, therefore, that we had a commercial structure that supported those types of participants, and we basically get the broadest possible pool of respondents from the market.”

The Crown Estate’s vast £16 billion portfolio comprises of agricultural land, urban centres, development opportunities, and much of the English seabed, meaning they facilitate the use of the coastline for offshore wind development.

Their efforts to facilitate the wider UK in meeting its climate targets are founded upon their core principle to work in favour of the nation. As the public and private sectors accelerate towards delivering net zero, The Crown Estate is uniquely positioned to aid this endeavour and, through demonstration projects such as these, contribute to the ongoing efforts to reach 2050.

Section 106 Agreements, Unspent Developer Contributions and How to Change it

by Floyd March

In what has been a surprise for many in the housing sector, HBF research conducted through an FOI request revealed eye-watering levels of unspent developer contributions that came through Section 106 Agreements.

From a sample of 171 local councils who provided data following a Freedom of Information request, more than £1.4 billion remains unspent, including over £280 million specifically earmarked to provide much-needed affordable housing for residents.

As part of the process of securing planning permission, developers are required to make contributions to local authorities under the Section 106 Agreement. These contributions mitigate the impact of development by providing additional Affordable Homes at below market value, enhancing infrastructure, and providing public goods.

The report explained that this can include education facilities such as new schools, road upgrades, public transport improvements, community facilities, open spaces, nature reserves and health facilities.

One of the biggest contributions from a housing

perspective is the inclusion of affordable housing within these contributions. The report expanded on this: “Over recent years, the proportion of new Affordable Homes provided through Section 106 either directly or indirectly has grown to around 50%. For Social Rented homes the proportion is even greater than half.”

Section 106 and developer contributions were designed to ensure local communities experience the benefits that development brings into the area. This research, however: “Demonstrates that across the country a lack of capacity or unwillingness to spend developer contributions is preventing communities from realising the benefits that have been paid for by builders.”

“This, in turn, has inevitable consequences for communities’ perceptions of development and the wider narrative around and perception of home builders.”

Unspent affordable housing contributions in major cities

It would be acceptable to think that smaller authorities may be the most likely to have unspent funds, with smaller space for development, other priorities etc, but the FOI conducted by the HBF found that major cities have significant unspent contributions within larger authorities.

“Our research shows that local authorities in major cities with communities at the sharp end of the housing crisis are holding the greatest sums of monies that have been allocated for affordable housing.”

Five of the 9 councils with the highest amounts of unspent affordable housing contributions are in London, with Leeds, Oxford and Newcastle City Councils also among the top 10.

The Royal Borough of Kensington and Chelsea (RBKC) holds more in funds allocated for affordable housing than any other council which responded, with over £20m unspent. Outside of London, Leeds City Council holds the most amount of money allocated for affordable housing (£17m).

The FOI specifically asked: “How much money received via S106 agreements is held, unspent, by the local planning authority? How much of this figure is specifically earmarked for (a) affordable housing provision, (b) highway improvements, (c) education contributions, (d) social infrastructure, e) healthcare services and (f) other?’

Total unspent S106 contributions held by planning authority respondents in England and Wales totalled £1,405,787,653.522. On top of this, the average unspent S106 contributions held by councils that responded equalled £8.2M.

Extrapolation of these figures to account for the 50% of councils that did not respond to the request allows us to estimate that across England and Wales, there is likely to be as much as £2.8bn in unspent Section 106 monies provided by home builders to mitigate the impact of development and provide community benefits to accompany the new homes provided.

Extrapolating these findings out across local government suggests that almost £2.8bn in contributions from the private sector are unspent.

The top 10 LAs who held the most unspent S106 contributions were:

1. South Gloucestershire Council: £58.2m

2. Leeds City Council: £57.9m

3. London Borough of Greenwich: £57.2m

4. London Borough of Lambeth: £49.9m

5. Royal Borough of Kensington and Chelsea: £44.0m

6. Rushcliffe Borough Council: £42.2m

7. London Borough of Hammersmith and Fulham: £39.6m

8. Newcastle City Council: £31.9m

9. Test Valley Borough Council: £27.9m

10. Bracknell Forest Council: £27.7m

The top ten councils collectively hold over £436M in unspent S106 contributions from developers.

