Making the vast majority of the UK’s homes energy efficient will require £167 billion of government investment over the next 20 years, a coalition of construction industry bodies and companies has told Kwasi Kwarteng.
In a letter to the secretary of state for energy and business, the Construction Leadership Council (CLC) has outlined a four-phase plan to retrofit the UK’s housing stock, which it says are currently responsible for a fifth of carbon emissions and 35 per cent of total energy use.
The construction industry umbrella body’s revised National Retrofit Strategy, which is currently out for consultation, says the “vast majority” of the UK’s existing 28 million homes must be retrofitted in order to be compatible with the government’s emissions reduction targets.
The strategy estimates that a £523.7 billion programme will be required to bring 27.3 million homes up to the net zero standard by 2040. Of this, it says the government investment would be £167.6 billion with the rest supplied by private capital.
However, the jobs and economic activity generated by this programme would generate £387.6 billion of revenue for the government, reaping a tax benefit of £1.84 for each pound of investment from the public purse.
Other benefits would include a £436 energy bill saving per home on average per year, increasing average household disposable incomes by two per cent.
The report estimates that warmer homes could also lead to 6,000 avoided deaths per annum.
The letter says that £5.3 billion of government investment during the current Parliament would help to retrofit 855,000 homes and create 100,000 jobs by unlocking a further £11.4 billion of private capital. The government investment works out at just over £6,000 per property.
The CLC advocates that the retrofit programme should start slowly in order to build up capacity within the construction industry’s supply chain. It should then peak during the middle of the next two decades before ramping down toward end of this period as the hardest to treat properties are tackled.
The strategy recommends the establishment of a central Retrofit Delivery Agency to oversee the programme.
Brian Berry, chief executive of the Federation of Master Builders and chair of the CLC’s repairs and maintenance group, said: “The National Retrofit Strategy is a blueprint for making green home upgrades accessible to all British households. This will help make our homes more comfortable and cheaper to run.
“This strategy also has the potential to unlock 100,000 new jobs and save 2.53Mt of carbon dioxide in the first four years, in return for £5.3 bilion of government investment. This will support the levelling-up agenda, helping us to build back better and greener.”