Whilst others are busy comparing competing views on the coalition’s environmental record after Chris Huhne’s speech on the Green Deal at the LSE yesterday, all the papers (The Times (£), The Daily Telegraph, The Guardian) seemed to miss a significant aspect of the story behind the climate change and energy secretary’s speech.

Whilst the average energy efficiency of the private rented sector is now similar on average to that of home owner occupiers this hides the high proportion of appallingly inefficient properties in the private rented sector – 20.5 per cent are F rated or G rated properties – more than 676,000 homes.

On top of this highly inefficient stock, 47 per cent of homes in the private rented sector are non-decent with a Category 1 hazard under the Housing Health and Safety Rating System (HHSRS). These worst properties are, effectively, unfit for human habitation.

In July, Grant Shapps announced his promise to the private landlords – there will be no more red tape, no more regulatory ‘burden’, no more restraining the sector’s ability to make higher margins. Mr Shapps sought to perpetuate the myth that:

“… the vast majority of England’s three million private tenants happy with the service they receive… the current system strikes the right balance between the rights and responsibilities of tenants and landlords.”

Given the evidence of the appalling quality of the private rented sector, the widespread dissatisfaction of tenants and likelihood that the poorest will be consigned to live in the worst properties it is a ludicrous suggestion that the private rented sector operates within a functional legal framework – especially with regards to energy efficiency.

The announcement by Mr Shapps tied the hands of the Department for Energy and Climate Change (DECC) and Mr Huhne with the Green Deal. There is a real need to regulate the private rented sector to ensure the worst properties are improved which they now can’t achieve unless the Department for Communications and Local Government (DCLG) accepts the reality of the situation in the private rented sector.

The Government will now, through the Energy Security and Green Economy Bill, seek to place the burden on the tenant to improve the landlord’s property and then have to pay for it through their energy bills.

There have been many excuses over the years as to why landlords won’t improve their properties, but the chairman of the National Landlord Association was the most honest about the problem in his evidence to the Communities and Local Government Committee in 2007:

“I can only surmise from my position working with landlords day to day that the situation must have something to do with the fact that landlords generally do not live in the property.”

The sector is not only the worst maintained, but we seem to accept that businesses (for that is what landlords are) are allowed to subject their tenants to living in appalling conditions with inadequate levels of insulation and poor heating. The coalition government’s approach to addressing this is to shift the responsibility from the landlord onto the tenant to ensure the property is improved.

The government could have chosen to compel landlords to improve the worst properties through a functional regulatory framework with the tenants protected. Instead, they deferred the decision to 2015. Introducing a clear, timetabled regulatory framework of mandatory minimum standards of energy efficiency for the private rented sector at the start of the Green Deal with the landlord, as the owner, being responsible for maintaining and improving the property would be far more appropriate.

Instead, the government has sought to empower tenants to improve the landlord’s property instead with the landlord unable to refuse. The tenant will also have to pay for the improvements through their energy bills through taking up the Green Deal finance.

The real winners yesterday were the landlords. They will gain from a higher quality property that can command a higher rent and a higher resale value. Every tenant should be able to live in a home that is as warm as everyone else but they shouldn’t have the burden placed on them to carry out and pay for these improvements when they don’t own the property.

Last week The Times reported a further development in the coalition Government thinking on the Green Deal – the flagship Department for Energy and Climate Change (DECC) programme currently under development that will seek to improve the energy efficiency of existing homes. The article propagated follow up coverage on the websites of the Telegraph and the Daily Mail (twice).

The second piece in the Daily Mail is of particular interest. From the quote by the TaxPayers’ Alliance, full of cliché and misrepresentation, it is clearly evident there are no justifications based on fact and evidence supporting the case against nudging home owners to improve their property.

The Government is investigating how they could alter stamp duty to drive home owners to take up energy efficiency measures when they buy a property. The proposal under consideration is to target those properties that are the worst with this measure. Properties such as those that fall into a band F or G on an Energy Performance Certificate (EPC) are incredibly inefficient – they are the worst of the worst in terms of energy efficiency and they make up 20 per cent of the British housing stock – just under five-and-a-half million homes.

