“Doing the same thing over and over again and expecting different results….”
Whether or not we can thank Albert Einstein for that quote or not, it feels pertinent here nonetheless.
The latest assessments from the IPCC on climate change are alarming, showing that the next 12 years are critical in mitigating the most significant changes. Last week a Committee on Climate Change report was published showing that nationally, our progress towards reducing emissions associated with our homes is stalling. Now is the time to question how we are approaching these issues and whether more of the same approach is what we really need.
Domestic buildings contribute 14% of UK GHG emissions annually and to meet our legally binding targets, this contribution needs to fall to virtually zero by 2050 – a mere thirty years off on the horizon. Current projections are that the building stock in 2050 will comprise of approximately 5 million new homes yet to be built, and a staggering 29 million homes that are already standing. Progress towards making both chunks of stock zero carbon is limited: new build Zero Carbon Homes were abandoned in 2015 and our current system for measuring the performance of new and existing homes is flawed in many ways. “You can’t manage what you can’t measure” is the adage of many, including energy managers across the country petitioning for better systems to control the energy costs of large buildings and institutions. The problem with our homes is that we don’t measure energy performance, we estimate it based on actual (new build) or assumed (existing stock) construction details and some assumed patterns of behaviour. A newly built home might have the appropriate cavity wall insulation, but just because it is present, does not mean it has been installed in a way that delivers the performance it should. Equally, a new home may well pass an air pressure test on completion, when all the silicone and caulk is fresh, but six months down the line, when the building has settled and the sealants have cracked, energy consumption is likely to have increased significantly as more and more ‘natural ventilation’ of the home takes place. Those involved in Passivhaus know this, which is why they pay painstaking attention to every junction, light fitting and opening in the building envelope, to ensure it is sealed not just to pass a test but for the lifespan of the building, so that it performs. But doing that costs more money.
How do we address this issue? We measure, then we can manage.
Our only yardstick for the performance of our building stock is the Energy Performance Certificate (EPC). The dimensionless ‘A’ to ‘G’ rating of an EPC seems like a good idea – a simple measure that anyone can understand, ‘A’ is good, ‘G’ less so. However, this dimensionless rating is a compound measure of how much energy a building might use, and the cost of the fuel used to deliver this.
If we take an example home needing 12,000 kWh a year to heat (the current average according to Ofgem), it might be rated ‘C’ if it has a gas boiler, ‘D’ if it has an oil boiler and ‘F’ if it uses direct electric heating. This is because gas is relatively cheap, oil a bit costlier and electricity relatively expensive. Under the current version of SAP (the methodology used to calculate ratings) there is a relatively close link between the cost of these fuels and their carbon emissions, so in our example the best rated house has the lowest carbon emissions, and the worst rated the highest. So, SAP is a measure of the cost of delivering the estimated heat demand.
However, as we all know, electricity has rapidly decarbonised in the last decade. The latest version of SAP will reflect this when it comes into force in the next year or so. This change, combined with low oil prices, will have the perverse impact that our three example homes will now have ratings largely decoupled from their carbon emissions.
This makes me question whether current government ambition (launched as part of the Clean Growth Strategy in 2017) to move as many homes as possible to a ‘C’ rating, make any sense at all?
The cost of heating a home is clearly important, with many in fuel poverty choosing whether to heat their home or eat and there is no question that energy costs should be front and centre of policy. It is important to acknowledge however that we are using a common metric to address both fuel poverty and carbon emissions, and that this metric is only appropriate to achieving one of those aims.
Smart metering, bringing with it half hourly settlement and more accurate energy bills is the first step to measuring performance. This could (and should) be used to inform and update the Energy of buildings, to show real world energy use. A couple of years’ worth of real data being published would have an impact on the new build market, I don’t doubt.
If we can improve measurement, how do we manage our emissions to work towards zero?
We have the solutions, we can build zero carbon homes and we can retrofit homes to be virtually zero carbon. Unfortunately, very few people want to do this, and of those that do few are in a position to invest in/cashflow it.
In the last decade the Netherlands has seen the exciting development of the ‘Energiesprong’ retrofit approach, delivering performance-guaranteed zero energy retrofit in a quick and appealing manner. Regen are currently involved in a pilot demonstrating this in the UK, and I have spoken and written about this extensively elsewhere so check my other blogs. A key enabling factor in the Energiesprong approach being successfully delivered for both retrofit and new build in the Netherlands has been a change in the law, allowing landlords to charge an energy performance fee (known as an EPV). Simply put, if a landlord builds or retrofits a home to have very low demand for heating (less than 50 kWh/m2) and incorporates enough renewable generation to equal this, they can charge the tenant a fee to recoup the capital costs of the work.
This fee is varied depending on how efficient the home is and has a ceiling such that the cost of occupation is no higher than before.
What does this deliver?
- The tenant has the same or lower costs of living, buffered from fluctuations in energy costs as they now use less of it, and most significantly, they have a comfortable and desirable home to live in.
- The landlord now has a more valuable home, which will require lower maintenance, they can recoup the capital costs of the additional efficiency measures and their happier more comfortable tenant is more likely to keep up with payments and continue to live in in their home.
- Nationally (globally), carbon emissions are reduced, fuel poverty related issues are reduced
This, to my mind, is the missing incentive that our housebuilders and landlords need to deliver homes that perform to a very high standard. If we build an industry around this, that can consistently deliver guaranteed performance, it will unlock the market to the 60% of our housing that is owner occupied but currently unconvinced about the added value of a low energy home compared to the hassle of achieving it. If we can manage to get 80% of our homes double glazed, when the financial payback is around 100 years, then we can achieve zero energy homes. We simply need to recognise the other benefits and enable the mechanisms that deliver them.
What we are doing is clearly not delivering significant enough change, we have been trying over and over again and we are not seeing different results. It’s time to measure the actual performance of our buildings and support mechanisms, such as new finance mechanisms, that will empower building owners and the industries supporting them to deliver radical change.