There is an intrinsically local dimension to decarbonising our homes and buildings, which makes local authorities critical to delivery. However, the schemes need reform to maximise their potential.
The government could take a series of near-term steps to improve local retrofit delivery immediately, while smoothing the transition to more comprehensive devolution. Our research identifies changes related to central government grant disbursement, planning laws and local energy planning that would address commonly faced challenges raised by local authorities, while laying the foundation for more in-depth reform.
- Funding and project design: The government should consolidate the various English local retrofit schemes, allocate funding on a three-year basis via “challenge funds” rather than competitive allocation, and increase local autonomy over household and area eligibility.
- Reforming the planning system: Align the National Planning Policy Framework with net zero and provide additional resource to speed up the planning system.
- Energy planning for net zero: Appoint a central body to help local authorities produce local area energy plans and give the Future System Operator regional system planning responsibilities, starting in areas with significant local grid congestion.
Why local government
Many local functions sit with local government, and the scope and nature of retrofit projects depend on a variety of local factors. Local authorities are clear candidates to run schemes optimised for their area. Furthermore, recent government grants for authority-led retrofit mean many authorities have already practised retrofit projects. Meanwhile, both major political parties have committed to further devolution, particularly in England, in the coming years.
This makes home retrofit an ideal candidate to increasingly devolve decision making down to authorities. Locally led retrofit should be supported alongside the other avenues for retrofitting homes in the UK, namely, the obligation on energy suppliers (ECO), and national schemes to subsidise private retrofits, such as the Boiler Upgrade Scheme.
There are important barriers to delivery that hold local authorities back. Progress on some barriers can be achieved by reforming central government policy, while others will require the combined action of central and local government plus the private sector to solve.
The current system has created significant inequality between authorities’ capacity to undertake home retrofit programmes. As a result, asking too much of local governments too quickly – without paying sufficient attention to co-ordination, procurement, and project management capacity – could create significant delivery risks. Our recommendations are targeted at enabling effective delivery at scale, including immediate changes to policy which align with deeper long-term reforms.