From the list above, the FOI found that South Gloucestershire Council holds the most unspent contributions. However, Thornbury and Yate MP Luke Hall has stated that: “South Gloucestershire does not have the infrastructure to accommodate thousands more houses at the expense of our local infrastructure.”

The HBF added: “It is important that developers’ financial contributions are spent according to their negotiated purpose and within their agreed time limit so that strain on local infrastructure is not blamed unfairly on local developers.”

Contributions for affordable housing underutilised to the sum of £283m

The average unspent affordable housing contributions per LA who responded equalled around £1.7m. Additionally, the total unspent affordable housing contributions in England and Wales if scaling up to all LAs would hit an eye-watering £566.6m, according to the HBFs calculations.

The top 5 LAs with the largest amount of unspent affordable housing contributions were:

1. Royal Borough of Kensington & Chelsea: £20.4m

2. Leeds City Council: £17.2m

3. Oxford City Council: £12.3m

4. London Borough of Greenwich: £10.8m

5. Shropshire Council: £9.8m

In recent years, the output of affordable housing in England has been increasingly reliant on S106 and CIL contributions from developers over other sources of funding, such as the Affordable Homes Programme.

Between 2019 and 2022, almost 50% of new Affordable Homes completed in England were delivered as a result of S106 contributions obtained through private-led developments. Section 106 agreements also build support for new developments among local communities by funding vital infrastructure.

Conclusions and recommendations make for interesting reading

The HBF further added: “We know from research commissioned by the Government that over time the focus of S106 contributions has moved away from other infrastructure and services towards Affordable Housing. This is likely to be the result of a reduction in government grant funding for Affordable Housing Programmes.”

“It is therefore especially worrying that payments made to councils to provide services and infrastructure are not feeding through to new provision for the enjoyment and utility of new and existing communities, potentially leaving residents unsure of the benefits that development has brought to their area.”

“However, the supply of new homes is now under threat from the Government’s broader antidevelopment approach, with the Government abandoning mandatory housing targets and removing the requirements around five-year land supply.”

Alongside interventions by Natural England on water and nutrient neutrality, as well as a growing burden of new levies, regulations and taxes, the housing supply could now fall to the lowest levels since World War Two. This will have a knockon impact on the S106 contributions that local authorities will receive and are therefore able to spend on affordable housing and other important community services, such as education provision, and the number of people subsequently employed in local areas.

Further conclusions and recommendations include: “Developers’ financial contributions should be spent according to their negotiated purpose and within their agreed time limit, rather than returned to developers or left unspent.”

The HBF indicated that Local Authorities should be compelled to publish an easily digestible summary of their annual reports on their website, which includes details of how money from developers is being spent – or why it is not being spent.

“This would improve public transparency of this process. This information is not always clear from Infrastructure Funding Statements currently published by councils.”

A final message for those working in the housing sector was that: “A new badging scheme through which infrastructure and new facilities supported by S106 contributions, either directly or indirectly, could be easily identifiable to communities would also help public understanding of such provision and create a more informed, sensible debate about housing supply.”

Home builders are not advocating refunds of S106 payments. Instead, the industry is concerned that the inaction or lack of capacity from councils, along with fiery rhetoric about development and developers from politicians, is contributing to negative perceptions of home building across the country.”

Your TSM Standard Questions Answered

by Floyd March

With the Tenant Satisfaction Measure Standard coming into effect nearly six months ago, Housing Industry Leaders Highlights the key questions that were submitted to the government since the introduction.

New rules require all registered providers to generate and report TSMs as specified by the regulator in two documents. Those being TSM Technical Requirements (‘technical requirements’) and TSM Tenant Survey Requirements (‘survey requirements’).

The final version of these TSM requirements was published in September 2022, alongside the TSM Standard. They contain significant information as to how TSMs must be defined, calculated, and reported.

Since the release of these new standards, there have been significant enquiries and questions as providers collect their initial sets of TSMs for the 2023/24 calendar year. In order to answer these questions, there has been an FAQ section added to the gov website relating to fundamental issues and problems people have been having with the first phase.

In a statement from the Regulator of Social Housing, they explained: “This note sets out examples of specific queries received to date, focusing on frequently asked questions and those relating to key fundamental issues. It is intended to inform those already familiar with the published TSM requirements, and covers some technical issues.”

