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Construction And Energy – The Need For Joined Up Policy In Delivering Net Zero

Our Chief Executive Jade Lewis reflects on the construction and energy sectors following UK Construction Week, May 2022

For those of you who don’t know the Sustainable Energy Association, we are a membership organisation made up of manufacturers, energy suppliers, housing providers, installers, innovators and other organisations with expertise on energy in buildings.

The SEA exists to help create living and working spaces fit for future generations.

We recognise that there is no single solution to decarbonising energy in buildings. A range of technology solutions, financing models, and delivery methods are required. In practice, reducing the energy needs of buildings requires a multi technology solution, tailored to the circumstances of the building and its occupants. In other words, a whole house, technology neutral approach, which starts with the building fabric.

Our vision will be achieved when all buildings are energy efficient, net-zero carbon, warm and healthy.

We have identified 5 key deliverables that must be addressed if we are to achieve this vision.

Firstly, that the knowledge and skills exist in the industry to deliver a holistic approach to decarbonising buildings, while enhancing health and wellbeing.

Secondly, good quality and high performance are the norm in the sustainable energy and energy efficiency sectors.

We need strong consumer and client demand for energy efficiency and low carbon heating solutions.

Also, rapid take up of innovation, of new and existing technologies, to advance the delivery of energy efficient and low carbon buildings.

But most importantly, we need long-term, joined up and effective policy and regulation to deliver energy efficiency and sustainable energy in our UK buildings.

Over the past 18 months we have seen a huge range of new policies and strategies being published by government, including the long-awaited Heat and Buildings Strategy. However, there are still numerous gaps that need to be addressed to help us realise this vision.

ABLE TO PAY

A significant gap remains for the 60% of existing homes which are owner-occupied and not fuel poor, the so called ‘able-to-pay’ sector. With the current Energy Bill Crisis, which is expected to remain with us for the long term, we are concerned that many more households will fall into fuel poverty, and this is something we are determined to help prevent. True progress in Net-Zero needs to address this key stakeholder group, it is crucial to facilitate the movement away from a heavy reliance on government funding into an independent retrofit market which is self-sufficient and delivers at scale.

The SEA set out solutions for the able to pay sector in our 2020 report that focuses on encouraging action at key trigger points, where the homeowner is enabled or nudged towards the installation of energy efficiency measures, such as when they are moving home. For example, stamp duty or Council Tax adjustments, where households would pay less the more energy efficient the property is.

The SEA also advocates for an ECO+ Scheme, which would build upon the success of the current ECO scheme, bringing its benefits to the ‘able-to-pay’.

Improvements are required to the EPC process for these solutions to be effective and the SEA has long advocated for the introduction of a Building Passport.

CONSUMER AND SUPPLY CHAIN KNOWLEDGE

The next gap is lack of awareness and knowledge.

Knowledge of alternative heating technologies have been increasing in recent years through increased awareness of climate change. However, there is still a significant lack of consumer and installer knowledge regarding low carbon technologies compared to their traditional fossil fuel heating system counterparts.

Industry skills must incorporate a whole house approach, so that those who install products have an awareness of the entire property and therefore can ensure an efficient installation without unintended consequences.

There needs to be a commitment to providing independent consumer advice through a ‘one stop shop’, as this will be crucial to helping homeowners through the transition.

The new build housing sector has a Future Homes hub, but we don’t have the same in the retrofit sector to help with the knowledge and skills gap.

REBALANCING THE COST

Fossil gas is cheaper than clean electricity. It is important that, when people make the switch to low carbon technologies, they are being rewarded for using cleaner heat rather than facing higher bills. Levies applied to the electricity bill are exacerbating the problem and we are yet to see the Government’s proposals for addressing this issue.

TECHNOLOGY AGNOSTIC APPROACH AND INNOVATION

The SEA advocates a fabric first, technology agnostic approach and believes that overly prescriptive policy can inhibit innovation and lead to unintended consequences. Therefore, low carbon technologies and energy efficiency measures that meet the space and water heat demands of the building in question and lead to the right outcomes should be supported by government schemes.

Government schemes must also support the use of innovation to help the adoption of new and existing, but not widely adopted, technologies. SMEs have a considerable challenge to get their products certified and eligible for government schemes due to the costs and complexity involved. There must be an efficient process to allow businesses the chance to demonstrate the impact of their products and solutions and help aid the transition to Net-Zero, while ensuring quality.

HEALTH AND WELLBEING

The indoor built environment contributes directly to people’s health and wellbeing. We spend on average 90% of our time indoors, therefore addressing this alongside carbon reduction is more important now than ever. We have a real opportunity to create and use buildings to promote positive health and wellbeing while addressing net zero.

The Government and local authorities should make health and well-being a top priority, alongside the levelling up and zero carbon agendas. It would be great to see the UK Government replicate legislation passed in Wales. Their Well-being of Future Generations Act requires public bodies to think about the long-term impact of their decisions to prevent persistent problems such as poverty, health inequalities and climate change.

BRIDGE THE GAP BETWEEN CONSTRUCTION AND ENERGY

I do believe that the solution to delivering net zero lies in improved collaboration between the construction and energy sectors, so policies should be joined up across the two sectors. The SEA is working closely with BEIS and the Construction Leadership Council to make this a reality. In particular, the CLC and SEA are advocating for a National Retrofit Strategy, where the biggest policy gap remains.

We have also been working with the Cabinet Office to update the Construction Playbook which sets out key policies and guidance for how public sector projects and programmes are assessed, procured, and delivered. Government can drive change by procuring for value as a key client to the construction sector. Broadening this approach into the new build housing and retrofit sectors would help drive change towards net zero.

We are seeing the beginnings of a momentum that will change the way we do things in the energy and the construction sectors for decades to come. Provided we as an industry seek to work collaboratively with the Government to address the gaps and improve the clarity, consistency, and confidence that is needed from policy to stimulate investment in the necessary resources, we believe that we will be on the right path towards a just and efficient transition to Net-Zero.

 

Tuesday, May 10th, 2022