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Carbon emissions from UK homes are expected to be cut by
29% over the next 10 years under the 'Warm Homes Greener
Homes' strategy announced by Communities and Local
Government (CLG) and the Department for Energy and
Climate Change (DECC) in March 2010.
The strategy sets out
plans to carry out the following works:
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The installation of
loft and cavity wall insulation in all homes, where
practical, by 2015; and
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Installation of 7
million more ambitious eco-upgrades, such as solid
wall insulation, air source heat pumps, ground
source heat pumps and solar thermal technologies by
2020.
An initial estimate of
the costs of standard and solid-wall insulation is £18.6
billion, falling over the period 2013 – 2020 (with an
anticipated even annual spread).
How will the reduction in
emissions be funded?
Energy companies who are
currently legally obliged to fund carbon reduction
measures under the Carbon Emissions Reduction Target
(CERT) would meet approximately two thirds of the
overall costs.
From 2013 a new
obligation (currently under development) will be put in place,
requiring energy companies to work with local
authorities. These
local partnerships are expected to result in energy efficient works
being delivered more efficiently, e.g. within existing programmes of work.
The remaining funding is expected to come from
'green loans' based on a 'Pay as You Save' model,
covering the cost of more expensive measures such as solid wall
insulation, where installation costs on average around
£8,000. The government envisage these will come
from traditional borrowing sources, will be spread over
several years and will be tied to a property, not an
individual. The resulting savings on energy bills
are expected to cover repayments.
How will social
landlords and suppliers benefit?
Social landlords and
their suppliers are
likely to
benefit from support under the new energy obligation, as
they provide economies of scale and can roll out
improvements in conjunction with existing work programmes.
All social tenants or those living in blocks with a
social landlord freeholder will benefit from
priority group treatment under the new obligation, until
the end of 2015 at the earliest.
The new Warm Homes
standard, which will be developed in detail this year, will supplement the Decent Homes Standard,
covering insulation, installation of smart meters,
micro-generation schemes, water efficiency measures and
the replacement of fossil fuel heating. Connection to low carbon district or
renewable heating schemes will also be covered where feasible.
The aim is to achieve the Warm Homes Standard by 2020.
Opportunities within the
social housing sector
Given that the strategy goes
to plan, the Government foresees, on the basis of
assessments so far that the social housing sector should
achieve:
By 2015:
To be installed in over
300,000 social housing units (with perhaps 100,000
social housing units treated in 2015 itself)
By 2020:
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Where social landlords
secure support, the installation of all remaining solid
wall insulation in the social housing stock, with the
potential for up to 700,000 treated in total.
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