It was noted that the note does not form part of the requirements providers need to meet in order to comply with the TSM Standard.

Queries split into six sections

The note summarises specific queries and responses as follows, with some common themes set out below:

A. General queries on TSM requirements: relating to all TSMs

B. Complaints: TSMs CH01, CH02

C. Neighbourhood management: Anti-Social Behaviour TSM NM01

D. Repairs and stock condition: TSMs RP01, RP02

E. Tenant perception surveys: used to generate TSMs TP01-TP12

F. Building safety: TSMs BS01-BS05.

The Regulator acknowledged that the starting point in answering all queries on TSM requirements is the specific wording of the TSM Technical Requirements and TSM Tenant Survey Requirements. When the regulator comes to assess a provider’s compliance with the TSM Standard, this will ultimately be with reference to the Standard and these two documents.

Many provider queries concern how the TSM requirements apply to particular circumstances. The TSMs necessarily include broad definitions which must be applied across diverse tenants, service models, and stock in the sector.

General queries on technical requirements were the dominant theme

One of the biggest questions asked to the regulator was: ‘What stock types must be included in calculating the TSMs?’

In a bid to answer this, the regulator notes explained: “Paragraphs 11-14 of the technical requirements state that all TSMs must be reported for ‘Low Cost Rental Accommodation’ and/or ‘Low Cost Home Ownership’, depending on what is specified for the relevant TSM in Section 2 of those technical requirements.

“LCRA stock and LCHO are defined according to Sections 69 and 70 of the Housing and Regeneration Act 2008. The TSM technical requirements sets out some examples of stock types which –conventionally defined – would fall within LCRA and LCHO.

“These stock types are intended to illustrate what typically constitutes LCRA and LCHO. However, the key requirement for registered providers in calculating TSMs is to understand which of their dwelling units meet the legal definitions of LCRA

or LCHO under the HRA 2008, taking external legal advice if required. This understanding is fundamental and will need to be reflected in the collection and calculation of all TSMs.”

For reference, LCRA is defined in the HRA 2008 as accommodation that is: (a) made available for rent, (b) has rent that is below the market rate, and (c) made available to people whose needs are not adequately served by the commercial housing market.

LCHO is defined in the HRA 2008 as accommodation that is (a) occupied or made available for occupation in accordance with shared ownership arrangements, shared equity arrangements, or shared ownership trusts; and (b) made available to people whose needs are not adequately served by the commercial housing market. Other aspects of the HRA 2008 may relate to these definitions.

“We would encourage all providers to ensure that they have closely reviewed these documents as an initial step.”

What this implies for the following specific stock types is as follows:

A. Shared ownership units that have not been fully staircased typically fall under the legal definition of LCHO and hence within the scope of the TSMs.

B. Standard market rent properties cannot meet the definition of LCRA (or LCHO) in HRA 2008, since the rent is not below the market rate, and therefore must not be included in the calculation of the TSMs.

C. Providers must determine whether Rent to Buy dwellings meet the definition of LCRA or LCHO, with reference to the HRA (2008) definitions and the legal and other features of these dwellings at the time of reporting.

D. Providers must determine whether gypsy or traveller accommodation meets the definition of LCRA or LCHO, with reference to the HRA (2008) definitions and the legal and other features of these dwellings.

E. Temporary social housing, as defined in the Government’s Policy Statement on Rents for Social Housing 2022, is by definition LCRA and hence must be included in calculating TSMs.

F. Temporary accommodation is a term that is sometimes used in different ways by private and local authority registered providers. Providers must determine whether such stock meets the definition of LCRA (or LCHO), taking external legal advice if required.

G. As long as it meets the definition of LCRA or LCHO, almshouse accommodation must be included in the calculation of TSMs.

Further questions included: ‘Why is certain stock (e.g. non-social or leasehold stock) not included within the scope of the TSMs? What should we report for this stock?’

“Units that are not LCRA or LCHO must not be included in calculating the TSMs. This issue was considered carefully, and the rationale was set out in the consultation document published in December 2021. We concluded that collecting TSM data on non-social and leasehold stock would not be consistent with the remit of the Regulator of Social Housing, and the aims of TSMs set out in the Social Housing White Paper.”

