Press Release

One Small Step for Energy Efficiency

11 September 2008

The government’s announcement today that £1 billion of funding is to be used to help households improve their energy efficiency has been welcomed by the Construction Products Association as the most important way for the country to meet its carbon emissions’ reduction targets.

However, as the investment to bring all the existing housing stock up to current regulations for energy efficiency is estimated to be nearly £200 billion, this £1 billion over three years, is only a very small step in that direction.

Speaking about the announcement, Michael Ankers, Chief Executive at the Construction Products Association said:  “We need to make it clear that this £1 billion is not new money coming from the government, but money provided by the energy companies under their Carbon Emissions Reduction Target (CERT).  It is therefore money that all of us have already paid to the energy companies for our energy, it is recycled money.  None the less, we are pleased the government understands that the real solution to this problem lies in reducing energy use over the long term, rather than providing short term subsidies for its consumption, especially as there is a great deal that can and should be done to improve the energy efficiency of existing housing.  We do recognise that the current sharp price increases create financial and social problems for some of the most vulnerable in society and that the government has to address this in the short term, but this mustn’t negate the urgent need for investment to deliver a proper long term solution”.

“The key to energy efficiency in many existing homes lies not in new high tech solutions, but in technologies that already exist and are proven, such as loft and cavity wall insulation.  In terms of carbon saved, improving the existing housing stock is 50 times more effective than insisting all new-build housing is zero carbon.  Good insulation is only one of a number of improvements that should be made to reduce carbon emissions.  It is therefore disappointing that other important measures such as replacement boilers and double glazing are not covered by these proposals and there is no help for the average householder who may want to make these carbon-saving investments at a time when household finances are under considerable pressure”.

“It is also perverse that we pay the full rate of VAT on some of the key energy saving products – boilers, double glazing – but a lower rate of VAT on the use of the energy itself. Government needs to review the VAT regime in order to increase the range of energy saving products that are subject to the lower rate”.

“Other suggestions we have made to government include using the measures recommended in the Energy Performance Certificate when people move house as an incentive to make improvements.  These could include a rebate on some element of the stamp duty paid provided they take the necessary measures within, perhaps one year of moving or a temporary reduction in the Council tax banding of the property once the measures are taken”.