8 March 2023
Energy Performance Certificates must be reformed if we are to deliver Net Zero

Peter Aldous and Miles Briggs, MSP for the Lothian region, write for ConservativeHome

Almost a fifth of the UK’s carbon emissions come from heating our homes. In order to reach our Net Zero targets, decarbonising the UK’s housing stock will be key.

We can and should look to heat our homes with low-carbon solution like heat pumps, hydrogen, or renewable liquid gases. But we must also look to improve the energy efficiency of our homes to reduce the amount of energy needed to heat them in the first place.

As a way to drive this change, both the UK and Scottish Governments plan to use Energy Performance Certificates (EPCs) as a tool to improve the energy efficiency of the UK’s housing stock.

From 2025, all rental properties in Scotland will require an EPC rating of a ‘D’ and from 2028 all rental properties in England and Wales will require a rating of ‘C’.

EPCs were first introduced in England and Wales in 2007, and a year later in Scotland as a tool for measuring a building’s energy efficiency. However, due to the methodology that sits behind them, they are fundamentally flawed.

The key issue with EPC methodology is it is disproportionately focused on the cost of the input fuel. In essence, this means EPCs are nothing more than a measure of energy cost per square metre, rather than a measure of energy efficiency.

You could be forgiven for assuming that, as everyone is affected by the poor methodology, the playing field is levelled. But this is not the case.  The flawed methodology has a particularly adverse impact on our rural communities, from the Suffolk Coast to the Pentland Hills.

This is because the fuels available to communities not connected to the gas grid typically cost more than the ones used by their on-grid, urban counterparts. As a result of this, there could be two identical properties, one off-grid and one on-grid, with vastly different EPC scores, just because of the cost of fuel they use.

More worryingly, the flawed EPC methodology has the potential to drive off-grid homes away from low-carbon technologies and onto higher carbon, cheaper energy sources to gain a higher EPC rating, rather than improving the building’s fabric.

Many rural property owners considering updating their heating systems have been advised their property would be unrentable and in the future unsellable and they should instead stick with their existing oil heating. This cannot be right and does nothing to help our rural communities to decarbonise.

This ‘fabric last’ approach not only fails to deliver building standard improvements for residents, but it also directly counters Government’s wider decarbonisation objectives.

The current methodology means that if off-grid homeowners do, rightly, push ahead with a ‘fabric first’ approach it could cost them upwards of £20,000 to achieve EPC Band C – £15,300 more than the average £4,700 quoted.

The flawed and unfair approach to EPCs will undoubtedly devalue off-grid properties as potential homeowners and landlords choose not to invest in rural locations due to the unfair policy penalties.

To address this, EPCs require urgent reform. Splitting the methodology into actual energy efficiency, carbon, and average energy costs would make it clearer and fairer for rural homeowners whilst focussing on actual energy efficiency.

There is no question that the UK must improve the energy efficiency of its housing stock if we’re to reach Net Zero, but before EPCs are used as policy tool to do this, they must be reformed and made fit for purpose.