Be Prepared for EPC Grade C Anyway

So I now read that in Scotland there is a proposal to force home owners to install a cold pump, (also known as heat pump), within two years of purchasing a property. I am sure sellers of warm overcoats that look just great when worn inside the home will be delighted at this news. Here is the story from the news wires:

Scots could be “penalised” with tax hikes for refusing to install heat pumps in their homes, under proposals unveiled by a Green minister in Humza Yousaf’s government.

A taskforce co-chaired by Patrick Harvie, the Zero Carbon Buildings Minister, (yes they have one of those), has recommended using taxation to “promote behavioural change” in line with the government’s ‘objectives’ of getting rid of gas boilers.

In a new report, it said local authorities could impose a council tax “premium” on households which fail to switch to zero emissions heating systems, such as heat pumps.

The taskforce also proposed hiking Land and Buildings Transaction Tax (LBTT), Scotland’s version of stamp duty, for the purchase of properties that have lower energy efficiency ratings.

It said the two taxes “offer the potential to influence home owner and purchaser decisions” around replacing gas boilers, with a massive acceleration in the number of heat pump installations required to meet government targets.

The report recommended that the “Scottish Government should review and publish, by the end of 2024, the potential of incentivising domestic property owners to increase levels of retrofit works through fiscal and taxation policy.

Among the other proposals for meeting the huge cost of the roll-out was getting homeowners aged over 55 to fund the installation of heat pumps by using equity in the value of their properties to provide the required cost.

However, it acknowledged that they may need this equity to provide income after retirement or to fund future care costs when they are elderly.

The report was published ahead of Mr. Harvie unveiling a public consultation this week on the Scottish Government’s strategy for decarbonising building heating systems. A ministerial statement is scheduled for Holyrood on Tuesday afternoon.

The SNP-Green government wants to introduce legislation requiring the “installation of zero or very near zero emissions heating systems”, with the new standard to be phased in for off-gas grid areas from 2025 and on-gas grid areas from 2030.

It has admitted that the average cost of installing a heat pump is around £10,000. (And the rest!). This is around four times the £2,500 cost of replacing a fossil fuel boiler.

Obviously, a few months ago there was a welcome reprieve on this Net Zero nonsense in the rest of the UK – when the government realised that landlords were going to exit the market in droves, leaving millions of tenants homeless if the government proceeded with its insane plan to force landlords to get to an energy performance level of grade C. That was great news and a little unexpected.

However, the Conservatives seem to have all but given up on any hopes of winning the next election and with Labour even more set on Net Zero and seemingly getting even more instructions from Brussels and Davos than the Tories, I can only see the demands coming back. Most likely, Labour will do as the Scots have done, just as Johnson oddly did on “convid”, with his administration seeming to ape Sturgeon by copying her ever more extreme and useless interventions, while “Dripford” in Wales often went even further.

So what is to be done?

Well two things – oppose these measures, obviously. Think about them when you come to vote, (if you still think voting achieves anything). (By the way, I do expect the Conservatives to bring back the requirements eventually).

But be prepared for the re-appearance and re-tightening of the Net (Nut?) Zero measures, including more requirements for landlords to further insulate properties. Hopefully, we may never see the cold pump proposal in the rest of the UK, as they clearly don’t work and cannot work in any housing stock more than 50 years old. Plus, there are very few installers, either in England and Wales or in Scotland.

But there is likely to be renewed calls for landlords to meet EPC grade B or C – and also pressure applied in all sort of ways to achieve that. So, think higher interest rates on mortgages, fines for non compliance and increased council tax rates and stamp duty rates, plus higher per KW energy costs for the refuseniks.

Thus, the screw is tightened. Suppliers of all goods and lenders who don’t comply (and who don’t increase the pressure on consumers will lose ESG points), which in turn effects their access to capital.

The noose is ready and the trap has been set. People have sleepwalked into this.

If Labour win and the requirement is for landlords to make changes to raise EPC scores quickly, there might be quite a scramble to get the necessary work done – and installation prices will rocket. So, perhaps proceed now with getting some of the insulation work done now on your let properties.

Oh, and if you are a non-landlord and happen to be reading this and thinking, “this does not effect me”, don’t worry, your time will soon come to spend a load of money on your home “to be compliant and to be seen to be doing the right thing”.

They are just picking off the easy low hanging fruit first – the landlords.

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