“However, as underlined in the technical requirements (para 2), the TSM requirements in no way prevent providers from publishing performance information relating to leasehold or non-social stock alongside the TSM information (or making this information available to residents through other routes).”

While there were plenty of other questions for the regulator to answer, another query that was in high demand was whether the sector needs to report TSMs at a group level or for individual entities too and how TSMs apply to ALMOs and PFIs.

Answering this topic, it was explained: “The TSM requirements apply at a registered group level. This means, as set out in technical requirements (paras 9-10), that registered group parents must report consolidated TSMs for the group (and are not required to report separate TSMs for individual registered provider entities within the group).”

“The regulator is also aware that some organisations both manage units for other providers (such as an ALMO for local authority units) and own their own stock. These organisations will need to consider their particular structure, including the definitions of ownership and the registered group basis set out in TSM requirements to confirm their reporting requirements.”

“Where more than one registered group has a legal interest in a property (e.g. freehold or leasehold) the key consideration in interpreting TSM requirements is the definition of ownership set out above and which provider has the direct legal relationship with the tenant.”

“Providers need to determine what information they need to report beyond the TSMs specified in the requirements, in order to support effective tenant scrutiny of performance. For some providers this may include reporting TSMs for different entities and management organisations in addition to those reported at group level.”

Further questions were asked in the note section of the gov website, spanning the other aspects mentioned above. Hopefully this can provide the sector with more insight and reduce the teething problems for the first year of submissions.

How £100 Million Will Deliver 10,000 Sustainable Homes in Wales

by Hannah Wintle

Over the next ten years, Pobl, Wales’s largest housing association, will build 10,000 new sustainable homes throughout South Wales, made possible by a £100 million sustainabilitylinked loan from Lloyds Bank. Housing Industry Leaders spoke to James O’Connor of Pobl Group, and Jatinder Dhaliwal of Lloyds Banking Group, to discover how this significant loan will bring positive change to communities in South Wales while supporting housing and climate targets.

At the beginning of September, Pobl Group announced that its ‘ambitious plan’ deliver 10,000 sustainable homes over the next decade have been boosted by the multimillion-pound loan from the Bank.

According to Pobl’s current development plans, homes will be built along the South Wales M4 corridor, reaching from the eastern county of Mommouthshire, all the way to Pembrokeshire in the west.

Of these homes, close to 1,000 will meet an EPC rating of A, with 95% of the homes developed over the next four years to reach a rating of EPC B or above.

James O’Connor, Director of Corporate Finance at Pobl Group, said: “Within Wales there is a collaborative approach to the work we do as housing associations and, I’m pleased to say, a forward thinking, supportive Welsh Government.

“As the largest housing association in Wales, Pobl has the capacity to be able to develop transformational new communities at scale which incorporate a sustainable blend of tenures and investment in low-carbon technology and ecology for the benefit of future residents and the environment alike.”

The loan will incentivise Pobl to meet its sustainability targets

Achieving their targets on energy ratings for new homes, investing in retrofitting its existing properties, and building significant numbers of affordable homes over the next four years, carries the added incentive of lowering the housing association’s borrowing costs.

After assessing different potential funders, Pobl aligned with Lloyds Bank due to the sustainability linkage which supports the housing association’s priorities.

With such an emphasis on the sustainability of these homes, James explained: “Most of our new homes are planned to be EPC A (SAP 92 or above), with some dramatically above this with SAP scores being achieved today as high as 116.

“This reflects investment in very efficient and consistent building fabric which delivers very high levels of air tightness and thermal efficiency. It also reflects scaling up technology such as heat pumps, photovoltaic solar panels, smart batteries and mechanical ventilation heat recovery units, which make a significant contribution to both affordability for residents and reducing operating carbon footprint once occupied.

“We work with local contractors, local offsite manufacturing locations and Welsh timber where possible to minimise transport emissions. Our partnerships with local contractors also incorporate apprenticeships and employment opportunities for our residents and local communities.”

When it comes to their wider sustainability practices, Pobl Group have developed their own tailored response to the climate emergency. Pobl Zero is a decade-long strategy developed with the intention of cutting carbon in homes, places, and across their operations.

