In our last post, a few days ago, we asked ‘How will Birmingham City Council fund retrofit to make Council homes warm?’ But the West Midlands Combined Authority is also planning to fund retrofit, and this might include some homes in Birmingham. They say “The WMCA has brought in c. £11m of retrofit funding, amongst a wider total of £67.66m won by our constituent local authorities.” It doesn’t say for how many homes. And now the WMCA are bidding for Government grants worth around £40million to retrofit over 2000 homes.
What percentage of fuel poor homes in the WM would this retrofit?
This would enable an average of £20,000 per home. So the total of the £11m funding already secured by the WMCA plus the new bid would retrofit approximately 2,500 homes. To put this is context, there are 235,512 fuel poor homes in the West Midlands according to the WMCA’s ‘Five Year Plan’. 2,500 homes is about 1% of that.
The ‘Five Year Plan’ promises “to retrofit 292,000 homes by 2026 to stay on course for net zero”. How much will this cost? “The WMCA estimates the investment required to 2026 to fund the Five Year Plan as … £3,853million.” How much funding has the WMCA got up till now? £11m plus a bid of £40m. There will be more Government grants available for home retrofit, but they are nowhere near the sums needed.
How to get the building industry to get retrofit done
The WMCA’s ‘Five Year Plan’ relies not on Government funding but on “developing investable propositions to stimulate the market”. The problem is that this investment is not forthcoming, as the WMCA report ‘Environment Behaviour Change Update’ on 9 March 2022 explains: ‘“Energy infrastructure spending is not aligned with local economic priorities which is proving a significant barrier to business investment.” In short, the market won’t invest in retrofit on a large scale because they don’t think there’s enough profit in it.
The UK Green Building Council (UKGBC) is “an industry network with a mission to radically improve the sustainability of the built environment, by transforming the way it is planned, designed, constructed, maintained and operated.” In October this year it published a 26 page document – the ‘UKGBC Response to Net Zero Review: Call for evidence’, which is very critical of Government policy:
Our membership firmly supports greater government action to accelerate the UK’s net zero transition.
Current rates of renovation will need to increase by around 7 times if we are to meet the Government’s target of upgrading as many homes to EPC Band C as possible by 2035.
What challenges and obstacles have you identified to decarbonisation?
Stop start government policy
Cycles of ‘stop-start’ government policy have inhibited decarbonisation in the built environment and associated business growth. The industry requires long term certainty and signals to support decarbonisation and green investment at scale. Disruption associated with policy cancellation, delay and/or reduced ambition has held back the economic and investment prospects for the sector, particularly in relation to retrofit and energy efficiency and higher standard new buildings.
A lack of clear, ambitious trajectory in regulation has inhibited the development of key low carbon products at scale, and associated investment.
Lack of capacity amongst local authorities
A lack of capacity at local authority is a significant barrier to the burgeoning net zero built environment industry both in planning departments and retrofit officers.
It is critical that Government therefore introduce and support a large-scale, transformative domestic retrofit strategy and programme that is fully coordinated with local authorities, industry, consumers and other relevant stakeholders, and does not disadvantage lower-income households.
The reality is that without massive business investment in retrofit the life-changing reductions in home carbon emissions and fuel poverty that are urgently needed in the next few years simply won’t happen. And business won’t invest without a radical increase in Government support including large-scale financial incentives, ensuring sufficient profit.
So the urgent question now is what will the WMCA do to get Government to act? The CA’s new ’Fuel Poverty Discussion’ document says this:
Current funding provision is sporadic, piecemeal and usually short-term. Bidding and a diverse set of reporting and administrative requirements also consume a significant proportion of the limited resources we have as a region to address fuel poverty. To address this, WMCA is pushing for action in three key areas as part of its negotiations with government for a Trailblazer Devolution Deal: 1. Establishment of a long-term Retrofit Commissioning Framework to simplify funding, reduce the admin burden and make it much more flexible. 2. Targeted innovation funding to support development of supply chain capacity and demand 3. Development of training and skills provision.
So the CA acknowledges the failure of Government policy. But the actions it wants from Government fall far short of what is urgently needed – there is no call for a huge increase in Government funding to get the retrofit industry to work to achieve the WMCA’s retrofit targets on behalf of the people of the West Midlands. Climate campaigners are calling on Mayor Andy Street to publicly demand full Government funding and to campaign for it, mobilising popular pressure on Government. This would gain overwhelming public support. His refusal to do so shows that his loyalty is to the Tory leadership rather than to the citizens of the West Midlands who he is supposed to represent.