From speaking to landlords, we know that their greatest obstacle (and simultaneously, their greatest motivator) on going green is regulation. Postponing stricter energy efficiency requirements would be a mistake – jeopardising both the Government’s commitment to net zero and better housing.
In 2013, David Cameron decided his government needed to “cut the green crap” and removed grants for home energy efficiency improvements. Insulation rates of British homes fell off a cliff. We’re still nowhere near insulating as many homes as we did a decade ago, and it seems that another “cut the green crap” moment might be coming. Earlier this week, the Government indicated its intention to push back increases in minimum energy efficiency requirements for private rented sector landlords, worrying that it would be expecting too much too soon of landlords.
The private rented sector is the worst performing tenure for energy efficiency in the UK, with the highest proportion of non-decent homes. Renters in private sector households live with some of the most drafty and leaky properties, paying more for their bills and with little ability to improve the energy efficiency of their homes. All private rented sector properties must meet a minimum energy efficiency standard (MEES) before they can be leased. This is currently set to an E rating on an A-G scale with A being the highest rated. A government consultation on energy efficiency in the private rented sector closed in 2021, with a recommendation for the MEES for the PRS to be raised to a C from 2025 for new tenancies, and 2028 for existing ones. The suggestion that those targets are likely to be weakened is unsurprising, given that the Government has failed to respond to the consultation, even though it closed two and half years ago. We should be shocked, however, at the Government’s readiness to drop what is likely the most effective measure of ensuring better housing conditions for 19% of the population.
In March of this year, our report Lagging behind (first in a series on decarbonising home heat) examined attitudes to energy efficiency in the UK. Our survey found that private rented sector landlords expect a bigger government subsidy than owner-occupiers before they are willing to spend their own money on insulating their properties. Since then, we’ve been digging deeper into the barriers that landlords in particular face to making their rental properties more energy efficient. While there are some concerns around cost and uncertainty on what measures to take, the greatest obstacle for landlords (and simultaneously, their greatest motivator) is regulation.
Those landlords that have taken energy efficiency measures in recent years have often done so in anticipation of changes to minimum energy efficiency requirements, and a desire to act sooner rather than later so as to avoid scrambling for contractors. Conversely, landlords that have not acted typically justify their failure to insulate their properties on the basis that they meet the current minimum standard. Many we have spoken to say they won’t be motivated to change until those requirements are tightened. Even if a new standard was announced, some landlords would wait to see if it actually comes into effect before moving. This week’s uncertainty will only have undermined the Government’s credibility and added to the numbers sitting on the fence.
The MEES requirement is therefore a very strong tool, and the most viable one that government can use to improve energy efficiency standards in the private rented sector. The Government is correct that landlords need more support to improve the energy efficiency of their properties. They need to know what to install, where to find the trusted traders to install them, and what financial support (if any) is available. The Government is mistaken, however, if it believes that delaying MEES requirements will help. Rather than giving landlords more time to adjust, the likelihood is that delaying regulation gives landlords further excuse to procrastinate. Such time wasting is toxic not only to the country’s commitment to net zero by 2050, but also to the Government’s ambitions for better homes.