Reforming EPCs Will Improve Standards
"Do you know the EPC rating?"
Eyes dart and feet shuffle.
"I'm not sure, I think it’s C... is that good?"
We at UK100 have been banging the drum for EPC reform for years, alongside climate and private renter campaigners, but why is it so important?
Increasingly, for many people, moving house and finding a home generally means renting. The private rented sector has ballooned, increasing 52% since the mid-2000s, as the dream of owning your own home fades into the cold embrace of a shared house with strangers.
In the UK 1 in 5 people rent, and for London it's about 1 in 3. For many, the challenges of finding a house usually fall into these categories: Can I afford it? Is it close to my friends and family? What bus or tube line is it on to get to work?
Rarely does the question EPC ratings come into the picture, let alone what they are.
So it’s no shock that over half private rented houses have a poor EPC rating of D or below. That means not only are many of these houses cold, they're probably terrible for the planet. A climate-conscious renter might avoid air travel and never own a car, but simply heating their home drives up emissions, with little ability to change that impact and because of poor insulation still be cold. It’s even worse for those on fixed incomes, such as young families and older renters, who are more likely to be in housing with poor ratings, and with less financial mobility to move houses and may fear retribution from their landlord if they request improvements. A person living in a house rated D pays £499 a year on energy bills more than in a house rated C.
While a problem for all housing types, the private rented sector is the worst affected with one in four private renters living in fuel poverty (24.1 per cent) compared with 17.3 per cent of social tenants and 8.8 per cent of owner-occupiers. In the rebadged ECO+ scheme now known as the Great British Insulation Scheme, just 14% of grants have gone to homes in the private sector since 2013, with the scheme overwhelmingly being taken up by owner occupiers.
In this context, the government's proposed reforms to EPCs are welcome. Alongside a target of having all rented properties reach EPC C by 2030, the government has consulted the troubled metric itself. The current system doesn't distinguish between gas and low carbon, and for many it is a perceived outcome, not an actual rating of how energy efficient the house performs today. It is vital these reforms make it easier for renters and their local authority to identify how warm a house is, how much it costs to heat, and its carbon footprint. This will enhance the agency of renters and local councils to ask for and expect warmer homes. These changes will stretch out the esoteric EPC ratings into something meaningful for tenants, and give their local authority a better idea of the problems with the housing in their area. These changes will help local authorities identify where they need to target cold homes and focus their retrofit and heat pump programmes.
However, if the government is to collect better information, it should ensure the data is easily accessible. Local authorities are spending millions to identify problem houses in their areas, which leaves little to enforce the standards. Comparing EPC data in the private rented sector across authorities is a herculean task at the moment. A 2020 Freedom of Information request found only 17 out of 248 councils are actively enforcing the current standards. It's not for want of trying, but many simply cannot afford the huge cost to maintain internal teams or hire private firms to collect this data.
The government has announced the Private Renter Sector Database outlined in the Renter Reform Bill will collect energy efficiency data. A regularly updated system across the country will lead to better targeted programmes nationally and locally. While the increased fines and enforcement powers are welcome, unless local authorities have the financial power to hire enforcement officers, it is power in name only.
To allay fears from landlords, the government is proposing to increase the cost cap - the maximum landlords are allowed to spend improving their properties - from £3,500 to £15,000. The previous government consulted on increasing the cap to £10,000, but with volatile inflation, the new government has proposed setting the maximum higher, without increasing it with inflation. The high barrier will lift more harder to improve properties out of the lower bands. It’s estimated the average cost is £6,385.
UK100 members such as Oxfordshire County Council and the London Borough of Haringey have been leading the way to identify cold homes in their areas. The devolution programme will see the strategic authorities take ownership of the retrofit programmes, by building on the knowledge of their constituent members, the UK can align national priorities with local knowledge. Making the metric easier to understand, increasing the cap and creating a national database will drive improvements. However, unless measures are taken to improve the enforcement of capabilities of local authorities, renters could remain in the cold.
