Civil Engineering Reference
In-Depth Information
terms, these now significantly outperform new buildings built to the highest energy
conservation standards. On the basis of this evidence, the Federal Housing, Urban
and Transport Ministry has announced an ambitious energy reduction programme
to upgrade all pre-1984 properties in Germany by 2020. Using a system of loans,
grants and tax incentives, the scheme will cover an estimated 30 million units of
all kinds (including schools, public offices and residential buildings). The retrofit
building upgrade programme will make a major contribution to Germany achieving
its ambition to reduce overall carbon dioxide emissions by 40 per cent by 2020
(Powers 2008).
In the UK, through the Energy Act 2011, the government set up a similar, but
less ambitious, scheme to improve the energy efficiency of British properties. The
so-called 'Green Deal' is forecast to bring about a cut of over 2 million tonnes in
carbon dioxide emissions a year. The underlying principle is simple enough - energy
efficiency measures, such as loft insulation and heat pumps, will be undertaken by a
private firm at no upfront cost to the consumer, and the payment for the work will
be recouped over time through charges added to that consumer's energy bills. The
policy's 'golden rule' is that energy efficiency measures can only be provided if the
expected savings on the fuel bills are greater than the charges to pay back the cost of
the work within a maximum 25 year time frame.
So at the heart of the government's Green Deal is an innovative financing
mechanism that allows consumers to pay back the cost of energy efficiency
improvements through their future energy bills. If the resident moves out and
ceases to be the energy bill payer at that property, the financial obligation transfers
to the next bill payer at the property. In this way, the Green Deal differs from the
conventional top-down government programmes based on tax incentives and grants
as it is in effect a loan funded by private capital.
Alongside the Green Deal sits another legislative proposal that, from April 2018,
private rented properties must be brought up to a minimum energy efficiency rating
of E. It will be unlawful to rent out residential or business premises that do not
reach this minimum standard. In short, owners of energy inefficient buildings (those
that are F or G-rated) will need to undertake measures to improve the performance
of their properties. The Green Deal, together with the E rating for rented property,
should impact on the nature and scale of building refurbishment projects as the
measures incentivise residents and landlords to improve the energy efficiency of
existing buildings.
This increasing focus on the energy performance of buildings reflects the widely
accepted view that the property sector can play a key role in reducing carbon
emissions. The International Panel for Climate Change (IPCC 2007:
Chapter 6
)
noted that in comparison to other economic sectors buildings offer significant
opportunities for cost-effective improvements to energy efficiency, thereby reducing
demand for heat and power in line with international energy strategies. A focus
on buildings would allow governments to exploit what the panel referred to as the
'low hanging fruit'. Extending this analogy further, some reviewers have noted that:
'Once the Green Deal “carrot” is on the table, landlords can face the threat of being
unable to let their properties if they refuse to eat it' (Mactavish et al. 2012: 50).