The suggested reforms to stamp duty are a tax – in part. There is not disagreement that this is a stick. It is also a significant carrot. Refunding of 1 per cent of the stamp duty levy for undertaking some relatively painless improvements to the property so it reaches a band E on an Energy Performance Certificate isn’t a particularly onerous burden on new homes owners who are likely to want to undertake some work on the property before they move in.

The Energy Saving Trust recently released their analysis into F and G rated properties. They have shown that a large majority of these F and G homes will cost under £3,000 to upgrade to a Band E. Under the Green Deal, there would be no upfront cost to the homeowner. They would benefit from the incentives, reduced running costs for their home and will have contributed towards reducing carbon emissions.

It has been obvious for many years that current incentives for improving the energy efficiency of existing homes have been ineffective in delivering especially in the absence of a coherent programme of delivery.

To achieve the legal targets for carbon reduction delivery of a substantial improvement of energy efficiency in the existing housing stock is required (chapter 3 of the committee on climate change 2nd progress report presents a fairly robust indication of the scale required to be achieved in the existing housing stock).

There are three choices ahead for the Government on driving uptake of energy efficiency in existing home to achieve the carbon budgets:

• They can incentivise property owners through a suite of financial measures designed to stimulate the market at various trigger points for retrofit from 2012 onwards;

• They can mandate a minimum standard of energy efficiency for all tenures from 2012 and ban the sale of a property that fails to meet this standard; or

• They can do nothing and see the Green Deal fail in the face of poor take-up.

The success of the DECC flagship programme is dependent on the introduction of incentives such as reforms to stamp duty and rebates on council tax. Climate change and energy secretary Chris Huhne and Gregory Barker, Minister of State at DECC, should be applauded for choosing to incentivise homeowners with a combination of carrots and sticks.

It would be all too easy for the Government to choose to do nothing in the face of a vocal minority; something which will only lead to the Green Deal failing.

Nick Clegg spoke exclusively to Left Foot Forward today en route to the Liberal Democrats’ new manifesto pledge on green jobs in Newcastle.

The Liberal Democrats plan to create 57,000 jobs by investing £400 million upgrading disused shipyards to enable the production of off-shore wind turbines. The party claims that the proposals would enable firms to manufacture off-shore wind turbines in the UK, instead of seeing them built abroad due to out-of-date facilities.

On the 07.00 from King’s Cross, Clegg told Left Foot Forward:

“The key thing is for this to benefit British workers and British families. …We have Vestas in the Isle of Wight closing down, and ninety per cent of the production for the London Array – the world’s biggest wind turbine project – has gone abroad. Siemens has invested in a renewable energy centre in Sheffield but they are not sure if they want to set up production here. We need to remove the blockages – lack of space, access to facilities and transport to off-shore sites.

“Refurbishing seven of the ports will be a shot in the arm to increasing industry and manufacturing that will benefits regions like the North East.”

The Liberal Democrats are concerned that, under current plans to expand wind farms in the North and Irish seas, every one of the 6,400 turbines needed could be brought in from abroad, as there are currently no turbine manufacturers in the UK. They believe that British ports are ideally located to host turbine manufacturers due to their proximity to the off-shore wind farms. One quarter of the proposed budget would be spent on training and testing facilities, including at universities with specialist engineering research facilities such as Loughborough, Durham and Newcastle.

Shipyards around Europe are already benefiting from the expansion of offshore wind power. Harland & Wolff, a Belfast-based shipyard company, secured a new contract last September to build 30 wind turbines. The shipyard also constructed the Sea Gen turbine, the world’s first commercial scale tidal stream power project. It has in the past won contracts to construct turbines manufactured by Vestas.

Business Green are reporting that

“[the] new funding would form part of a proposed £3.6bn green stimulus package paid for with a range of reforms, including cuts in tax credits for higher earners, a reduction in the Highways Agency Major Improvements Budget and the introduction of a 10 per cent banking levy.”

