The retrofitting market should be the future of the UK building sector, but getting the policy right is key
The race to reduce carbon emissions and reach ‘net zero’ by 2050 will create a retrofitting market valued at between ￡3.5 and ￡6.5 billion per year. But for tradespeople and builders to invest their time, energy and money, they must have confidence that the market will be there in the long-term. On last week’s Clive Holland Show, Brian Berry, chief executive of the Federation of Master Builders came on to discuss the retrofitting opportunities for the nation’s army of small builders.
Clive Holland: What is the Federation of Master Builders stance on retrofitting?
Brian Berry: The FMB is supporting retrofitting because we see this as a great market opportunity for small builders across the country.
We have 28 million homes in the UK and most of those homes will benefit from some form of energy efficiency upgrades to make them much greener, cut carbon emissions and warmer, because with energy bills going up, you need to make sure the home is well insulated.
This market is worth between ￡3.5 billion and ￡6.5 billion pounds per year – if we can get the policy right.
We see this as a new market for small builders, but it would also benefit homeowners because they would have greener, more energy efficient homes.
It’s good for the government too because they are talking about reducing carbon emissions. Our homes contribute 20% of the country’s carbon emissions so if we are going to deliver ‘zero carbon’, we need to make sure our homes are greener and more energy efficient.
Holland: To what extent then is retrofitting the future of our industry then?
Berry: It should be the future. We’re not going to reduce carbon emissions unless we make our homes greener and energy efficient.
Government attempts so far haven’t been very good. The green deal ten years ago was a disaster. We had the green homes grant scheme during the pandemic, where the government introduced grants and took them away.
Last year the government published its Heat and Building Strategy, which had some good news in it, but it focused too much on heat pumps and not the fabric of the building.
If you are going to make homes more energy efficient, it is about the fabric – the windows, the walls, the roofing – rather than the heating.
The government has more thinking to do on this; we need more help for homeowners to upgrade to make their homes more energy efficient.
The government has to put more money into the retrofit market to get it started because once it starts, builders will have confidence to invest in retrofitting and consumers will know that this is the direction of travel.
Holland: Therein lies the problem – the builders that want to add retrofitting will look at the government’s past record…
Berry: You’re quite right. And it hasn’t been good. A lot of builders have invested money and then the market has been taken away.
We need to create the retrofit market and that requires long-term certainty. That is why [we’ve] been working with the construction industry to develop a National Retrofit Strategy; a twenty-year plan so that builders have the certainty the market has been created, and homeowners know if they invest the money, they have a chance of getting a return on it.
What we see in the Heat and Building Strategy is some of the [criteria] to do that – so all homes should be rated C for the energy performance certificate by 2035.
But how are we going to get there?
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They have talked about some grants to remove gas boilers but they’re very limited.
We need some ‘pump priming’ to get this market started.
They have said about social housing, which is a good start. But what I am concerned about is the owner-occupied market. There is very, very little help for homeowners.
Holland: Do you see [retrofitting] overtaking the traditional trades?
Berry: I don’t think it is going to be a major change for all the trades – we are still going to need carpenters and plasterers.
What we need, is for them to understand about the energy performance of the house. There would be some upskilling for all trades, but it is not going to dramatically change what they do.
There will be new jobs. There has to be a retrofit coordinator – somebody who can understand the energy performance of buildings and advise the trades about what needs to be done.
It has the potential to create a lot more jobs – over a 20-year period it could create as many as 500,000 new jobs. It is a fantastic opportunity – we just got to get it right.
We need the government to think long-term; not short-term. (Politicians only think about the next four years and the general election.)
This is a major infrastructure project – it should be treated in the same way.
Holland: What does the Federation of Master Builders hope will happen next?
Berry: I hope the government puts more into creating the retrofit market. I would like to see incentives for homeowners to upgrade.
I would like to see every home have a ‘building passport’ – it is expensive to do all the retrofitting [and] few people have the money to do the whole house at once.
But they can do it gradually.
If everyone knew what they could do and the return on the money, that would be a big step forward.
Let’s understand what can be done in every home and then sort out the funding going forward.
But the long-term certainty, the business certainty is crucial to get this market up and running.
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