As parliament prepares to implement a new Bill to reduce the carbon emissions of buildings, Phil Wright takes us through the pros and cons of this legislation, and anticipates its effects on existing buildings
There is a tendency to view almost any new piece of legislation with a cynical and jaundiced eye but a new Bill making its way through parliament must be the exception. It has the inelegant but succinct title of The Management of Energy in Buildings Bill, and brokers and insurers should keep abreast of it. This Bill will have a significant impact on the large and flourishing property world, and it could also open up the prospect of insurance products tailored to satisfy new areas of concern.
Few will now deny that the pollution of our atmosphere in the form of carbon emissions is having an adverse effect on our climate. The European Union is starting to take action, and among its initiatives is the drive to reduce substantially the quantity of carbon dioxide being emitted into the atmosphere by buildings. The target set is a 10% reduction from existing buildings and a 25% reduction from new buildings.
All EU member states are committed to introducing measures by the beginning of next year, and the UK government's plan is to have the Management of Energy in Buildings Act on the statute books by early January.
Hopefully, the impact of this new legislation will be mostly positive and at relatively modest cost. The Act will be enabled through amendments to Part L of the Building Regulations 2000. It will apply to new, as well as existing, residential dwellings and commercial buildings. With approximately 25 million dwellings in the UK and around 4.4 million commercial properties, that's an awful lot of buildings.
Pros and cons
Focusing on commercial properties alone, what pros and cons will the new Act and amended building regulations bring?
First, let us consider the plus points. The planet will be protected through lower carbon emissions and energy bills will be reduced. This is a significant issue, and it will become more attractive as gas and electricity prices soar. In addition, let-ability and saleability of properties that can demonstrate really good energy performance will improve.
By comparison, the minus points seem quite minor. Architects, designers and builders must embody the requirements in all new buildings. There will inevitably be a cost associated with building in more effective insulation, providing more efficient heating and cooling systems, and installing clever energy management and monitoring equipment. There will also be a cost associated with engaging specialists and consultants to advise on implementing the regulations to new buildings and, more particularly, to existing buildings.
Another potential minus point - for those who decide to do nothing - is that they may find themselves with inefficient buildings that prove difficult to let or sell.
What about penalties under the Act for failing to comply with the new regulations? Are there any new ones relating specifically to energy performance? It would appear not - nor is there any mention of who is going to police or enforce the Act or Part L of the buildings regulations.
It is clear that consideration is being given to this question; however, it will not be easy to police. Does this mean the Act and new regulations will have no teeth? No, because the economic drivers will be more than sufficient, especially where commercial premises are concerned.
One probable and beneficial effect will be the spur given to developing innovative energy solutions across the whole spectrum of building design. Already, there is a groundswell of activity in the UK, and public concern and awareness are both growing. A diverse range of industries and trade bodies are taking initiatives that will lead to better construction materials, more efficient heating systems, energy-efficient passenger lifts, sophisticated control and monitoring techniques and, of course, the use of zero or low-carbon-emission energy sources.
By way of an example, is worth considering the obligations placed on the owner of an existing office block and the range of solutions available.
Firstly, a small but important part of the regulations is the requirement to display prominently the performance standard for the building - the Energy Performance Certificate.
It is expected that this notice will have a similar appearance to those appearing on white goods, such as refrigerators and washing machines. Any interested party will be able to see at a glance the performance rating of the building, both the theoretical value and the actual measured performance. What a good selling point that could turn out to be for some buildings!
Behind this is the monitoring of the energy consumption of the building. This includes the use of devices and measures to conserve heat, to generate energy efficiently, to prevent overheating, to control air flows and optimise the performance of machinery such as lifts and escalators, and systems such as lighting.
It is not anticipated that there will be only one solution to reducing the carbon dioxide emissions from an existing building. A combination of improvements will need to be applied if the targets set by the government are to be met. It could start with a thermographic survey of the shell of the building to determine where heat is being allowed to escape. Electricity consumption data can be obtained from the supplier to determine optimum profiles. Only simple adjustments to environmental controls and timers may be required to achieve optimum values with significant savings in energy costs.
A more efficient, well-maintained and monitored heating and air-conditioning plant can greatly reduce the consumption of hydrocarbon fuels. The use of efficient condensing boilers will become more widespread, and one of the options being considered by government is the need for a periodic inspection regime for heating boilers.
There is little doubt that the energy performance of buildings is going to be high on the agenda of property owners and building managers going forward. Many of the nation's leading property owners are ahead of the game, already enthusiastically looking at the advantages of compliance.
Bearing in mind the magnitude of the market affected by these regulations and the significant impact of statutory requirements, brokers will be affording their clients a valuable service by keeping them informed and abreast of developments.
The really good thing is that we will all benefit in the long run. Let's hope the government provides every possible encouragement and incentive to make it happen.
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