Scrapping the Green Homes Grant will see less than 50,000 measures installed

By Jess Ralston, Analyst @jessralston2

Published:26 February 2021

The Green Homes Grant – the Government’s flagship energy efficiency scheme – has become an unlikely battleground ahead of the upcoming Budget. Plagued with delivery issues and short-termism, recent reports in The Times suggest that the whole scheme could be pulled.

Doing so, however, would represent a sizeable row back on ambitions to upgrade the nation’s leaky homes; on current trends, cancelling in March would see just 49,000 efficiency measures installed.

Running the scheme for another year but with dramatically reduced funding of £320m, an option that arose in Parliamentary questions, would lead to less than 125,000 upgrades. Both results are a far cry from the goal to upgrade 600,000 homes when the programme launched.

Let down

Analysis of Government data shows that, on current trends, just 26,000 tonnes per year of CO2 emissions would be avoided were the Green Homes Grant pulled in March – just 0.04% of total residential sector emissions, currently 66 MtCO2e per year.

It will also be bad news to the thousands of families either currently grappling with the application process, or who would be looking to use the scheme but have not yet taken the plunge. Despite Government protestations, the Green Homes Grant remains overwhelmingly popular, evidenced by both high application rates and pre-launch YouGov polling that showed more than half of homeowners were interested in the scheme.

Making it count

One silver lining from the data released to date is the popularity of the most impactful upgrades. By the end of January 2,548 and 3,766 applications had been made for cavity wall and loft insulation respectively, seen by experts as the best ‘bang for buck’ ways of cutting energy waste.

Encouragingly, the data also shows an appetite for treating the hardest homes to insulate – those with solid walls, typically built pre-WW1. Although just 176 homes had been boosted by the installation of solid wall insulation by the end of January, on current trends it is likely that 9,077 vouchers will be issued for external solid wall insulation and 1,954 for internal solid wall insulation by end-March.

To get buildings on track to net zero, the Climate Change Committee estimate that by 2025, around 250,000 homes with solid walls need to be insulated per year. In the four months to January, the Green Homes Grant saw applications for 16,000 solid wall properties – or a would-be c.50,000 if the scheme lasted the year – a vast 450% improvement on the 11,000 solid wall insulations in the whole of 2019, and a crucial step forward for warmer homes.

In the UK, around a third of homes have solid wall construction. Currently only 755,000 of these homes have insulation – only c.10% of those that may need it. With about half (45%) of the home's heat leaking through solid walls, wasting money spent on bills and increasing carbon emissions, the savings from insulation can be significant. For example, it’s thought that installing solid wall insulation can save up to £435 on energy bills per year and around one tonne of CO2 per home.

Expected breakdown of vouchers issued by end of March
Individual vouchers issued for each eligible measure at the end of the scheme, if current trends continue. Source: ECIU analysis of BEIS Green Homes Grant voucher release data.

Pressure to deliver

The current story of the Green Homes Grant is injurious politically, too. The pressure is mounting on the PM’s environmental credentials; the Cumbria coal mine, Leeds airport expansion and now pledges on homes plague the Government’s claims to be green.

Last year it was identified by fellow MPs that the flagship energy efficiency policy was well off-track, and another blow to the slow application process from the Environmental Audit Committee means it starting seems that the PM’s promises for a green recovery are not aligning with the realities of his policy slashing.

Abandoning the Green Homes Grant now will do little good. The disappointment of a poorly delivered, ineffective application process is without doubt a significant bump in the road. But scrapping it won’t help to restore trust, secure bill savings and importantly, reduce carbon emissions from homes – sticking with it just might.

*This analysis was also reported in The Guardian on February 26 2021

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