Paula Higgins: British homeowners are vital to reaching net zero. But we must ensure climate targets are achievable for them.

2 Jul

Paula Higgins is the CEO and founder of HomeOwners Alliance.

As focus moves from setting to delivering the UK’s world-beating climate targets, our homes have moved to the centre of the debate.

Insulating millions of houses and replacing polluting gas boilers with cleaner alternatives is essential to reaching net zero and will require the buy in of the vast majority of the British homeowners. As such, it is essential that there is a practical, consumer-friendly, and affordable means of cutting carbon from domestic life.

It has been suggested that homeowners should be required to upgrade the energy efficiency of their home before putting it on the market. This is a complete non-starter for a number of reasons. For many sellers, they will not have the cash, time or energy to upgrade their home before moving on. This is especially true for downsizers.

But this doesn’t mean that there isn’t a route to net zero for our homes.

Instead of punitive regulations, which will more than likely lead to shoddy work and disgruntled homeowners, there are dozens of policies, tax changes and other levers that government can pull to climate proof our homes.

First place to look is the recent Green Homes Grant, which despite many flaws, showed that there is huge public appetite for upgrading homes. At HomeOwners Alliance we were overwhelmed with questions and requests for more information about the scheme. It’s nonsense for the Government to use the excuse as a lack of take up to axe the scheme.

Hopefully this should give ministers confidence to deliver a big and improved demand-led scheme, allowing Brits to make upgrades to their homes at a time that suits, instead of being forced into it when looking to move. A drop-in replacement for this popular scheme is a no-brainer.

The tax regime is also weighed against home improvements that will decarbonise our homes. Home improvements are expensive. Add on VAT at 20 per cent and you can see why our research reveals one third of homeowners are deterred from doing home improvements at all, or forced to pay cash to afford the work. The zero VAT rate for new homes should be extended to homeowners undertaking major refurbishment works and efficiency upgrades.

Changing council tax and stamp duty to free up cash for greening our homes, either through rebates, reduced rates or cashback schemes could also be a vital step towards net zero.

There is precedent to changing stamp duty to achieve wider goals, as seen in the pandemic recovery. With net zero as one of the government’s core tenets, there is surely scope for doing it again, especially with such enthusiasm from Brits about cutting carbon footprints.

Another option is interest free loans, comparable to those issued more than two million times in Germany and on offer in Scotland, are yet to be made available across the UK.

For it to be worth its salt, the Government’s upcoming strategy to decarbonise our homes need to utilise every option on the table.

Replacing a broken-down boiler with a heat pump currently costs more, but the Government can get involved here too. Energy supplier Octopus is aiming to slash costs for heat pumps by half by the end of next year, but a targeted innovation scheme to cut costs would spur it on with some competition.

We already have a “buildings mission” which aims to halve the cost of efficiency retrofits, why not the same for heat pumps? By setting a challenging goal, not only will costs for homeowners fall, but we can be sure that the UK’s clean heat industry will flourish.

Until prices plummet, following trajectories set by renewable energy sources and electric cars, boiler scrappage schemes can also help with up-front costs, as can schemes such as the £4,000 Clean Heat Grant which should make clean heating more affordable.

Virgin Money and Nationwide are starting to offer green mortgages, offering lower rates for more climate-friendly homes yet crucially not increasing APR for those yet to be upgraded. Greener homes are cheaper to run, so green mortgages can also be flexed to offer additional funds for efficiency upgrades when loans are taken out.

There also will be, as the Climate Change Committee warned this month, a growing number of homes that overheat as our climate warms. Heatwaves this year and last stress the need for new policies and action from government to protect families living in the quarter of English homes that are at risk of becoming too hot in years to come.

Ensuring that Britain’s homes are upgraded for summer warmth, winter cold and clean heat at the same time is vital for keeping homeowners on board. Carrying out upgrades once and ensuring they are done well, ensuring that the numerous benefits are clearly explained and making sure that government support is accessible, easy to understand and effective are all vital for the impending strategy to decarbonise heat and buildings.

There is no doubt that Brits want to take part in the net zero transition, with public enthusiasm for climate action higher than ever. What is needed now is the policies and pledges that make upgrading our homes easy and effective.