How will Birmingham City Council fund retrofit to make Council homes warm?

The Social Housing Decarbonisation Fund (SHDF) Wave 2 is money secured by councils from government to fund their own retrofit programmes. At the Birmingham Cabinet meeting on 8 November 2022 it was agreed that the Council would apply for grant funding of £23.3m, of which £19.9m would support the retrofitting of 2,231 Council homes, for which BCC “would be committed to funding the remaining £129m of the works to enable each property to achieve the required energy efficiency rating of EPC C”. Up to £99m of the £129m would come from the Council’s Housing Revenue Account (HRA), with the remainder from additional Capital Borrowing.

The 2,231 homes would be split into 9 different schemes, consisting of a range of types of properties. The retrofit would “consist of external wall insulation, cavity wall insulation, ventilation, loft insulation and double glazing”. But the grant is capped at £10,000 per property, and it does not include replacement of gas boilers.

There are about 60,000 Council homes in Birmingham. 2,231 represents about 3.7%.

How much retrofit per home will the funding pay for?

In July BCC announced plans to retrofit 300 properties costing £27m in East Birmingham as part of the 3 cities retrofit programme. That works out on average at £9000 per home. How do these figures compare to the cost of retrofitting?

Comparison is complicated because it depends on the type of home and the choice of retrofit actions, but according to the 2017 BEIS (Department for Business, Energy, and Industrial Strategy) publication ‘What does it cost to retrofit homes?’ estimates for a small semi-detached house for internal solid wall insulation are £5,000 – £10,400 and double glazing £4,800 – £7,000. The BEIS doesn’t mention replacing gas boilers with heat pumps but the ‘Homebuilding and Renovating’ website (June 2022) suggests a cost of between £2,500 and £4,000.  So the total cost of these three measures alone would be between £12,300 and £21,400. These estimates don’t include measures such as loft insulation and underfloor insulation. And they don’t include VAT.

Half a retrofit

The lowest estimates significantly exceed the £9,000 that is being offered on average by Birmingham Council. It looks like what the Council is offering is only half a retrofit. Out of the 9 small-scale schemes only one – Bromford – includes the replacement of gas boilers, which, as Jess Ralston, analyst at the Energy and Climate Intelligence Unit, said, “contribute to harmful air pollution in homes that are already more likely to have poor air quality [and] means that fuel-poor families are locked into dirtier, more expensive and more unhealthy heating systems for longer.”

Which BCC Cabinet Member is responsible for getting the retrofit mess sorted out?

The whole retrofit issue is bedevilled by lack of funding and chaotic organisation. But bizarrely the Council has decided to split the responsibility for sorting it out between two different Cabinet Members. Cllr Majid Mahmood has the Environment portfolio and is accountable to the Sustainability and Transport Overview and Scrutiny Committee. Cllr Sharon Thompson is the Cabinet Member for Housing and Homelessness and is accountable to the Housing and Homelessness O&S Committee. Both state that retrofit is one of their priorities. Neither mention the other, or how they are going to work together. This is a recipe for disorganisation which the Council needs to urgently sort out.

Read the regular posts on Retrofit on the Birmingham Against the Cuts blog, and follow Climate Action Network West Midlands and the West Midlands Climate Coalition on Facebook

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