£15bn plan to retrofit existing homes in Wales could eradicate fuel poverty says Future Generations Commissioner
Fuel poverty could be eradicated in Wales by 2030 if Welsh Government commited to a long-term plan to retrofit existing homes, a report by the Future Generations Commissioner has argued.
A £15bn investment plan for housing would, according to Sophie Howe, be a “game-changer” for the Welsh economy and help Wales and the UK meet their carbon emission targets.
The long-term plan to ‘retrofit’ homes to reduce heating/energy demand would create 26,500 jobs by 2030, saving bill-payers hundreds of pounds each year, while also improving and modernising Wales’ housing stock, she said.
Wales has some of the oldest and least efficient housing in Western Europe and around 155,000 (12%) of Welsh homes are in fuel poverty due to the economic impact of Covid-19.
More than 66,000 households in Wales have fallen behind on their energy bills since the start of the pandemic, says Citizens Advice, and disabled people are four times more likely to be in energy debt.
Vulnerable people living in a cold home have an increased chance of serious illness or death, according to the National Institute for Health and Care Excellence, and are at higher risk of heart attack, stroke, breathing problems, flu, depression and falls.
Sophie Howe said: “The climate emergency and fuel poverty are two parts of the same problem and if we are truly determined to solve it, we need ambitious and interconnected policy actions.
“Right now we have the chance to do something life-changing for the families, pensioners and people who simply cannot afford to heat their homes properly, and to eradicate fuel poverty for generations to come.
“The Well-being of Future Generations Act says that by law, the way we get to net zero has to improve Wales’ well-being as a whole.
“A long-term plan to decarbonise Wales’ housing stock isn’t merely an aspiration, it’s an absolute necessity – and it’s the only way to pull thousands of people out of fuel poverty as part of a true green, just and equal recovery – and show just how far we can go as a country as the world combats climate change.”
The commissioner’s new report, Homes fit for the Future: The Retrofit Challenge
- Eradicating fuel poverty and saving £8.3bn in energy bills by 2040.
- Reducing the strain on health and social care services, particularly during the winter – generating a cost saving to the NHS of £4.4 bn by 2040.
- Creating new industries, skills and jobs, based on local supply chains – 26,500 new jobs by 2030, helping to offset the economic impact and job losses of the pandemic. Jobs could include in areas such as installation of solar panels and ground source heat pumps, retrofit assessing and coordinating. Many are roles where existing trades can upskill/ retrain into, via ‘feeder trades’ such as electrician, plumber, plasterer.
- Creating £19.32bn in additional GDP and £3.54bn of net tax benefit by 2030.
Welsh Government has set itself a legal duty to reduce harmful greenhouse gas emissions to reach net zero by 2050 – and 10% of Wales’ emissions come from the residential sector, one of the slowest areas across the UK to decarbonise.
Wales’ Well-being of Future Generations Act requires Welsh Government to use joined-up thinking to develop long-term solutions and prevent problems, and a ‘Retrofit Plus’ approach, the commissioner said, should be used to improve communities in line with the Act, while housing investment should be treated as essential infrastructure – as important as public transport and power.
The report says that it is the poorest and most marginalised populations are least responsible for climate change but the most likely to be exposed to its negative effects, more susceptible to damage and have the least resources to respond, cope and recover, so Wales should target the worst homes first.
Welsh Government also needs to urgently address the skills gaps in retrofit jobs, both in numbers and diversity, or risk having an ill-prepared workforce, the report argues.
The report also suggests a new Welsh Energy Service Company is set up to coordinate and fund improvements, with new legal requirements for homeowners to bring their homes up to standard, alongside loans to support the improvements.
Lead author of the report, Donal Brown, sustainability director at Sustainable Design Collective, said that the report makes the case for a ‘Marshall plan’ scale investment for Wales to get on track for housing decarbonisation.
“While we see a central role for government in reducing fuel poverty and helping those on low incomes, we also propose a major role for private investors in the form of green bonds and green mortgages,” he said.
“Importantly, finance alone will not solve this challenge with regulation, skills and coordination essential to deliver the vast benefits of this program over the next decade.”
Chaitanya Kumar, head of environment and green transition at the New Economic Foundation, added: “The housing stock in Wales is some of the leakiest in the UK and needs urgent upgrading. This comes at a cost but it also brings immense benefits by creating thousands of jobs, slashing energy bills and improving public health.
“Our report lays out a clear roadmap for the next decade that brings public and private finance together to help bankroll Wales’s ambitious decarbonisation targets but Welsh government needs to lead the way with urgent public investment at scale.”