A Green Stimulus for Housing - The Macroeconomic Impacts of a Uk Whole House Retrofit Programme

This resource, published by the New Economics Foundation, is titled "A Green Stimulus for Housing - The Macroeconomic Impacts of a UK Whole House Retrofit Programme." The report is authored by Donal Brown, Hanna Wheatley, Chaitanya Kumar, and Joanne Marshall, and aims to highlight the economic and environmental benefits of retrofitting homes in the UK.

The document outlines the pressing need for a green stimulus in the wake of the COVID-19 pandemic, which has significantly impacted the global economy. The authors argue that a robust fiscal stimulus, targeting whole-house retrofits, is necessary not only for economic recovery but also for meeting the UK's climate change targets. The report suggests that retrofitting around 9 million homes could save approximately 15% of total domestic energy demand.

The proposed retrofit program is expected to generate a substantial number of jobs. Initial projections indicate that the initiative could create 117,811 direct jobs in the first year, peaking at 382,885 by the fourth year. This translates to an average of 294,527 new jobs annually between 2020 and 2024, marking a 22% increase in total construction employment. The broader economic impact includes an anticipated GDP increase of 1.58% (or £36.34 billion) by 2023/24.

The report emphasizes the environmental benefits of a green stimulus. It estimates that implementing the retrofit measures could result in emissions savings of approximately 19.23 million tonnes of CO2 per year by 2023/24, which is about 21% of the 2019 emissions from UK homes. This cumulative reduction could surpass the UK's fourth carbon budget targets, highlighting the urgency of the initiative.

To achieve these ambitious goals, the report outlines several funding scenarios. It recommends an average public capital investment of £8.66 billion per year from 2020 to 2024, aimed at supporting low-income households through grants. Additional financial mechanisms such as green mortgages and zero-interest loans are also proposed to encourage retrofitting. The report suggests that the government should fund a National Retrofit Taskforce to oversee the program, ensuring that homes achieve an Energy Performance Certificate (EPC) rating of C by 2030.

Central to the success of the retrofit strategy is a "whole-house" approach, which integrates various energy efficiency measures. This method contrasts with the historically fragmented approach and aims to optimize the overall performance of homes. The report advocates for a comprehensive strategy that incorporates energy efficiency improvements, renewable energy sources, and enhanced heating systems.

Looking beyond the immediate recovery, the authors stress the importance of maintaining momentum post-2024. They call for phased minimum EPC standards and a prohibition on new fossil fuel heating systems in existing homes. The report emphasizes that a green stimulus for housing is not merely a response to the pandemic but a long-term strategy for sustainable living and economic resilience across Europe.