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Baker Homes Blog

The fuel poverty strategy – what does it mean for social landlords?

Posted by John Stapleton on 16-Apr-2015 07:00:00

In 2022 the Government unveiled a revised fuel poverty target, the headline element being to improve fuel poor homes to an EPC ‘C’ by 2030 – the ‘what’. Last month the ‘how’ was presented to Parliament in the form of a new fuel poverty strategy. So what does it mean for social landlords?

The short answer is not a great deal – at least in terms of hard and fast regulations. Some have asked if this meant that housing associations were now duty-bound to bring all their homes up to the 2030 standard. It does not.

Firstly, confusion has been created by the fact of targets being enshrined in law. Whilst sounding impressive, this is primarily presentational rather than anything substantive. It demonstrates weight of commitment, and means that a future government would need the symbolically fraught device of legislation if it wished to change or abandon the target. It has been used several times before, for example in connection with child poverty, and only last week the SNP announced a pretty meaningless ‘legal duty to help children from poorer backgrounds perform better at school’). The most well-known manifestation is of course the Climate Change Act, obliging the UK to reduce carbon emissions by 2050 – though this is bolstered by European targets which will in theory attract fines if they are not met.

Secondly, the wording of the target includes the somewhat weasel phrase ‘as many fuel poor homes as is reasonably practicable’. This leaves the door open for any number of obstacles, real or imagined, to get in the way (lack of cash being only the most obvious). In fairness, this is nothing new – the previous target was to eliminate fuel poverty by 2016, with a similar ‘where practicably possible’ caveat.

Thirdly, although the new focus on the energy efficiency of homes is a very good one, the waters have been muddied by the provision to allow discounts on bills to be included in a property’s energy efficiency calculation. This means that an EPC ‘C’ property may, in fact, not be a ‘C’ at all, but a ‘D’ whose nominal rating has been topped up with cash support for the bill payer.

This speaks to a broader point. Even the new ‘low income-high-cost’ definition of fuel poverty is a comparatively blunt instrument. An obvious point that bears repeating is that people move in and out of fuel poverty. The principle determinants, of course, are household income and fuel bills – meaning the Government is taking aim at a moving target. Because of this, the temptation will always be to deal with it through cash top-ups: the easier, though much less durable alternative to permanent energy efficiency measures. When circumstances change or people move, investing up front like this could result in the measures being ‘wasted’ on the non-fuel poor. And no government likes waste.

Private landlords will, from 2018, be legally obliged to improve homes to at least an ‘E’ – albeit with troubling exceptions. No such standards are currently slated for social housing. Does this mean social landlords need not concern themselves with energy efficiency? No. The standards for private landlords were designed to raise a very low bar slightly northwards, but reflect a matter of priority, not principle. As per the last English Housing Survey, the average EPC in private rented properties was a very low ‘D’ (SAP 57.6) compared to a very high ‘D’ (64.6) for social housing. But this higher figure hides a multitude of sins. If the 2030 and 2050 milestones are not to be missed by a country mile, it is reasonable to assume this: targets, regulation or a combination of the two will be brought to bear on social landlords in the next 5 years. Landlords can get a stock analysis (such as CROHM) done to understand where fuel poverty is happening and how it can be tackled cost-effectively. No excuse to delay – and every reason to start planning.

We have helped analyse over 370,000 homes.  If you want help with understanding your homes and which measures can most cost effectively reduce fuel poverty a CROHM assessment may help.  For instance a number of clients have requested us to illustrate the cost and the measures involved in getting to an EPC of C or an average EPC of B.   This assists significantly with investment planning.

Topics: Registered Social Landlords, Retrofit, Fuel poverty, Housing Associations, Energy

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