The government response to the Public Accounts Committee report on the green homes grant voucher scheme, published on 24 February 2022, discussed a number of lessons. IPSOS is also undertaking an independent evaluation, due for publication in autumn 2023. The heat and buildings strategy sets out the actions that we will be taking to reduce emissions from buildings and provides the long-term framework to enable industry to invest and deliver the transition to low-carbon heating.
My Lords, I thank the Minister for her reply, but I am sure she will agree that the failure of the green homes grant, which was eventually scrapped, was largely due to the lack of skilled and trained workers in the construction industry to undertake the work needed. Should not the short-term measures that were involved in the green homes grant be replaced by a genuine long-term funded strategy that emphasises training and skilling? Does she agree that, without that, it is very likely that we will not achieve our decarbonisation targets, and fuel poverty will go on increasing?
I could not agree more with the thrust of the noble Baroness’s question. The heat and buildings strategy is designed to provide a long-term framework for these initiatives. We are investing £2.5 billion in a national skills fund to support the immediate economic recovery and the skills needed to deliver on our net-zero targets, and we invested £6.9 million alongside the green homes grant voucher scheme to deliver over 8,000 training opportunities. We are continuing to work with businesses and key industry bodies and have launched the Green Jobs Taskforce to produce an action plan for just this sort of initiative.
My Lords, there are said to be some 23 million existing homes with gas boilers, although some people believe that the figure could be very much larger. How long will it take to tackle the conversion of all those to heat pumps or hydrogen? What is it going to cost? Is this really the best way of contributing, as we must, to tackling rising global emissions?
My noble friend will be aware of the boiler upgrade grant scheme, which was just launched in May. That will provide capital grants to support the installation of low-carbon heat technologies away from fossil-fuel heating. As for how long it will take to replace all those heat boilers, it will take time because, as my noble friend says, the task is enormous—but we are investing £6.6 billion over the course of this Parliament to improve energy efficiency and decarbonise heating.
My Lords, can the Minister assure the House that future government initiatives for reducing greenhouse gas emissions from buildings will also include climate adaptation measures such as addressing overheating and poor indoor air quality, as recommended by the Climate Change Committee?
The noble Baroness makes a very good point. These questions are really for the Department for Levelling Up, Housing and Communities, but the Government are committed to the new home standards and there is a review of building regulations under way, which is probably the best route, rather than legislation.
My Lords, it is the retrofit industry that is able to deliver the Government’s often-repeated target of getting all fuel-poor homes to EPC band C by 2030. But, having been let down so many times, that industry says it would be much more likely to invest in equipment and training with the certainty provided by putting that target into legislation. Can the Minister tell us why the Government refuse to do that?
I cannot answer that specific point but, if the noble Lord had been present yesterday at the University of Birmingham’s presentation on this, he would understand that a lot of what it discussed was in exactly this area. It went on to say that more power should be devolved to local authorities to bring forward the retrofitting of buildings. But companies like Vaillant and Cadent are doing an awful lot of research into retrofitting and adapting to the future possibility of using hydrogen in the heating system, which will also help to decarbonise it.
My Lords, I will pick up on a point from the noble Baroness, Lady Blackstone. It is estimated that only one in six manage to secure tradesmen qualified to install under the green grant scheme, which is an extraordinarily low figure. How do we know that it will improve? What measures are the Government bringing in to improve it, and how will we measure that?
That follows on from my answer to the noble Baroness, Lady Blackstone, about how we are trying to improve supply chain capacity and upskill the workforce. We learned these lessons from the failure of the green homes grant scheme—there simply were not enough qualified technicians to install under the necessary upgrade schemes. The boiler upgrade scheme was specifically designed so that installers would be able to invest in their workforce to increase the capacity for the market to make those sorts of changes.
My Lords, I press the Minister on the response that she gave to the noble Baroness, Lady Blackstone. I declare an interest as chair of the National Housing Federation. Housing associations face real challenges, in terms of both strategic funding and, in particular, green jobs and skills. I press the Minister on the timing: what progress has been made by the green skills taskforce in producing an action plan, and when does she expect it to be published?
My Lords, in the interests of future-proofing against the need for retrofitting, does the Minister agree that, as well as a long-term retrofit strategy for existing buildings, we also need to introduce building regulations on targets and reporting for embodied carbon to ensure that developers consider this in all construction projects, as recommended by the Part Z campaign, which enjoys considerable industry support?
My Lords, has my noble friend reviewed the pilot study carried out by the chief scientific adviser to the DCLG in 2019 on retrofitting a sample of social houses? It found that the average cost of doing this was £85,000 per house, but the reduction in emissions was only 60%. If scaled up nationally and if we take the heroic assumption that costs will be reduced by a factor of three, it would still cost £1 trillion. Have any of the proponents of retrofitting suggested where this money will come from?
I draw my noble friend’s attention to Selly Oak’s project to retrofit many of its poor council houses. This is under way at the moment, but it seems to be having a much better result than the examples that he has just cited.
My Lords, buildings are responsible for about 30% of primary energy use in the UK and nearly half of all carbon emissions. As we have heard, the Government’s failures with the green homes grant and the absence of efficiency measures in the energy security strategy, including the crucial issue of retrofitting, suggest that they have little idea of how to tackle this significant issue. Can the Minister tell us what measures we will see in the upcoming energy security Bill to show that lessons have finally been learned?
I do not think that anyone could disagree that we learned a number of lessons from the failure of the green homes grant—but we need to understand that its primary objective was to upskill the workforce and support jobs after the pandemic, as well as to drive forward the net-zero agenda for this Government. We learned that a limited number of installers were registered, although we did install 47,000 upgrades. We also learned that the 12-week timescale was insufficient to produce a meaningful scheme, and we did not do enough consultation before introducing such a complex scheme. But those issues have been addressed, and the whole heat and buildings strategy needs to be seen in the round—it sets out the long-term objective, and the upcoming energy security Bill is just a part of that overall objective.
There is no one-size-fits-all approach to tackling the UK’s diverse housing stock—that is part of the problem. Successfully delivering a retrofitting scheme has to balance a number of variables, including complexity, choice, value for money and quality assurance. It also has to address some of the fraud that took place in earlier schemes. The “fabric first” approach to retrofitting buildings before installing heat pumps is sensible, but it has a much longer-term time horizon, which also adds to the complexity of the scheme. Do not forget that, over the past 10 years, the Government have been successful in delivering a number of schemes, such as the energy company obligation, the renewable heat incentive and the green homes deal improvement fund. Over that timescale, we increased the number of houses with energy rating C from 14% to 46%.