The Department for Business, Energy and Industrial Strategy (BEIS) has just announced a consultation to see if they can improve energy performance of domestic properties through various alternative measures such as a potential obligation on lenders to disclose their portfolio wide energy performance standard of properties, potential mandatory targets and/or an energy efficiency portfolio average.
The interaction of lenders at key points of the property cycle including development, acquisition and refinancing means that they play an important role in deciding whether a property is to standard or not. Improving awareness and performance using a top down approach may mean that the energy efficiency of the property stock improves. It would certainly bolster the Government's proposals to increase EPCs for residential properties (the subject of a separate consultation). But what will happen to low energy performing properties unable to refinance?
For further details of the Consultation, (which closes on 12 February 2021) and an opportunity to give your views, see here: https://www.gov.uk/government/consultations/improving-home-energy-performance-through-lenders
Whilst this could well be a step towards the UK Government meeting their net zero 2050 target, to what extent will lenders (and other property stakeholders) support these steps? Watch this space…
Lenders could have a role in building a market for energy performance improvements. The government has been engaging with lenders, their engagement organisations, and other financial stakeholders to better understand how government can encourage lenders to innovate.
https://www.gov.uk/government/consultations/improving-home-energy-performance-through-lenders
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