The RLA (Residential Landlords Association) has given a very lukewarm reception to the coalition government’s Energy Bill “Green Deal”. The scheme has been heralded as a way of increasing energy efficiency in private rented sector properties as well as cutting electric and gas utility bills for tenants.
One of the biggest problems for any landlord looking to improve his properties energy efficiency is that 40% of properties were built before 1919 and most of them have a large attic space with no cavity walls. This makes energy efficiency difficult without having to spend in excess of £10,000 on each property in order to bring it up to the recommended standard. The big issue for landlords is, standard landlord insurance does not cover such work.
Richard Jones, the policy director of the Residential Landlords Association, said “When costs starts to exceed savings we have a big issue. There has to be some financial support to help balance those figures.”
The second reading of the Energy Bill will be heard in the House of Lords before Christmas and the RLA welcome the coalition government’s “pay to save” principle. The private rented sector will be the hardest to treat and there are not many opportunities to reduce costs by economies of scale. There are other concerns, regarding addressing energy efficiency which may get forgotten, these include improving the landlord’s energy savings allowance which gives them tax relief in exchange for any improvements made.
The energy bill does not address how the cost of any improvements is to be apportioned between electricity and gas utility bills. The RLA also think that more time needs to be given to fully assess if the Green Deal has been a success.
Richard Jones added, “Although the private rented sector represents only 14% of overall housing provision it is the only housing sector faced with the prospect of compulsion – and we believe mass voluntary compliance would be far more effective.
“There are other reservations, which we are raising with the government, but we are pleased that the bill does not want to see its powers cause a decrease in the number of properties available for rent at a time when there is a shortage of housing and a growing need for it.”