Government energy efficiency plans ‘dead in the water’ warn landlords

Plans to improve the energy efficiency of private rented housing have no hope of being met, following the Government’s failure to respond to a consultation, which closed two years ago. 

The Government proposed a target that all new tenancies in the private rented sector should be in a property with an energy performance rating of at least a ‘C’ by 2025. It proposed that this be extended to cover all tenancies in the sector by 2028.

Despite the consultation closing in January 2021, the Government has so far failed to provide any response to it, leading to uncertainty about what will be expected of the sector.

In view of the failure to provide any concrete steps forward the National Residential Landlords Association (NRLA) is calling on the Government to make clear that the dates envisaged in the consultation are now unrealistic. In addition, to provide certainty for the market, it is calling for a definitive timetable for publication of a response to the consultation and any required legislation thereafter. 

The Government also proposed that all landlords should be expected to pay up to £10,000 to make the necessary improvements to meet the proposed targets.

The NRLA is calling instead for the amount that landlords should be expected to contribute to be linked to average market rents in any given area. Under the NRLA’s proposals this would mean the amount a landlord would need to pay would taper from £5,000 to £10,000, taking into account different rental values (and by implication, property values) across the country.

Alongside this, the NRLA is calling for a package of fiscal measures to support investment. This should include the development of a new tax allowance for landlords who are undertaking works towards reaching Net Zero. 

Ben Beadle, Chief Executive of the National Residential Landlords Association, said: “We all want to see properties as energy efficient as possible. However, the Government’s delay in responding to its consultation on energy standards in the private rented sector means its plans are dead in the water. The lack of clarity is playing a major part in holding back investment in the homes to rent tenants desperately need. 

“In the interests of certainty, the Government needs to admit what we all know, namely that it has no hope of meeting its proposed energy targets for the rental market. 

“The plans as they currently stand, rely on a misguided assumption that landlords have unlimited sums of money. The proposals fail to accept the realities of different property and rental values across the country, and that the private rented sector contains some of the most difficult to retrofit homes.

“Ministers need a smarter approach with a proper financial package if we want to ensure improvements to the rental housing stock.”