Lobby group calls for £5,000 cap on efficiency improvement work in private rental sector

An energy efficiency lobbying group has said new government guidelines should help to bring more than 300,000 private rented homes up to standard on energy efficiency by encouraging landlord investment.

The comments from the Association for the Conservation of Energy (ACE) come ahead of the publication of government guidelines, which will set out how around 330,000 privately rented homes that do not currently meet minimum energy efficiency standards can be brought up to scratch.

Speaking to Utility Week, ACE said it supported the requirements for landlords to implement energy efficiency measures “provided the cost is not too great”, as that could allow them to claim an exemption from adhering to standards.

ACE has proposed a cap of £5,000 for energy efficiency improvements. It also said compliance with new domestic energy efficiency standards could cost many landlords as little as £600 per home.

“Currently, landlords don’t have to pay for any regulations that are formed, they only have to comply if they can find the funding, for example from local authorities,” explained ACE chief executive Joanne Wade. “It would be less hassle just to pay for the products to make energy more efficient, as opposed to looking for exemptions.

“How landlords should spend £600, would depend on how to get their energy performance ratings higher. This could include better heating control rafts, replacing windows and loft insulations. We are not asking for major work to be done.”

Wade added that investing in energy efficiency measure should bring benefits to landlords.

She noted that detail on the extent of these benefits “have not been advertised as yet,” but reasoned: “If landlords were to make their properties more energy efficient, they would make their properties worth more, be easier to let, and improved standards would lead to a lower turnover of tenants.”

ACE also highlighted the difficulty landlords can have in accessing finance for improvements. It cited schemes such as the Green Deal Finance Company as a helpful source of energy efficiency funding.

Wade added: “Looking to the next budget statement, I think that we need to provide longer term incentives to landlords that what are currently on offer, and stop the staccato progress on incentives.

“For example, a policy of zero rated VAT for implementing energy efficiency measures could be introduced. To boost the link between a higher level of energy efficiency and higher quality apartments.”

ACE also suggested that local authorities are best equipped to act as enforcement agents for any new regulations, but Wade said that they must be adequately resourced, so that they can implement them robustly. 

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