South East: The energy white paper's impact on housebuilding

Philip Brown, commercial property partner at national law firm Clarke Willmott LLP, comments on the impact of the Government’s energy white paper on the housebuilding sector.

The energy white paper builds on the Government’s plan for a green industrial revolution. One of the three major parts of the energy white paper focused on creating a fair deal for consumers, with objectives and measures to be achieved. The primary objectives outlined include protecting the fuel poor, providing opportunities to save money on bills, giving warmer, more comfortable homes and balancing investment against bill impacts. All eight measures announced will shape the direction of travel in terms of what type of homes will be built in the future either directly or indirectly.

One of the measures outlined in the energy white paper was establishing the Future Homes Standard ensuring that all new build homes are zero carbon ready. This is not a brand-new measure, but a development of a consultation launched by the Government in October 2019 on the conservation of fuel and power along with ventilation of the building regulations for new properties. The initial target of reducing carbon emissions by up to 80% to becoming zero carbon ready by 2025 is a step change.

Planners through the directive are expected to challenge developers in delivering the best energy standards incorporating the latest technologies such as air source heat pumps, latest generation solar panels and the banning of gas boilers and other carbon-heavy heating systems from new home builds. Additionally, extensions and modifications to existing buildings will also see the requirement of higher energy standards which also co-insides with another measure of the energy white paper being the extension of the Energy Company Obligation (ECO) to 2026. The announcement extended the warm home discount to £475 million per year from 2022 to 2025/26.

With so much focus from government in creating a green industrial revolution and achieving net-zero, in essence, they are reflecting how society values are changing in terms of climate change and sustainability. Talking to estate agents’, consumers are becoming increasingly conscious of environmental considerations when buying their home whether it is a studio apartment, or a luxury detached home in a gated community.

Historically housebuilders and estate agents have marketed properties based on their location and neighbourhood, kerb appeal, the size and floor plan, the wow factor in terms of finishing touches and storage. Today energy efficiency is playing a part in the decision-making process of buyers through the introduction of EPC certificates a few years ago along with a growing number of buyers expecting more sustainable and carbon-neutral homes, not only from an environmental but also an economic perspective.

What is clear is that the new home of 2030 will look and feel quite different. With advances in green energy technology such as the potential of hydrogen heating systems, the acceleration of deployment of electric heat pumps the housing sector is set for unprecedented change in the next 10 years.

It will be interesting to see how the other measures announced in the paper will evolve. I shall be keeping a close eye on potential regulatory changes including the consultation of energy performance in homes and regulation of third parties including energy brokers and comparison websites. As a firm Clarke Willmott through its knowledge and expertise in green energy, house building and real estate across a variety of disciplines amongst other areas is ideally placed to support housebuilding sector achieve its goals.

Clarke Willmott is a national law firm with offices in Birmingham, Bristol, Cardiff, London, Manchester, Southampton and Taunton.

For more information visit www.clarkewillmott.com