A new paper published by Bankers for Net Zero and the Green Finance Institute outlines the barriers to retrofit investment and sets out a clear plan for scaling up the retrofit industry in order to decarbonise an estimated 29 million homes.
The paper – Tooling up the Green Homes Industry: Financing the Retrofit Supply Chain – also provides six high-potential solutions for the investment and finance industry, and relevant business groups, to act on:
- Increase access to sustainability-linked loans for SMEs
- Create dedicated “Green” or “Transition” SME funds
- Add green criteria to existing public finance schemes and use guarantees to “crowd in” private capital
- Create advisory hubs that bring together customers, suppliers and finance providers
- Create the rules and protocols to enable more accurate, real-time assessments of property performance
- Strengthen the ecosystem of SME accelerators and growth hubs
The paper also shares key principles for new government policy in this area:
- Front-load market support – using the funds already committed to the decarbonisation of social housing and public buildings to pump prime the market
- Set out a clear regulatory pathway for energy performance standards for all building types
- Set out an overarching strategy for applying an adequate and consistent carbon price to every tonne of CO2 emitted in the UK
The paper also calls for the UK government to raise the minimum threshold for Energy Performance Certificate (EPC) ratings required to lease or sell a property. Raising this requirement will drive private sector investment from landlords and homeowners across the board, complementing public sector investment to accelerate adoption.
The paper is available here volans.com/project/bankers-for-netzero/
Louise Kjellerup Roper, CEO of Volans and Bankers for Net Zero founding partner, said: “Retrofitting the UK’s outdated 29 million homes is an essential part of our fight against climate change. One which will address a massive 23% of the UK’s emissions while creating thousands of new jobs and driving down heating bills across the country. The retrofit industry – mostly made up of small and medium sized businesses – will struggle to take on this challenge without investment and support. Which is why we have offered six actionable solutions for finance and business to apply right now – tooling up the retrofit revolution for a prosperous, net zero emissions UK.”
Emma Harvey, Programme Director at the Green Finance Institute, said: “Addressing the £360 billion investment gap to decarbonise the UK’s building stock requires innovative thinking on the funding models, business practices and policies that will drive retrofitting at scale. Today’s report outlines the practical solutions and initiatives that can catalyse rapid growth along the retrofit supply chain, support green collar jobs across the country, and reinforce the UK’s global position in the green finance landscape.”
