Is Retrofitting Homes the Silver Bullet for Net Zero?

Hayley Steel, a partner specialising in non-contentious construction at national law firm Clarke Willmott LLP, looks at whether retrofitting homes could help achieve Government plans for net-zero by 2050 and a 78% reduction in harmful emissions by 2035.

The answer on face value should be “yes” as homes emissions constitute around 20% of all emissions. Retrofitting measures are wide and varied, including double or triple glazing, wall or loft insulation and transitioning from fossil fuel heating, such as a gas boiler, to ground or air-heat pumps. Methods normally fit into two camps, the first being “fabric first”, which looks at upgrading existing materials or measures, such as loft insulation. The second is “whole home”, which looks at the integral fabric and systems, such as lighting and heating.

In the UK, there are 28.3 million homes ranging from studio apartments to Grade 1 listed properties. Many of these properties are not particularly energy-efficient, as highlighted by the Office of National Statistics (ONS), with the average home Energy Performance Certificate (EPC) rating being D or below. It is estimated that 24 million of these homes could, or should, be retrofitted to achieve a reduction in energy consumption and emissions.

The challenge is that there are so many different types of properties, some relatively quick and easy to retrofit, with others such as listed properties being more complex and expensive. Solutions can range from readily available, tried-and-tested methods to specialist bespoke projects. Add into the mix different ownership and stakeholders, whether council, social housing or private, and it is clear that there cannot be a one size fits all solution.

If the UK Government had an ambition to retrofit all 24 million homes by the end of 2035 to help reduce the 78% emissions target, over 1.8 million homes would have to be retrofitted every year. This alone would be very challenging, particularly when the 300,000 new homes per year target continues to be missed. If you add other construction activities including removing dangerous cladding materials from high rise buildings and retrofitting non-domestic buildings to become EPC B rated by 2030, the challenge becomes even more acute.

The demand for labour and skills within the construction industry remains a challenge and is at a twenty-year high. The ONS has reported a shortfall of 42,000 unfilled current vacancies in the sector for the period ending December, which would be stretched further if a full home retrofit programme was launched. In addition, with an ageing workforce, this figure is likely to rise in the next 10 years. Therefore, a more tailored and phased approach is needed to make a significant dent in the number of homes that need retrofitting.

Perhaps we might see a greater focus on targeting council-owned properties and social housing providers first, along with some mandatory expectations, such as all of these properties being EPC C rated by 2030. Whilst I appreciate there are grants for ground and air heated pumps available, additional and more substantive grants could be offered to help support private individuals potentially on a means-tested basis to change behaviours.

Some estate agents who I have spoken to have seen a shift in buyers’ expectations and requirements in relation to the energy efficiency of prospective homes to buy in terms of environmental and monetary considerations. Those with the highest EPC rating are starting to attract an additional premium.

Overall, I think it could be a two-pronged approach with the Government providing both carrot and stick measures, along with the realisation of homeowners that retrofitting in the long term will be good for both the bank balance and the environment.