Running until 2030, measures outlined by the housing association include investing in skills and carbon literacy for colleagues and customers, making new build homes net zero a new standard, and retrofitting all existing homes to net zero by 2030.

Their ultimate goal is to be a net zero housing association by 2050, as such have adopted a ‘whatever it takes’ approach to cutting carbon from their homes, whether it means substituting windows and doors or installing sustainable technology.

Pobl Group have also invested in the Penderi Energy Project, the largest energy retrofit scheme of its kind in the UK. Having completed the main phase of installations in July, 518 out of 644 homes in the Swansea area are now ready to contribute towards the generation of an anticipated 60% of the community’s total electricity requirements.

Supported by £3.5 million in EU funding from the European Regional Development Fund (ERDF) through the Welsh Government, the renewable energy sourcing scheme will help residents reduce their energy bills and carbon emissions by up 350 tonnes per year.

“We are committed to creating the sustainable homes and communities that Wales badly needs, a commitment shared by other housing associations and funding partners,” James added.

“For Pobl, it is crucial that any sustainability linkage in financial products is closely aligned to our core strategy rather than constructed simply for the purpose of the loan product, enabling us to deliver projects with real social and environmental value which becomes a yardstick for the wider sector.”

“Achieving their targets carries the added incentive of lowering the housing association’s borrowing costs.”

Lloyds Bank continue to actively support the UK housing sector

Jatinder Dhaliwal, Regional Head of Housing at Lloyds Bank, outlined the Bank’s mission to ‘Help Britain Prosper’, which includes improving access to affordable housing, and enabling the transition to a low-carbon economy that is inclusive of all individuals, communities, and businesses.

To achieve this, Lloyds Banking Group have put in place several targets to support decarbonisation, including sustainable lending and investment to help drive growth and support key sectors in the transition.

Jatinder also said that the Bank is proud to work with housing associations across the country: “It’s important to us that funding we provide [to housing associations] supports our purpose-led approach, which is to deliver meaningful impact while helping to deliver safe, affordable and sustainable local housing.

“We have a long-standing relationship with Pobl Group and are delighted to have worked with them while they’ve delivered great things over the years. We’ve taken time to understand their priorities and strategy, so that we can best support them in realising their ambitious plans, which this latest funding will help them to achieve.”

Their £100 million loan to the housing association is the latest in Lloyd Banking Group’s endeavours to enact change in the UK housing sector. They have provided approximately £4 billion since 2021 to make the UK housing stock more energy-efficient, and the 35,000 new social homes they have helped to facilitate the building of has housed an estimated 75,000 people.

Lloyds Banking Group have provided around £16 billion in funding to the social housing sector since 2021, and currently work with over 200 housing associations around the UK, making it the biggest supporter of social housing in the UK.

“The housing associations we work with place significant importance on ensuring that funding will help them meet a range of needs including regional development, sustainability, accessibility and inclusivity,” Jatinder commented.

This latest funding support from the Bank will aid in Pobl’s mission to deliver a significant number of homes to the communities across the south of Wales, and ensure that sustainability remains a top priority.

Could Bio-Based Materials Be the Future of Retrofit?

by Hannah Wintle

The materials we use to retrofit buildings play a huge role in how environmentally friendly our homes actually are, and with measures such as insulation primarily composed of synthetic materials, Housing Industry Leaders asks whether bio-based materials could prove a more sustainable option going forward. Retrofit is an important topic of conversation within the housing sector, and with a staggering 80% of buildings needed by 2050 having already been built, it’s easy to see why. The question of how we retrofit these buildings, however, is the focus of a two-year project launched last month by researchers across South West and South Wales. Running the project are the GW4 Alliance of universities: Bristol, Bath, Cardiff, and Exeter. Together with industry, community groups, and local authorities, they’ve been tasked to design ‘Beyond Net Zero’ liveable, low-carbon housing fit for the future.

Having been awarded £4.6 million in funding from the Arts and Humanities Research Council (AHRC), the alliance will research, design, and test prototypes of retrofit measures using bio-based materials.

“The project is in response to the AHRC Green Transition Ecosystems Competition,” Professor Pete Walker told Housing Industry Leaders.

“It is based on long standing interests in biobased materials for built environment, low energy building design, retrofitting of existing buildings, architectural design research, and public engagement in built environment.”

