Retrofit revolution
Local authorities are providing important solutions and playing a key role in the push for net zero-carbon
INNOVATION & IMPROVEMENT
Image: Istock
James McHugh
Senior Consultant, Campbell Tickell
Issue 66 | June 2023
Housing providers face a range of challenges retrofitting their homes in time to hit the government’s 2050 net zero-carbon target. This article focuses on the issues and some solutions for local authorities.
What is retrofit?
Retrofit denotes the addition of new technology or features to older systems. In a housing context it is used to cover the range of energy efficiency improvements – such as insulation, solar panels and heat pumps – which reduce the carbon emissions of homes (and often reduce running costs too).
The past year has seen a slew of mainstream media articles extolling the benefit (and also risks) of retrofitting homes. Such references to retrofit are no doubt a reflection of two key drivers of public sentiment. First, the cost-of-living crisis, which has had a profound impact on UK households’ utility bills. Second, the increasingly apparent impacts of climate change across the country. Retrofitting homes (rather than subsidised bills) is the only long-term sustainable solution to both issues.
Retrofitting at scale
While there is increasing popular awareness of retrofit, the challenges to achieving it at scale remain considerable and serve to prevent interest from becoming activity. Such challenges can typically be divided into three categories:
1. Access to information for households about retrofit measures.
2. Access to suppliers with the skill and materials to deliver measures.
3. Access to funding required to pay for the work.
None of these challenges can be addressed alone, lest there be the risk of stimulating unmet demand, failing suppliers, or confusing households.
Local authority context
Local authorities are uniquely placed to address these challenges based on their knowledge, partnerships and political commitment to the retrofit agenda. Many local authorities have declared a climate emergency, often committing themselves to a more ambitious net zero target than central government.
Homes often represent the single biggest source of a local authority area’s emissions. Those owned and managed by local authorities tend to be among the most energy-efficient (59% have an Energy Performance Certificate (EPC) rating of C or higher). This reflects both their build date, with a preponderance of post-war flats and maisonettes, as well as cyclical improvement works needed to reach the Decent Homes Standard.
A high EPC rating can, however, mask a range of other failings in any given property, such as the incidence of damp and mould where not properly ventilated. Moreover, there remain significant pressures on the Housing Revenue Account from other issues, such as building safety and housing delivery, compounded by the latest rent cap and continued high levels of inflation.
Enabler role
So what are some of the solutions local authorities have identified? Aside from retrofitting their own homes, local authorities can play a crucial role as enablers of retrofit in their areas. This may involve:
- Embracing a proactive and supportive role through the planning process
- Engaging with local businesses
- Promoting relevant training provision
- Enforcing appropriate standards through property licensing
- Signposting and making referrals from across health and social care
- Engaging with private landlords and registered providers in various forums and strategic communications
Proactive role
The proactive role taken by local authorities in the retrofit agenda can be seen in the allocations made in the latest round of the government’s Social Housing Decarbonisation Fund (SHDF).
Of the £782m allocated under the latest wave of the SHDF, 69 of 109 successful bids were from local authorities, accounting for more than £462 million of the funds (albeit some of this may be distributed to registered providers as part of a consortium).
Six of the top 10 bids came from local government, including considerable bids from Nottingham City Council (£47.2 million), the Greater Manchester Combined Authority (£37 million), and Liverpool City Region (£31.7 million).
Nottingham City Council has long been leading the way via its partnership with Energiesprong, while Greater Manchester’s Mayor, Andy Burnham, has established a regional retrofit taskforce to oversee a range of initiatives, as well as the inclusion of retrofit funding in the latest devolution deal from the government.
Tackling fuel poverty through retrofit
Beyond the social housing sector, local authorities throughout England are also promoting retrofit for those in fuel poverty through the latest round of the Homes Upgrade Grant (worth £630 million in total). As well as supporting the delivery of works under the Energy Company Obligation scheme, which is forecast to be worth £4 billion.
Such investment from central government is to be welcomed, especially if further sums are committed to SHDF as per the original plans of almost £4 billion. However, many local authorities are struggling with similar challenges in delivering these programmes. Issues include:
- Short timescales for recruiting households and delivering works
- Admin-heavy reporting to funders
- A lack of qualified suppliers
- Inflation making work unviable within fixed cost caps
Reviewing the way this vital work is approached and funded could help move the dial. For instance by promoting longer term funding settlements, including support for local capacity-building and allowing the time for public funding to be combined with other sources of investment. This is an agenda on which we simply cannot afford to wait.
“Of the £782 million allocated under the latest wave of the SHDF, 69 of 109 successful bids were from local authorities, accounting for more than £462 million of the funds.”
