IEMA responds to government consultation on the Future Homes Standard - March 2024

Following the closure of the government’s consultation on the Future Homes standard, IEMA's Policy and engagement lead Chloë Fiddy sets out the key points in IEMA’s response.

Building regulations cover a number of quality standards. Building Regulations Part L are the regulations that most interest those in the climate change sector, as they cover the efficient use of fuel and power, described as energy performance. The last major revision to minimum building energy performance standards in England was in 2013. In 2019 a commitment was made to revise them in 2025, to a standard which would result in 75% lower CO2 emissions than a home built to Part L 2013. A stepping stone update (Part L 2021) took effect in 2022.

In preparation for the current consultation, the Future Homes Hub convened a Task Group including a range of housing market participants and reviewed for DLUHC the opportunities and barriers of different approaches to achieving a standard that would deliver the emissions reduction ambition. Five ‘contender specifications’ were put forward, with hugely varied modelled outcomes. As an example, the future electricity bills for a typical end terrace house might be anything from £450/year less than Part L 2021 to £190/year more, depending on the specification.

In preparing its response, IEMA consulted with its own members and other organisations with interests in seeing a built environment that keeps carbon emissions as low as possible by design.

We were disappointed to see that the government consulted on the two least ambitious specifications (‘Option1 and Option 2’). Very broadly, Option 1 involves installing heat pumps instead of gas boilers and improving on building fabric for insulation. Option two involves switching gas boilers to heat pumps but is regressive on building fabric standards. The outcomes would be starkly different. The Impact Assessment accompanying the consultation calculates that Option 1 would generate energy savings worth £930 million, carbon mitigation benefits worth £2,210 million and air quality improvements worth £50 million, In contrast, Option 2 is modelled to generate energy cost increases of £1,040 million, carbon mitigation benefits worth £2,060 million and air quality improvements worth £40 million.

Clearly, with higher costs to consumers and lower carbon mitigation and air quality benefits, Option 2 was never going to be a realistic contender. Given this, our response not only states that Option 1 is vastly preferable to Option 2, but it also picks up on the opportunities missed by only consulting, effectively, on one specification. It is clear, from the work carried out by the Future Homes Hub, that there are existing technologies which are known to work at scale, that could have been put forward as Options. A recommendation follows that government should not only introduce Option 1, but also immediately plan for a more ambitious option to be introduced with little delay.

A glaring omission in the consultation was consideration of embodied carbon, the emissions locked in at the building stage. Our consultation response highlights that this was a missed opportunity: embodied carbon represents emissions happening now and have an immediate impact on our carbon budgets. A recommendation follows that embodied carbon should also be consulted on without delay, along with higher standards as previously noted.

Incidentally, the Competition and Markets Authority (CMA) very recently published a report on the housebuilding market in Great Britain. While a thorough analysis into energy efficiency wasn’t a core aspect of the investigation, it is mentioned. A sustainable home is defined ‘as one built, operated, and maintained in ways that reduce the carbon footprint and the impact on climate change. National Planning Policy in England, Scotland, and Wales all include directives on achieving sustainable development, alongside environmental and building regulation.’ This section of the report concludes ‘Efforts are being made by housebuilders to improve sustainability. The main spur to innovating in this regard appears to be the expectation of future regulatory requirements, rather than any pressure from investors or the public.’

The CMA report found that buyers of new build houses focus on price and location as key drivers of purchasing decisions, and in any case sustainability is assumed by buyers to be a feature of a new build. These findings reinforce the calls for Option 1 to be implemented and a further consultation to be launched in the very near future. It is clear that a solid regulatory framework is the only route to more sustainable new builds.

Read the full IEMA response here

As well as submitting a standalone consultation response, IEMA has co-signed a letter to the Secretary of State that tallies with the recommendations that we’ve made separately. Co-signatories to this letter cover the full range of organisations interested in better building standards, including developers, consultants, local authorities, housing associations, non-profits/NGOs, architects and designers, engineering consultants, contractors, building product manufacturers/suppliers, academia and finance.

Link to the letter and list of signatories here