A Professor of Innovative Construction Materials since 2006, Professor Walker is the Principal Investigator and co-director of the project, and has been a researcher and teacher at the University of Bath since 1998. He is also a Chartered Civil and Structural Engineer, and has over 30 years of experience working with natural building materials.

Bio-based materials could reduce carbon emissions and environmental impact

Currently, there is a heavy reliance in the UK for synthetic materials when to comes to retrofitting, particularly when it comes to insulation. The embodied carbon emissions of spray foam insulation and plastics can even exceed the carbon savings they create when used to retrofit homes.

Their impact on the environment, therefore, can result in a net-negative, despite the intention of their use to improve the energy efficiency of homes.

Bio-based materials provide a far less carbonintensive solution to retrofitting. Derived from renewable resources such as crops, cork, wood, and fungus mycelium, bio-based materials reduce carbon emissions and environmental impact, while providing home improvements that are energy efficient, healthy, and sustainable.

Professor Walker said: “Plant based materials, including timber, absorb atmospheric CO2 through photosynthesis, forming a ‘biogenic carbon store’.

“The cumulative global carbon storage from the wider uptake of bio-based structural materials alone could be up to 60 Gt.CO2 from 2020 to 2050; 14% of the carbon budget recommended by the IPCC to limit global warming by 1.5°C.

“They provide greater resilience to changing UK climates, and there are greater opportunities for recycling and circular solutions rather than landfill.”

As well as their environmental benefits, Professor Walker also pointed out the health impacts these natural solutions could have, something especially poignant as housing associations throughout the nation seek to address damp and mould issues in the wake of the mould-related death of toddler Awaab Ishak.

“As well as environmental benefits, bio-based vapour permeable products and systems provide energy efficient, healthy, and sustainable improvements to existing homes,” he explained.

“Natural fibre insulation is well suited to older masonry walls, and other traditional buildings, as its vapour permeability prevents problems with damp and humidity.”

In terms of durability, bio-based materials can provide long-term durability for periods of over 50 years. Thatched roofs prove a good example due to their prominence throughout history and their ability to insulate close to modern standards.

Professor Walker added: “The key for longer term performance is the selection of appropriate and good quality materials, good design, installation, and maintenance.

“Ensuring long term performance is key amongst research, and this is ensured through performance testing and modelling.”

“Bio-based materials reduce carbon emissions and environmental impact, while providing home improvements that are energy efficient, healthy, and sustainable”

Government policy could accelerate the wider uptake of bio-based materials

While the benefits of using bio-based materials make them seem like an attractive option, their use makes up only 0.2-0.3% of the UK market compared to many other European countries where this can reach 10% for natural fibre insulation (NFI).

“Despite their much lower embodied carbon, the use of bio-based materials, compared to many other European countries remains under-utilised in the UK. The UK still largely relies on imports for its NFI products,” Professor Walker said.

Now, it is hoped that the project will help influence government policy by moving the conversation around the governance of bio-based materials forward.

The homes used as a testing bed for bio-based materials will provide tangible evidence and become case studies of the benefits of retrofitting homes using these measures, while their occupants share their positive experiences within their communities and combat a potential resistance to change.

In demonstrating the positives through these homes, Professor Walker is optimistic that the foundations can be laid for sustainable retrofit practices going forward.

“Greater use of locally sourced bio-based and nonextractive materials to retrofit and remodel existing social housing will only happen with the resolution of numerous governance concerns.

“Governance support, in terms of policy, planning, building regulation, operational practice, and ownership and maintenance, is particularly important and impactful area to push forward design innovation as it can either restrict innovation or lead to unacceptable risk taking. There is a lack of comprehensive understanding of governance arrangements around the use of bio-based products.

“The research will foster dialogue, engagement, and action through transdisciplinary, intergenerational, community and cross stakeholder participation. This grassroots approach will provoke new insights and solutions, but the research case studies set the basis to create templates for policy and wider practice.”

As the government turns its focus into decarbonising the existing housing stock to meet net zero targets, a heavy emphasis has fallen on retrofit to get us there.

The risk of undermining carbon emission savings through carbon-intensive synthetic retrofit materials could impact the UK’s wider climate goals, and where alternative, bio-based solutions can offer the same benefits with a lower environmental impact, this could provide an appropriate solution.

