Thank you for the invitation. I’m delighted to be here at the British Property Federation’s Annual Residential Conference. I’m pleased to…
Thank you for the invitation. I’m delighted to be here at the British Property Federation’s Annual Residential Conference.
I’m pleased to see sustainability on your packed agenda for the day, alongside discussions on investment and the future of the residential property sector.
As you may know, the Coalition has pledged to be the Greenest Government ever. At the heart of this pledge is energy efficiency.
Indeed, in a world of increasing energy prices, market volatility and reliance on imports, energy efficiency has never been more important.
That’s why we are creating the framework for the Green Deal. It is our way of helping homeowners, landlords and tenants get home improvements like loft insulation, boilers and double glazing at no upfront cost.
Today, I wanted to draw out three key points to unpack that simple description.
Firstly, this is a new way of approaching energy efficiency.
Secondly, it will create a brand new market.
Thirdly, the power of communities will be at the heart of in delivering this agenda.
But first, to give some more context.
Here in the UK, We have some of the worst performing buildings in Europe. More than half of our homes don’t have sufficient insulation. They leak heat like a sieve.
The UK building stock was responsible for 43% of total UK emissions in 2009.
And despite the relatively mild winter we are coming through, increasing numbers of families are struggling to pay their energy bills and have been hit by rising energy prices over recent years. We estimate that this year up to 4.1m households will be in fuel poverty in England alone.
Energy efficiency can help tackle each of these challenges. It is a win-win-win scenario: reduce emissions, save money and create opportunities for business.
Loft to living room
The Green Deal is a different approach to energy efficiency. It places consumers at the centre of the policy. It isn’t about stop start Government driven and owned programme of works. It is about consumers driving demand and a competitive market responding.
We’re also ensuring through the new Energy Company Obligation that support is provided to tackle fuel poverty and for those needing the most expensive measures such as solid wall insulation.
We want to take energy efficiency from the image of dirty, dusty loft insulation to cosy living rooms and beautiful houses. From loft to living room and boring to bling.
No longer will every discussion of energy efficiency require the obligatory a picture of a hearty workman in a face mask cheerfully laying another roll of loft insulation in some cramped dusty loft.
Backed with strong consumer protection, we are providing people with opportunities for investing in their home - and let’s face it, people are always looking to improve their homes, even in times of austerity.
Perhaps the tangible benefits energy efficiency treatments can bring, is best illustrated by some pictures. Taking a leaf from the many home improvement shows and magazines - here are some before and after pictures.
This improvement is a result of a partnership between British Gas, Walsall Housing Group and Walsall Council in the West Midlands, under the Community Energy Saving Programme (CESP).
This is an excellent example of a mixed tenure project. It has delivered a comprehensive range of measures including boiler replacement, loft insulation, energy advice and - as the photos show - external solid wall insulation.
The solid wall insulation has drastically improved the appearance of the properties, improved the energy efficiency and in a number of cases tackled a damp problem on exterior walls. Treating properties on this street by street approach has also helped to considerably improve the local environment and made the area a better place to live.
To give a second example, I had the pleasure of visiting Salford last year, including a tour of homes installed with external solid wall insulation.
Homes on the Regent Park estate were built in the 1970s, timber framed with no wall insulation.
As they had a traditional brick appearance, residents were keen to keep the look. This was something they achieved with a brick effect render on top of the insulation. Here is a happy resident, talking me through the finished effect.
Energy efficiency aside, this has clear kerb appeal too.
I am also aware of an innovative scheme in Stockton where a partnership of the local council and Eggborough Power are aiming to provide solid wall insulation and other measures to at least six hundred mainly private homes in the town centre. Many of these homes were previously scheduled for demolition.
They are largely good solid Victorian terraces which have served well for over a hundred years, but they can be cold and crippling expensive to heat for those on low incomes.
However, with these energy efficiency improvements they are now being given a new lease of life, as has the whole local community. And there is no reason to believe they should not be providing warm and cosy accommodation for the next hundred years.
So I think it important to recognise that the drive energy efficiency is not just about saving carbon, important though that is. It is also about providing people with homes they are happy to live in.
But this isn’t just good for the consumer. It is also good for economic growth. There is a massive new market opportunity for businesses and industry.
Our estimates suggest the Green Deal could support up to 65,000 jobs by 2015. And we are talking about billions of pounds worth of investment.
In this way, the Green Deal is as much a part of our growth agenda as it is a part of our climate change policy.
Government is creating the legal framework but we aren’t prescribing a single business model. Our intention is for this to be a new, open and dynamic market that will drive innovation.
And to help this newly forming market in its early days, we have announced a £200m injection of Government funding to provide a time limited introductory offer. It demonstrates that we are serious about hitting the ground running.
To help ensure the best deal for consumers, we wanted to encourage a wide variety of different businesses - large and small - local authorities, social housing providers and third sector organisations to play a role in this new market.
And I’m pleased to say that there are a number of organisations looking to enter the market with a variety of different business models. These models include - but are by no means restricted to - keeping all the functions in house, out sourcing the supply chain and working in partnership with SMEs.
We have been having conversations with these organisations from the outset, but the tone is changing. We are moving from theory to practice.
As the landlords, owners, investors and developers of what must be collectively an impressive property portfolio, I would encourage you to consider your role.
Power of communities
Strong local participation will also be key to rolling out the Green Deal.
This Government is passionate about giving more power and responsibility to local people, neighbourhoods and communities to create better local services and outcomes. It is the Big Society.
And the Green Deal offers opportunities for Big Society style collaborations working with and through a range of partnerships according to local needs.
Landlords - both private and social - could all have an important role to play here, alongside Local Authorities and Community Organisations.
These organisations will know the needs and wants in their local areas. They will also be able to foster local economic development including supporting the maintenance and generation of local jobs and skills.
There is already evidence that communities are responding. Our £10 million Local Energy Assessment Fund is helping local communities come forward with their plans and preparation for the Green Deal.
From the London Borough of Merton’s local champions producing a list of households ready for a Green Deal advisor visit to Warwickshire’s ‘carbon dating’ matching interested consumers with an open home demonstrating the results.
And from Brighton’s ‘go early’ Green Deal pilots to Church Stretton in Shropshire installing solid wall insulation in their Town Council offices.
This is just a sample. There are over 200 more inspirational examples of how local communities are gearing up for increased energy efficiency and renewable energy generation through the LEAF fund.
In terms of next steps, the Green Deal framework is now receiving its final touches.
The primary legislation to make the Green Deal a reality is already on the statute books. And we are currently finalising the secondary legislation following our public consultation.
Throughout this process stakeholders have been advising us on how to shape the framework to work with the grain of business whilst offering robust consumer protection.
I would like to thank the British Property Federation, and your members, for your input and support to-date in helping to create this framework.
And I hope it doesn’t stop there. As we enter the final stretch in the lead up to launch, I look forward to further collaboration to help make this market a success.