Thank you, Deputy Presiding Officer. I welcome the committee's report, which recognises that the delivery of low-carbon housing in Wales offers significant challenges and opportunities. Domestic buildings are responsible for an important proportion of Wales's carbon emissions. However, it is important to understand that reducing emissions can be achieved in many different ways, and a range of solutions will be required, based on house type, tenure, energy performance, demographics, building usage and a range of other factors. The Minister for Housing and Regeneration and I, alongside our ministerial colleagues, are committed to transforming Wales into a thriving country in a low-carbon world.

In July, Cabinet agreed to make decarbonisation a priority area in 'Prosperity for All'. In December, we will ask Members to agree emissions targets for 2020, 2030 and 2040, and our first two carbon budgets. This will provide a clear decarbonisation pathway for Wales. Over the summer, we launched a consultation, seeking stakeholders' views on our approach to decarbonising Wales, and I was very pleased with the response. These responses are currently being analysed and will inform the development of our low-carbon delivery plan, which will be published in March 2019.

Our emissions from the residential sector accounted for 8 per cent of total Welsh emissions in 2016, and emissions from the sector have decreased 25 per cent since the 1990 baseline. We've already committed to the development of a new programme of action that will decarbonise homes in Wales by 80 per cent by 2050. This will have clear milestones and targets. We are currently developing this programme using specifically commissioned independent research to provide a strong evidence base. The decarbonisation of homes advisory group, which is made up of a wide range of external stakeholders, is helping us to develop and then deliver the programme.

At the moment, it is not possible to support the committee's recommendation for a low-carbon housing strategy in full, as it is still unclear what the research and the decarbonisation advisory group will recommend to Ministers. The report is due in the summer of 2019. But, just recently, I spoke at an event organised by Mark Isherwood, and I did commit to certainly being very happy to work at getting that strategy brought forward, and I think the advice that stakeholders gave me at that meeting was that a 10-year strategy would be required.

In the meantime, our innovative housing programme is being used to test low-carbon solutions. In 2018-19, it is open to both social landlords and the private sector. This is important as it encourages the SME sector in housing in Wales to start building again, but in a way that changes their existing practices. Through regional skills partnerships and various programmes of support, the Welsh Government is providing investment in training provision to ensure that the construction sector has the appropriately skilled workforce to deliver its targets for energy-efficient homes. Regional skills partnerships collate and analyse labour market information to provide the Welsh Government with information on existing provision levels against current trends, but they also work with employers and significant development projects to project future skills needs.  

Part L of building regulations is currently being reviewed to increase the energy efficiency of new homes and deliver, as a minimum, nearly zero energy. David Melding referred to a so-called performance gap, but I do believe this review will certainly address that, going forward. I will consider imposing more stringent standards if NZE does not meet our current energy ambitions. As part of the work to deliver the next changes to Part L, we will identify opportunities for future improvements beyond the current review and the timetable for achieving them.

Through our own programmes, we are driving high standards of energy efficiency measures and installation. With the closure of the feed-in tariff expected in March 2019, we will also need to look at how we drive forward reductions in emissions through renewable energy measures in homes. This year, we have awarded and mobilised contracts for the next phase of the Warm Homes programme. Nest and Arbed 3 contracts both stipulate whole-house assessments are undertaken to ensure the right solution is offered. This means we improve home energy efficiency and give people the help they need not to live in fuel poverty. We are making significant investment in this programme, investing £104 million between now and 2021. Our investment will also lever in up to £24 million of EU funding in addition to funding from the UK energy company obligation, and this will enable us to improve up to 25,000 homes.

We already have plans to commission a cost and benefit analysis of retrofitting homes, and that will include households that are in fuel poverty. This will better inform how best we help people out of fuel poverty in the future, whilst supporting our housing decarbonisation objectives. We are also leading the way by demonstrating to mortgage providers ways to incentivise preferential lending rates for low-carbon homes. The industry-led lenders project has provided a formula for affordability assessments that takes into account the energy efficiency of the property and can provide additional borrowing for more efficient homes. We introduced this formula into the Help to Buy—Wales affordability calculator in June this year.

Whilst we recognise the importance of moving towards zero- or low-carbon homes, we do not wish to introduce this into all schemes at present, but rather introduce this type of requirement over a period of time. The Wales stalled sites fund, for example, is designed to bring together a cohort of developing SMEs before we introduce such a requirement. We remain committed to consider all relevant evidence, and should further evidence come forward that supports the case for changes to taxation or policy, the Welsh Government will be happy to re-examine the case. Diolch.