Ultimately, improving the energy efficiency of housing remains of paramount importance, but making sustainable decisions on how this is done is an essential consideration for housing associations and local authorities going forward.

Wales Lead the Decarbonisation Race

Q. Let’s just start with a little bit about you first. Can you tell me about MCS and the work that you do?

A. Yeah, sure. MCS is short for the Microgeneration Certification Scheme. Microgeneration is small scale renewables, domestic renewables, like solar panels and heat pumps. So, what MCS does, it’s sort of the quality assurance department for the sector. We certify low carbon products and their installation, so both the product and the installation, that produce electricity and heat from renewable sources…

Q. Let’s delve into an overview of the situation at present. Wales is in the lead as the top UK nation for renewable energy installations, but what are the current statistics?

A. Yeah, it’s really exciting news for Wales because, ever since our records began back in 2009, it’s been Scotland that’s been leading the way. And some of the local authorities in Scotland, we call them renewables superstars, they really have been adopting this technology at scale.

But in the last year, Wales has really taken the lead, and particularly in the last few months with the installation of solar panels, so the stats are as follows:

For Wales, as a percentage of households, we’re seeing numbers of 7.39%. That’s very precise, I know, and that compares to Scotland at 7.36% of homes. So, just taking the lead, but fantastic position for Wales and businesses and consumers and of course the fight against climate change. So great news all round for Wales…

In this episode, we speak to Ian Rippin about what Wales is doing right in terms of its renewable energy installations, and what the wider UK can learn from their example.

Q. Scotland were in the lead for some time, but Wales has recently taken over with a higher percentage of households with installations. Why do you think this is? Why are Wales doing so well at the moment in this regard?

A. Yeah, great question, because we want these ingredients to be used all over the place don’t we? Because the role that this technology can play in our drive towards net zero by 2050 is enormous when you consider that most of the research says that between 17% and 21% of all of our carbon footprint, our emissions comes from our homes, the way we heat them, the hot water that we need, and the electricity that we consume.

So, what are the factors that drive that? And it is a real mix. Not least the economic climate, most of us now are very aware of our energy bills and the price of electricity in particular, so we’re forming a different relationship with energy, in my opinion, that perhaps we’ve taken cheap gas, for example, for granted.

I think the economic argument is really clear that solar panels can cut the cost of your electricity bill, what we would call home grown energy. You have the energy from your roof. It’s your energy, and there’s a sense of pride in that…

Q. Wales is certainly setting an example for the rest of the UK to follow at the moment. Can they keep up with this momentum into the future, do you think?

A. Absolutely. I mean, while we’re celebrating nearly one in ten homes having some kind of renewable energy technology in Wales, that is still the early days. We’re in the early days of this technology and all the drivers are there.

I think post-pandemic there were issues with supply chain of the technology both for solar panels and for heat pumps. A lot of that has now worked its way through the system. We hear from our MCS certified contractors, the installers, that they’ve got large order books, and are now looking to grow their businesses. One of the challenges we face is the number of installers that are available to us in Wales, but also, once the market demand is there and the hunger is there for this technology, that will start to solve itself…

Public Sector Round Up

Over the past month, Housing Industry Leaders have covered an array of stories across policy, retrofit, technology, and planning. Here are the highlights:

POLICY

Firstly, Heat pumps could be made more accessible to homeowners and small businesses under measures proposed by the government.

Varied grants, which would depend on customers’ property type or existing fuel source, could be made available to make heat pumps cheaper and easier to install.

RETROFIT

In retrofit news, the Wates Group will deliver a £35 million major-works programme across Brent Council’s social housing portfolio, which will include measures to improve energy efficiency.

Scheduled for run for 80 weeks, the works will see improvements such as new windows, kitchens, and bathrooms, as well as lift refurbishments.

Brent Council’s fire safety and compliance will also be supported through the installation of new sprinkler systems, as well as full mechanical and electrical upgrades.

As part of the council’s retrofit strategy, the energy efficiency of these homes will also be improved by new external wall insulation.

Wates’s previous work with Brent Council has included an array of retrofit installations to increase home efficiency following the Group’s successful retrofit pilot, which reached completion at the end of 2021.

