We urge the government to recommit to the their net zero manifesto pledge

Dear Chancellor/Secretary of State

RE: Social Housing Decarbonisation Fund and minimum energy efficiency standards

On behalf of the National Housing Federation and our housing association members across England, I am writing to ask you to recommit to the full £3.8bn Social Housing Decarbonisation Fund (SHDF), as committed in the government’s manifesto, in the upcoming Autumn Statement. We would also welcome a consultation on minimum energy efficiency standards (MEES) in the social housing sector.

Unlocking potential by releasing the full Social Housing Decarbonisation Fund

Housing associations are committed to the vital work of retrofitting their homes, not only to help the country meet its net zero targets, but also to provide energy efficient and comfortable homes for their residents that are affordable to heat.

Funding is crucial to enabling the housing association sector to lead the transition to net zero. The sector plans to invest £70bn by 2050 in the fabric, heating systems and components of their existing homes. However, analysis from Savills estimates that decarbonising all existing housing association homes will require at least an additional £36bn of investment, in addition to the £70bn already planned. This figure is likely to be even higher now as a result of inflation across the supply chain.

The SHDF provides a strong start to filling that gap and we have been very pleased to work closely with your officials on the design of the scheme. We strongly welcomed the £778m awarded earlier this year as part of Wave 2.1 of the SHDF and would like to see Wave 3 come forward imminently to enable social housing providers to continue the good work they are doing to decarbonise their properties.

We would also like to see a long-term commitment to decarbonising our housing stock, by securing the full remaining SHDF beyond 2025 from the £6bn allocated in the November 2022 Autumn Statement. This would unlock supply chains and provide the regulatory certainty for housing associations to plan, contract for and deliver the large-scale retrofit projects required to meet net zero by 2050.

The need for a clear regulatory roadmap for energy efficiency

Many housing associations are already working towards EPC C by 2030, with 69.8% of housing association homes at EPC A – C. A clear regulatory roadmap for energy efficiency standards would help further this work. We would therefore welcome a consultation on minimum energy efficiency standards (MEES) in the social housing sector. Any legislative targets proposed will need to be aligned with housing associations’ current decarbonisation strategies and matched with adequate levels of funding to ensure social housing providers have the resources to meet any new obligations.

A reformed EPC metric would also help to ensure the right retrofit measures are incentivised, facilitating a ‘no regrets’ approach to this work and aligning MEES with the approach followed by government funding programmes such as the SHDF, as well as government’s 2050 net zero target. It would also help to inform residents of all homes of the social and financial benefits that decarbonising their homes will have for them and prepare them for the changes that will be needed on the journey to net zero.

Collectively, the recommitment to the full Social Housing Decarbonisation Fund and a clear regulatory roadmap for minimum energy efficiency standards would provide the certainty the social housing sector needs to deliver the retrofit and decarbonisation required to meet the country’s net zero target. This is why we are calling on you to make these commitments in the upcoming Autumn Statement.

Yours sincerely,

Kate Henderson
Chief Executive
National Housing Federation