5 challenges government has to overcome to support homeowners in the transition to net zero

This week saw the release of a damning new National Audit Office (NAO) report about the government’s Green Home Grant scheme. At Citizens Advice we shared some insights into the sorts of things people contacted us about when the scheme was open and the NAO report goes even further.

It says the government failed to learn from previous schemes to improve energy in homes and did not understand the challenges facing homeowners and the businesses who could carry out the work.

So what's next and why does it matter?

In April, the government set even more ambitious targets to reduce carbon emissions by 78% by 2035. 29 million homes across the UK will need to change to use low carbon heat technologies by 2050 — no small undertaking.

There are 16.6 million owner occupied homes in England and Wales (64% of all homes) and around a third of these homes have a mortgage. It’s unlikely the majority of people have vast sums of money in their bank accounts that they’re eager to spend on energy related improvements — and in fact 34% of people say their cash savings have decreased since the start of the pandemic.

The government has a plan of action for improving energy in homes in the private rental market, with minimum energy performance standards. And there is a commitment to review the Decent Homes Standard to consider how it can better support the decarbonisation and energy performance of social housing.

But there’s still no plan for the vast majority of homes — the 64% that are owner occupied.

We need a plan to help and support people to make the changes necessary to reach net zero and to have warm, safe homes. The government must learn from previous energy efficiency and low carbon heat schemes in order to achieve real, lasting and impactful changes to energy in people's homes.

To support homeowners the government must tackle five key challenges:

1. Simplify the process. In previous schemes it’s been far too complicated. Energy efficiency and low carbon heat tech can be so confusing. Poorly designed schemes can add to this, meaning people just give up. New schemes should include independent information, advice and support to help people navigate this complexity
2. Crack down on rogue traders. Advice about scams was the single biggest issue people contacted us about with the Green Homes Grant — people are worried about being scammed and not without reason. New schemes must not mean new opportunities for climate cowboys to take advantage of people.
3. Avoiding a 'boom and bust' approach to schemes is going to be essential. The NAO report was forensic in its understanding of the competing pressures the Department for Business Energy and Industrial Strategy was under while it was delivering the scheme (including responsibility for delivering work on EU Exit, setting up the Covid vaccine taskforce and supporting industry during the pandemic). The tight timescales for the scheme and post pandemic economic circumstances made the Green Home Grant difficult to both design and deliver. However other schemes have suffered from these issues too, either having to ramp-up very quickly or end abruptly. Ultimately this kind of of stop-start is bad for both consumers and businesses. It increases confusion and can lead to offers being advertised that are unintentionally out of date or inflated prices due to short timescales for delivery. People are already put off by what they view as inconsistent government policy in this area and a lack of long-term certainty also makes it harder for reputable firms to get involved in the market, invest in skills and create new jobs. Experience has proven that inconsistent policy can lead to higher delivery costs and lower quality work — new schemes should avoid this.
4. Plan and publicise how it's going. There should be regular, effective monitoring and enforcement of standards of work. We don’t yet know how people have experienced installations using the Green Home Grant but previous schemes have suffered because of a lack of transparency when it comes to taking action on poor quality work. Our experience in the regulated energy market is that publicising how companies are performing can encourage businesses to improve customer service and result in better consumer experiences.
5. Influence behaviour. It’s essential to create incentives that encourage people to think about making energy improvements to their homes. We know consumer inertia (as well as a lack of trust) when it comes to making these changes, can have an impact on whether people take action. But there are trigger points when people tend to be more predisposed to making changes to their homes and the government should establish policies that encourage or expect this. For example, related to a house move with or when they carry out renovations.

But most importantly, government must put people first in the upcoming Net Zero Strategy

This summer we worked with groups representing both consumers and industry to write to the Prime Minister, urging him to address the gaps when it comes to information, protection and support for people making energy related changes to their homes.

As it drafts the Net Zero Strategy and prepares for COP26, the government has an opportunity to address these issues and avoid past mistakes. Citizens Advice understands that the strategy will include plans for public engagement about Net Zero. It’s vital that the government also uses this as an opportunity to make it clear it’ll take a robust and systematic approach to consumer protections.

New schemes to help people make changes to homes have to focus on giving people the tools, support and confidence they need to engage with the process and support the transition to net zero. Putting any future retrofit schemes on a long-term footing will allow industry greater time to upskill, better support its implementation and improve the experience for people making changes to energy intheir homes.