Last week's conference organised by the UK Collaborative Centre for Housing Evidence (CaCHE) brought together a range of housing professionals to consider the opportunities and challenges for retrofitting older residential properties in Scotland.
Retrofitting involves modifying existing buildings to improve the performance and energy efficiency of the building and its amenity for the occupants. Scotland has set a target to reach "net zero" emissions by 2045, and tackling emissions from inefficient homes is one of the key targets.
Niddrie Road, Glasgow
The conference centred around the lessons learnt from retrofitting 8 tenemental flats at Niddrie Road, Glasgow to an EnerPhit standard (a Passivhaus refurbishment standard from the Passivhaus Institute). That project was delivered in partnership by Southside Housing Association, Glasgow City Council, CCG and John Gilbert Architects as part of a council policy to deliver more social housing in areas dominated by the private rented sector.
Some of the key themes discussed at the event included:
Retrofit: funding.
There was agreement that there is a significant cost involved to retrofit properties: not only the cost of renewable technologies such as heat pumps, but also general repair costs to older stock and the costs for "fabric first" measures (air-tight insulation combining internal and external wall insulation, and mechanical ventilation and heat recovery).
With limited public funding available, innovative financing models are required so that retrofitting can be scaled up. Suggestions included:
- introducing a tax similar to that being developed in England i.e.a tax on energy linked to stamp duty where increased tax is payable when a property is sold but a purchaser would have 24 months to claw back some tax if they undertake decarbonisation measures;
- Introducing relief from VAT for retrofit works as a potential way to mitigate the financial barriers;
- creating a mechanism whereby an owner could grant a charge over the title to their property to fund retrofit and repair works to fund the upfront costs involved in undertaking retrofitting works.
Currently gas is a cheaper source of fuel than electricity; reform of the energy market to address this price imbalance is therefore required so that the switch to renewable energy sources such as heat pumps means that the costs of installation can be recovered more quickly.
Retrofit: practical considerations.
Retrofitting is relatively new to Scotland and the UK has been poor at data collection/monitoring which makes knowing what the best technical approach to take for an individual building difficult. Collaboration is going to be important so that lessons can be learned from other pilot schemes and research projects and consolidation of knowledge will be important so that it is easier for people to make informed decisions.
The scale and pace of retrofitting required is unprecedented and at the moment there is a lack of resource to deliver the level of works required. Developing an ecosystem of retrofit suppliers/installers in local areas would help with delivery and community wealth building.
The Niddrie Road property was in sole ownership of the housing association and there were no sitting tenants which made the work easier to deliver. In cities like Glasgow, however, there is a predominance of flatted multi-tenure properties so there are logistical, technical, and legal issues to be considered especially where retrofit works are to be applied to only some units.
Retrofit:social housing.
Generally speaking, social housing is more energy efficient than other tenures due to significant investment from registered social landlords (RSLs) to address issues such as fuel poverty. Many RSLs have accrued debt to fund these works and so will have to make decisions on what works they should be undertaking and to which types of property
A long-term view needs to be taken of the existing housing stock. If a property only has a remaining lifespan of 15-20 years, demolition may make more financial sense than retrofitting but runs contrary to current thinking.
The provision of affordable housing is paramount, and a balance needs to be struck between social housing providers doing their part to deliver net zero targets without detracting from their ability to continue to deliver much needed new homes.
Retrofitting for the future
The challenges presented by retrofitting are many but they cannot be insurmountable if Scotland is to progress towards a net zero nation which provides tenants with energy efficient homes heated in a carbon neutral and affordable way. As highlighted by the CACHE Conference, collaboration and information sharing will be key as well as thinking out of the box to raise the funding.
Brodies real estate department have expertise across the full spectrum of housing, construction, funding and planning sectors so if you have any queries in relation to the matters discussed in this article, please do not hesitate to get in contact with your usual Brodies contact who will be happy to assist.
Contributor
Solicitor
