Briefing

Energy Performance Certificates and the road to a green economic recovery

As the world economy begins to get back on its feet following the seismic shift caused by Covid-19, a much larger climate threat looms, highlighting the need for a sustainable economic recovery. And, with almost 40 percent of the UK’s carbon emissions stemming from the way our buildings are heated and used, Energy Performance Certificates (EPCs) could prove to be a valuable insight in evaluating housing stock efficiency and a critical component for assessing our alignment with net-zero.

Introduced by the EU in 2007, EPCs provide information on a property’s energy usage, using a ranking system of A – (the most energy efficient) to G – (the least energy efficient) as well as suggesting methods to improve energy efficiency. To paint a picture of the task at hand, 71 percent of UK homes do not meet EPC standard C, the minimum requirement to bring buildings in line with net zero.

Open data and accuracy

While EPC data could prove to be a useful instrument in framing policy ideas centred around a green economic recovery, we should first assess the potential flaws in this data. According to a report by Spec, around 2.5 million EPCs could be wrong because of errors in measurement standards and practices. What’s more, the Property Technology solution states that 90 percent of EPCs lodged use simple averages or standardised values rather than actual measurements.

Another seemingly glaring error is the depth of inspection. If an assessor is unable to see the use of energy efficient measures, such as loft insulation, then the software used assumes an insulation level in line with when the property was built. Meaning, that for a house built over 100 years ago, zero insulation will be assumed, providing an inaccurate portrayal of housing efficiency.

EPC data is publicly available in England and Wales under a UK Open Government license v3.0 with the exception of address data which is provided under a Royal Mail Copyright Notice. Open data access to real-time EPC datasets can improve functionality and enable interoperability between other government owned databases as well as providing value to academia and businesses. The UK government’s ‘Action Plan’ released in September 2020, lays out plans for the creation of a new EPC register by the end of 2020, addressing issues of accuracy and openness while also moving towards EPC ratings that are more reflective of actual household energy use, an important move given the increased number of people working remotely.

A tool for framing policy

Across Europe, EPC data is being utilised for policy making and monitoring. Bulgaria, for example, set its national recovery strategy using EPC data. And, in a pilot scheme run by the Energy Efficient Mortgages Initiative, lenders will be offering lower interest rates on mortgages for both new build homes and renovations based on EPCs. KfW’s Environmental and Energy Efficiency Programme provides subsidies to building owners, including long-term loans with low interest rates and grants. The German development bank uses EPCs to determine the efficiency level of a household, rewarding higher efficiency levels with higher funding.

EPC data can be a critical metric in forming policy and shaping green initiatives. And, with domestic homes alone accounting for around 15 percent of UK’s greenhouse gas emissions, the data provides both public and private owners and tenants with vital information, legal certainty and incentives to improve their household energy efficiency. But, in order for the government to meet its commitment to net-zero by 2050, EPC data needs to be more accurate, reliable and open. 

Find out more

On Monday 16 November 2020, our team will be hosting a session to discuss how policy interventions can help local governments, cities and regions accelerate innovation and drive toward a net-zero economic recovery from Covid-19 at London Climate Action Week 2020. Their remarks will draw on the preliminary findings of our net-zero Covid-19 recovery programme, Project Cygnus. To find out more about the findings which will touch on some of the content elaborated above, sign up for free here.