Social housing landlords are currently facing some of the most challenging times to date. Skyrocketing energy prices and the wider cost of living crisis mean that tenant wellbeing is more important than ever, with this set against a backdrop of needing to tackle climate change and meet government and local decarbonisation targets.
As I write this, Ofgem has just announced the energy price cap rates that will come into effect in October. Unfortunately, when extrapolated out into real-world energy bill scenarios, they provide some alarmingly high price increases that will present real issues for millions of UK households, particularly those on lower incomes.
To give some context, a resident of a three-bed semi-detached home EQUANS is currently working on as part of a Social Housing Demonstrator Fund (SHDF) project was paying £1,552 per annum with March’s price cap. Based on October's new rates, they are now facing a bill of £4,069 for the same energy usage - a rise of £2,517 in just six months (or £209 per month)!
Luckily for this resident, they're having extensive whole-house retrofit work carried out, so their post-project annual energy bills (based on October's new price cap) are expected to be £2,193 - a saving of £1,876, but still up £641 from what they were paying in March, despite having extensive retrofit work and reducing their energy consumption by half!
Decarbonisation doesn’t always go hand-in-hand with tackling fuel poverty - just look at the difference in the gas and electricity prices - so it’s important for social landlords to take a holistic view of retrofitting their housing stock - with the resident at the very centre of those plans - and look at a ‘whole house approach’.
This doesn’t necessarily mean doing everything in one go - albeit this would be preferable if financially viable - but more about having a plan and strategy for how you will go about decarbonising a property over a period of time, in a way that fits into wider asset management plans, whilst at the same time not increasing fuel bills.
One local authority doing just this is Rotherham Metropolitan Borough Council, which declared a climate emergency in 2019 and has since pledged to get carbon emissions in the borough to net zero by 2040.
We are working with the council to carry out critically important retrofit work to social housing stock in Maltby, a former mining town with some of the UK’s highest levels of fuel poverty.
EQUANS assisted the council in securing £1.5million from the Government’s SHDF towards the project, which will serve as a pilot to retrofit other homes in the borough.
The 141 homes to benefit from the measures are traditional cavity brick-built, which is typical of Rotherham’s housing stock and can therefore help to shape the future borough-wide net zero carbon specification. Maltby falls in the top 10% most fuel-poor areas in the UK, and current EPC ratings on the selected properties range from C to G.
As well as fabric improvements, including external wall insulation, loft insulation, triple glazed windows and energy efficient doors, the retrofit works have been coordinated with the council’s planned re-roofing programme, in order to maximise delivery savings and minimise disruption for residents.
This vital project is expected to save more than 96,000kg of CO2 per year, while also helping residents reduce their energy bills by an estimated £461 per annum, based on October’s price cap rates.
With energy costs set to continue to rise, it’s clear that the challenge for social landlords to get the balance right between decarbonisation, addressing fuel poverty, and working out how to pay for costly retrofit works is now more important than ever.
Paul Walsh, Rotherham Council’s Interim Assistant Director for Housing, said: “Initiatives like this are a crucial part of the Council’s housing strategy, and speak to the challenges that we recognise around the cost of living, but also the cost to the planet. The efficiencies that will be saved through schemes like this one will make a huge difference to people’s lives, while also encouraging sustainability long term. We are now looking at how we can extend this good practice in other parts of the borough.”
This article originally featured in "MJ".