Each week Kamma brings you a digest of the key stories on property decarbonisation and the path to Net Zero
1. A solution to the cost of energy crisis for UK households?
Scottish Power CEO has outlined a plan to protect households from rising energy bills that would cost over £100bn
Outline the proposal.
Energy prices are surging in the UK, but the debate over who is going to front the bill, at least in the short term, remains unresolved. Keith Anderson, Chief Executive of Scottish Power, has proposed a rescue plan with a price tag of £100bn over the next two years. It stipulates that energy suppliers should be allowed to cover the gap between the energy price cap and the wholesale price of gas by borrowing from a ‘deficit fund’ put together by the government and financed through commercial banks.
What are the implications of the plan should it be implemented?
In the short-term, the average annual energy bill would be closer to that of previous years, easing the burden on consumers. It would also help energy suppliers cover their hedging costs and avoid folding. However, the rescue plan will have to be paid off in the long term. This could be through general taxation, spreading the cost over energy bills for the next 10 to 15 years, or a hybrid of both approaches. This, it should be noted, is not a fixed proposal. For example, the government may choose to target only the 5mn households on universal credit payments, rather than all UK homes.
Kamma’s perspective: Protecting households from crippling energy bills this winter is an important short-term goal, but financing on the scale of £100bn should also look to progress measures that stop future crises of this nature from happening in the first place. This means allocating more funding for renewable energy development and retrofitting. Without significant and rapid progress on these fronts, the UK will continue to be vulnerable to climate risks.
Article: Shielding UK families from fuel bills crisis forecast to cost £100bn (Jim Pickard and David Sheppard, Financial Times)
2. A solution to the lack of skilled workers in retrofitting?
Businesses are innovating solutions to the lack of skilled workers available to retrofit nearly all of the UK’s 29mn homes
What’s the story?
To reach Net Zero, the UK must decarbonise its housing stock at a rate of 1.8 homes every minute. This is an immense logistical challenge requiring more skilled workers than are currently available. As the agenda slowly shifts towards prioritising retrofitting, businesses are mobilising to capitalise on the opportunity, but they must first train enough workers to meet the demand.
How are businesses innovating practice?
The company referenced in the article is B4Box, a construction training provider and employer established in 2008. They train tradespeople to become proficient in multiple trades rather than specialising in one, becoming known as ‘multis’. These workers can be relied upon to carry out most jobs from start to finish, including brickwork, painting, plastering, and woodwork, to name a few. This is different from the standard approach to retrofitting where several specialist tradespeople turn up to a project and work individually. The ‘multi method’, by contrast, requires fewer workers working in a team, resulting in greater cost- and time-efficiency. This means that the workforce can be stretched further to complete retrofits at a faster rate.
Kamma’s perspective: Government targets for energy efficiency are fast approaching, which will force the retrofit sector to grow. For example, all new private rentals must have an energy efficiency rating of C by the end of 2025, expanding to all rentals by the end of 2028. To make the transition efficient and cost-effective, the sector will need to be supplied with accurate information on the best solutions for different property types and the costs associated with each measure. This will help the industry stay within budget and better allocate resources.
Article: Master of all trades: retrofit firm tackles climate and cost of living crises (Alex King, The Guardian)
