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Cold Homes Loophole Could Lead to £1bn energy bill for Vulnerable Tenants

Cold homes loophole could see vulnerable tenants hit with £1bn energy bill.

Housing standards exemptions that opened on Friday could allow landlords to leave some of the most vulnerable private renters with a £1bn energy bill over the next five years.

Regulations were initially passed under the coalition government, but the subsequent closure of energy efficiency funding schemes means landlords may be able to exempt themselves from having to improve the worst privately rented housing stock – potentially affecting up to 700,000 tenants.

300,000 Rental Properties

From April 2018, regulations will come into force that prohibit the renting of properties with energy performance certificates below band E in England and Wales. Latest figures show this covers close to 300,000 rental properties, with the Government’s own figures estimating the annual energy bill savings for a household moving from band G to E would be £990/yr. For a band F household it would be £510/yr.

However a new loophole in the regulations risks allowing landlords to register for a 5 year exemption from the requirements if there are not adequate energy efficiency policies to fund the measures. With the closure of schemes such as the Green Deal,  Landlord Energy Saving Allowance (LESA) and reductions in the only remaining scheme, the Energy Company Obligation (ECO),campaigners fear landlords will use the lack of funding as a reason not to invest in these properties. This could add up to £1bn to the energy bills of tenants already living in the worst housing stock over the 5 years the exemptions last. In contrast, research has shown that over 70% of properties could meet the standards at a cost of no more than £1,000

Improvements Must Be Made

10:10 Climate Action is leading a coalition of partners are calling on the government to introduce a cost cap to ensure that necessary improvements are made. Their proposal would requiring landlords to cover costs up to £5000 – the figure the government previously agreed to consult on.

Emma Kemp, campaigner at 10:10 Climate Action said:

Already these measures didn’t go far enough – offering only minimum improvements to often vulnerable tenants in the worst housing stock – but with the cold homes loophole they could become toothless.

We have some of the leakiest homes in Europe – every winter we spend a fortune on energy that simply flies through our doors, windows and floors. Rather than letting landlords off the hook, the government should be backing tenants by closing the loophole and capping the cost for landlords instead to ensure fairness to all concerned.

Getting a grip on energy bills was a hot topic of the election, and the government says it wants to end fuel poverty by 2030. This loophole makes both harder. What better way to cut bills and fight climate change than to ensure all tenants live in warm, energy efficient homes?

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