UK left out in the cold as Europe storms ahead on efficient homes

How have Germany and France managed success with housing energy efficiency schemes where the UK hasn’t?

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By Jess Ralston

@jessralston2

The premature closure of the Green Homes Grant in April meant that it helped fewer than 8% of its target of 600,000 homes. Other countries however have had more success. Looking at our closest neighbours, for example, reveals that other approaches have been able to deliver similar schemes. But how have Germany and France managed success where the UK hasn’t?

France

Like Britain, France launched Ma Prime Rénov (My Renovation Bonus) as a key part of the economic recovery measures from the coronavirus pandemic in 2020. Depending on household income, the scheme gave up to €75 / m2 of insulation and €4,000 for a heat pump – comparable to the £5,000 given to UK households (rising to £10k for lower-income families). However, crucially, in France it has been deemed a ‘resounding success’ dissimilar to the ‘flop’ that the Green Homes Grant was labelled in UK press.

France’s figures back up this claim of success: in the whole of last year 190,000 applications were submitted to the scheme and halfway through 2021 this had already doubled to 380,000. Continuing at that pace a full year may yield over three-quarters of a million applications – which is rather different to the 700,000 applications that are expected by Ministers in charge of the scheme.

This runaway popularity has been supported by funding, which was upped from €1.7bn to €2.4bn in 2021. Interestingly, this budget is comparable to the £2bn announced by the Green Homes Grant which was – ahem – not quite as successful.

The types of retrofits most in-demand in France were upgrades to the heating system (64%) and insulation (32%). These proportions of measures are roughly opposite to those most applied for in the UK, but the proportion of grants given to those in low-income households are roughly the same, showing that it is largely those most in need that take advantage of such schemes.

However, it is important to note that of the heating systems applied for in France, 8% were gas boilers. Although less than half the percentage of applications for heat pumps (18%), support for fossil fuel boilers in France adds to issues down the line and extends the life of volatile gas in the energy system. In the UK, the Green Homes Grant did not support gas boilers, a move widely hailed as a positive step towards the path to net zero – perhaps France could also learn lessons from us.

Crucially, examining the reasons why Ma Prime Rénov was far more successful than the UK reveals a not-so-shocking fact: making it quick and easy to access the scheme meant much more uptake. Indeed, the average response time to an application was just 11.5 days in France, whereas in the UK delays in issuing vouchers and payment when the work was completed were a major issue. In some cases, these delays even led to redundancies in firms taking part, not quite the ‘levelling up’ they were aiming to achieve. –

Germany

The successes of home retrofits schemes in France are echoed in Germany. However, the German Kreditanstalt für Wiederaufbau (KfW or Reconstruction Credit Institute) scheme is much more long-standing, having run for the last ten years and covering many different aspects of retrofit including energy efficiency and heating. This means it is less comparable to the Green Homes Grant but still teaches vital lessons on the importance of longevity of funding, compared to boom-and-bust cycles which unfortunately have been a theme of the last decade of energy efficiency policy in the UK.

In 2019, the KfW had 326,000 applications, up to 600,000 by September 2020, driven by increased uptake in renewable heat and energy efficiency in new and existing buildings. Similar to France, heating upgrades were popular, as in Germany switching from oil heating accounted for over a third – 280,000 – of the applications in 2020, around a four times increase on the year before.

KfW has been very successful in leveraging private sector finance. By mid-September 2021, €10.6bn had been invested by government in all building programmes, but already in 2020 this had been backed by €83bn private funding. Crucially building on the UK’s aim to secure employment post-pandemic, KfW is believed to have created 900,000 jobs.

Clearly, there are lessons that can be learned from looking at the UK’s experience with the Green Homes Grant compared to Germany and in particular, France, which had similar timescales and funding to the UK but delivered the target improvements due to successful administration of the scheme. Those hoping for a plan for energy efficiency in the UK’s stalled heat and buildings strategy were left wanting. Waiting much longer will only expose larger gaps between the UK’s progress on decarbonising homes compared to advances made in Europe.