By enabling more households to access low-cost, low-carbon heating, the government hope it will allow a shift away from costly foreign fossil fuels and onto cleaner, cheaper homegrown energy.

In an effort to decarbonise the nations heating, more than £81 million in vouchers have already been issued to customers under the Boiler Upgrade Scheme.

The scheme, which offers grants of up to £6,000 for heat pumps, previously came under criticism from the Energy and Utilities Alliance due to poorer households missing out while the rich enjoyed tax breaks and discounts.

Having now acknowledged that the current grant system is too simple, the government are consulting on making necessary changes.

Through the project, the Wates Retrofit team installed energy efficiency measures in void properties, taking them from an Energy Performance Certificate (EPC) rating of E to B, which exceeds the government’s 2030 target for social housing.

TECHNOLOGY

In technology, Cotswolds residents have been offered a discount on their solar panel installations, thanks to a partnership between Cotswold District Council and MakeMyHouseGreen.

MakeMyHouseGreen, a provider that offers support to its customers through the specification, purchase, and operation of not only solar photovoltaic panels, but also home storage batteries and electric vehicle chargers, have joined the council through their new Cotswold Home Solar project.

The development has been designed specifically to contribute towards Telford & Wrekin Council’s commitment to tackling climate change and providing tenants with support during the current cost of living crisis.

It has been said by the council that solar panels and EV charging points at Nuplace’s Southwater Way development are saving an average 3-bedroom household as much as £900 annually in energy bills (based on projected energy prices for 2022/23).

Located at ‘Wild Walk’ in Donnington, the properties form part of a much wider development of 329 new homes.

These homes are being brought forward by a partnership comprising of Telford & Wrekin Council, Nuplace, Lovell Partnerships Ltd, and Wrekin Housing Group.

Through the project, any Cotswold District resident who goes through the provider in installing their domestic solar panels will be eligible for a councilarranged discount of £250.

By using data specific to their homes, MakeMyHouseGreen allows its customers to research the associated costs when it comes to installing solar panels.

This data also enables users to access key documents, and monitor how much energy they are saving.

PLANNING

Finally, Telford & Wrekin Council has announced that it has launched its first ever Future Homes standard properties.

The mixed tenure site includes properties for open market sale, private and affordable rent, Rent to Buy, and dementia care and supported living units. Details have launched this week for Nuplace’s 66 new homes, with the first phase of private rent properties being released to the market. The properties range from 1 to 4-bedroom houses, apartments and bungalows.

Of the 66 homes being developed, 16 of these are being built to accessible and adaptable standards and are available for people who are over the age of 55, or with a demonstrable need.

In Case You Missed It

If you couldn’t attend Housing Industry Leaders Cymru, be sure to check the highlight reel that captures the day’s key moments. This includes keynote speeches, engaging panel discussions, and valuable networking sessions in the exhibition zone.

We heard from notable speakers at the event including the First Minister of Wales, Rt Hon Mark Drakeford MS, as well as Ian Mather from PH Jones, and Carl Raison from Ideal Heating, who shared their insights.

Don’t miss the opportunity to catch up on

First Minister of Wales, Rt Hon Mark Drakeford MS

the highlights and gain beneficial industry knowledge!

“We have good reason to be hopeful here in Wales.”

“We feel we have a really important responsibility and important to play to help the country transition to net zero carbon.”

Ian Mather, National Renewables Strategic BDM at PH Jones

“On the route to decarbonisation, we look to lead the way with our Monobloc system and our Split systems as well.”

Carl Raison, Technical Sales Manager at Ideal Heating

Scotland

Radisson Blu, Glasgow

29 November 2023

Building on the initial phases of the Affordable Housing Supply Programme, this one-day conference will explore how funding mechanisms for housing providers help to deliver homes across Scotland.

With a commitment to delivering 110,000 affordable homes by 2032, the Scottish Government has allocated £752m for 2023-2024 to help support their plans.

The event will highlight how Scotland will Deliver Affordable Housing, why Retrofit is essential for decarbonising existing housing stock and how low-carbon technologies will support this. This will be done through keynote speeches, panel discussions and technical seminars.

#HousingScotland

#HousingLeaders

housingindustryleaders.com