There is concern among renewable energy experts that the Government’s industrial strategy does not address critical supply chain issues such as infrastructure, training, skills, and the need for assessment centres. The Liberal Demorats’ plans would go some way towards addressing these shortfalls.

The implications of David Cameron’s comments on green homes in Wednesday’s Guardian are becoming clearer. Previous announcements have alluded to what the Conservative plans would involve and the slow drip of information continued on Wednesday; if the Conservative Party wins the next election they will scrap grant payments for improved heating and insulation – the only means by which disadvantaged households can access assistance to achieve a warm and healthy living environment.

The announcement was the first public confirmation that Conservative plans for tackling carbon emissions are designed purely to attract wavering but affluent Liberal Democrat and Labour voters.

Meanwhile, the scrapping of assistance designed to reduce energy bills and improve the quality of life of poor and vulnerable households provides a glimpse of what compassionate conservatism may actually mean.

Whilst there are many faults with the approach to grant schemes such as Warm Front under the current government there is at least an understanding of the need for grants to support those in no position to help themselves.

Many of the problems with Warm Front have been addressed and resolved including increasing the maximum grant, improved contract management, boosting competition, and improving standards of work, but there is still a long way to go. However previous issues around the delivery of Warm Front should not be used as a justification for the ending of grants.

Nor will anyone be persuaded by the glib and complacent assurance that all those in need of assistance have already benefited. This is self-evidently untrue as 6 million fuel-poor households can testify. National Energy Action (NEA) analysis of the English House Conditions Survey shows that of all the vulnerable fuel poor households, 34% still have an unfilled cavity – that’s 765,000 households.

Of all the fuel poor, 80.9% of unfilled cavities are in the private sector, which is 790,000 households. Warm Front grants target vulnerable households in the private sector. (Shadow Energy Minister Greg Barker please take note).

Whilst 2 million vulnerable households have been helped under Warm Front since June 2000, they have not all been removed from fuel poverty and this is a major failing of the current grants system. A coherent programme would involve implementation of all feasible and cost-effective measures to ensure that energy costs of those vulnerable households were reduced to a point where they would be removed from fuel poverty.

Failure to adopt a comprehensive programme meant a missed opportunity to comply with fuel poverty targets set out in the Warm Homes and Energy Conservation Act. The Conservative answer to this failing seems to be the incomprehensible and unacceptable decision to scrap grants altogether rather than attempt to resolve the failings and wasteful delivery model of existing schemes.

The BBC article covering the announcement is in itself a cause for concern on several levels. It is either an example of poor journalism or the Conservatives are presenting a misleading description of the implications of the announcement.

The apparent depiction by Cameron of the £6,500 loan as a grant is either a serious misunderstanding or disingenuous politics. At best it could be a mistake by the BBC who have failed to understand that the proposals are offering debt to households.

At worst it is CCHQ attempting to describe their proposals as something they are not. This is a debt and is not a grant.

The details of the Conservative proposals must be subject to serious scrutiny. For example, if the householder is paying off £120 per year on a £1,500 loan it will take at least 12½ years to pay back. When you take into account the interest on the loan that the likes of M&S and Tesco will earn, say 7%, you are looking at more like 20 years to repay. Does this really represent an attractive offering?

A quick glance at the projected savings under the Tory plans (they have yet to publish any key details or analysis) shows they predict savings of £360 per year on the average energy bill from standard insulation measures. Analysis by National Home Energy Rating (NHER) shows savings for standard measures might average around £182 per year.

NEA’s initial interpretation on the limited information currently available on the Conservative plans suggests that up to £250 may be possible. This undermines the Conservative line that there will be substantial reductions in fuel bills and that only a small proportion of that saving would be taken up by the repayment of the loan (Conservative data suggest 33%; the NEA figures suggest 48%; and NHER figures 66%).

There was an assumption that political consensus had been achieved on fuel poverty, that energy efficiency was the most rational and sustainable solution and that those who could not afford to invest in heating and insulation improvements would be supported by Government. Seemingly this is not the case.

David Cameron’s sound bite on the BBC site was:

“If we make the answer to climate change sound like sitting in a dark room with a big woolly pullover on, with the heating turned down, with our teeth chattering and being miserable, then we’re never going to sell it to anybody.”

Unfortunately, Cameron’s imaginative picture may prove to be the reality for millions of disadvantaged and other vulnerable households.

Grant Shapps’s keynote speech on creating a green housing policy at the Building Research Establishment today recognises the route we have to take but lacks the ambition required to actually get there.

The proposals outlined in the speech demonstrate a mismatch between the policy objectives and the means necessary to achieve them and add little to Greg Clark’s speech and Oliver Letwin’s comments at the Conservative party conference last month.

Tory policy on homes and community retrofit requires further detail and clarification.

To say that greening of existing homes has largely been ignored is simply inaccurate. Mr Shapps overlooks the Carbon Emissions Reduction Target, the Government consultation on the Heat and Energy Saving Strategy (HES), and the UK Low Carbon Transition Plan.

These policies and documents are inadequate both in scope and ambition, but they do demonstrate a focus on existing buildings on the part of the current government.

Since the end of the HES consultation, civil servants at the Department for Energy and Climate Change (DECC) have devoted considerable time and energy to this issue and are in the process of preparing what could turn out to be an ambitious, deliverable plan for the retrofit of existing homes.

But how well will the Conservatives’ Green Deal address what actually must be done to existing homes and communities in order to meet carbon reduction targets, achieve energy security and renewables goals and assist in eradicating fuel poverty?

In the first place, we need greater direction and motivation if home owners and tenants are actually to have their homes improved. We also need to be realistic about the scale of the problems and the extent to which a loan of £6,500 can resolve them.

The Pay-As-You-Save (PAYS) mechanism does partially tackle one of the main barriers – access to finance – but that on its own will not be enough to motivate households to participate. Simplicity and ease of access through a trusted and objective source is a necessary precondition.

Expert, independent advice is needed in relation to energy efficiency improvement measures needed in the home and in the wider community; can property owners really be expected to implement expensive heating and insulation improvements in their home as a result of an approach at the checkout in M&S or Tesco? We need a proactive and locally delivered programme, where those advising householders utilise local knowledge and understanding of the needs of the home and its occupants.

New boilers, cavity wall insulation and compact fluorescent lightbulbs (of which almost 170 million have been distributed under CERT in the last 15 months) cannot deliver the necessary 80 per cent emissions reductions referred to in the speech. They represent easy wins which should have been dealt with by 2015 at the latest.

A quick glance at the Committee on Climate Change’s first annual report is enough to realise how much more must be done.

The harder, more costly measures such as solid wall insulation and local heat and electricity generation need to be included in any neighbourhood and home retrofit programme. This would require a higher cost to households that could be repaid under the PAYS scheme proposed.

The UK Green Buildings Council suggests up to £10,000 is possible under PAYS. In reality some (not all) households would need to spend between £15,000 and £30,000. Our housing stock is not all detached, post-1945 homes in the suburbs.

There are more difficult properties – the Victorian terraces and flats (among others) – that contribute disproportionately towards carbon emissions due to low energy efficiency standards. Inadequate funding levels could well leave the householder with high energy bills and not enough assistance to fully retrofit their property.

The speech makes no reference to the impact on fuel poverty of inefficient housing. The Conservative plan, as articulated today, appears to make no provision for the most vulnerable and disadvantaged households. The PAYS mechanism is not appropriate for fuel-poor households – this is conceded by the UKGBC which has done most work on the proposed model.

These households require government assistance but we heard no firm commitment today to helping those in the worst properties, who are vulnerable or on very low incomes.

There are ten key principles to retrofit which should underlie any programme:

The warm homes campaigners National Energy Action (NEA), however, have worked to develop an appropriate model for the delivery mechanism and have also looked at other finance and incentive options required to achieve both social and environmental objectives through a home energy retrofit programme.