3. Statement by the Minister for Climate Change: Improving the Energy Efficiency of Welsh Homes

– in the Senedd at 2:36 pm on 8 November 2022.

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Photo of Elin Jones Elin Jones Plaid Cymru 2:36, 8 November 2022

(Translated)

The next item is the statement by the Minister for Climate Change on improving the energy efficiency of Welsh homes. And I call on the Minister to make the statement—Julie James.

Photo of Julie James Julie James Labour

Diolch, Llywydd. The cost-of-living crisis is in large part driven by energy price increases affecting the price of all consumables. Whilst this is having a detrimental effect on all our living standards, it is having a devastating effect on households who are least able to pay, driving families into fuel poverty. The Welsh Government has consistently called for a social domestic energy tariff, setting lower than standard tariffs to better protect low-income households and a windfall tax on the excessive profits enjoyed by energy companies. The UK Government recently committed to an average price cap of £2,500 until April 2023. However, I remain concerned that this fails to provide the appropriate targeted support to those who need it the most.

With the levers we have, the Welsh Government has acted quickly to introduce support to help householders struggling with the cost-of-living crisis. More than £380 million has been invested since October 2021. We've expanded the support available for the discretionary assistance fund until March 2023, committing a further £25 million. More than 332,000 households have received the £150 cost-of-living payment, and the winter fuel support payment of £200 has been paid to over 204,000 households. Nearly £4 million of funding is enabling the Fuel Bank Foundation to introduce a national fuel voucher and heat fund scheme in Wales for households who prepay for their fuel. Four thousand fuel vouchers have already been issued to support struggling households. The Warm Homes programme Nest winter fuel campaign, launched on 1 November, will provide much-needed advice and signposting to vital support services. Over 8,000 people contacted Advicelink Cymru as part of the 'Claim what's yours' benefit take-up campaign, helping to claim over £2.1 million of additional income.

However, the energy system is not functioning for the benefit of householders in Wales, and fundamental energy market reform is required. I continue to urge the UK Government to take action. With limited levers to change the energy market, Welsh Government’s focus is on improving the energy efficiency of homes in Wales. Our flagship optimised retrofit programme has allocated almost £60 million in grant funding this year, with indicative amounts of £70 million for the next two years. Channelling ORP investment through social landlords supports a testing and learning approach to how to decarbonise homes effectively and efficiently. We will learn from this work to expand to the private-rented and owner-occupied sectors. We've also made a number of improvements to the Warm Homes programme Nest scheme by installing solar PV and battery storage, enabling homes to use energy at source. Over £394 million has been invested to support more than 67,100 lower income homes to improve their energy efficiency. Increased funding of £35 million is expected for the next two financial years.

Whilst we support families through these difficult times, we cannot forget climate change and the challenge of decarbonising 1.4 million homes in Wales. The Welsh Government’s focus will continue to be on supporting lower income homes who are in fuel poverty to reduce their bills and their carbon emissions.

(Translated)

The Deputy Presiding Officer (David Rees) took the Chair.

Photo of Julie James Julie James Labour 2:40, 8 November 2022

We will continue to learn from previous and current programmes. Multiple Welsh and UK schemes have delivered real benefit for vulnerable households. However, we are dealing with the legacy of some very poorly designed and delivered schemes from a decade ago. I recently approved £4.5 million for schemes in Bridgend and Caerphilly county borough councils to fix over 150 homes let down badly by previous UK Government schemes. It is important that we learn from these mistakes to make a positive and lasting difference.

It is my intention to bring forward a replacement national demand-led scheme focused on homes in fuel poverty. In addition, I also intend to develop an integrated approach across all tenures and income levels to drive decarbonisation. The new demand-led service, which is expected to be procured next year, will replace the current Nest scheme, with a greater focus on decarbonisation. The additional integrated approach will follow, developing from the experiences of ORP and other Welsh housing initiatives. The first step is to encourage landlords to explore the possible use of ORP to deliver improvements to, for example, a whole small community action, rather than being a solely tenure-driven solution. This dual approach will support the development of a skilled workforce and expansion of the supply chain in Wales. The approach will also support those able to pay, providing confidence they are taking the right steps.

We are investing in a new a housing net zero carbon performance hwb to provide expert guidance on all aspects of decarbonising residential homes. The hwb will start with social landlords, but will be extended after the first year to help private landlords and home owners as well. We will also maximise the opportunity afforded by the energy company obligation scheme in partnership with local authorities. The next ECO4 has now launched, and is worth £4 billion over the next four years. Decarbonising and improving the energy efficiency of homes in Wales across all tenures, and how it might be funded, is very complex. It is also not the sole responsibility of Government. We've recently begun work with the Development Bank of Wales to look at funding options for the owner-occupied sectors. We are also bringing together a panel of experts from across the finance sector to work with us on evaluating options and shaping those viable funding solutions. 

Finally, Deputy Presiding Officer, urgent action is needed across all areas of society to reduce our emissions of greenhouse gases and build our resilience to the impacts of climate change. A draft strategy for public action and engagement was published on 20 October. This is one of the items being discussed during Wales Climate Week, which is 21 November to 25 November, and, of course, as Delyth said earlier, today is Youth Climate Week, which I'm very pleased to see as well. We encourage people to join us for a week of events and discussions on how we can create a greener, stronger, fairer Wales. Diolch. 

Photo of David Rees David Rees Labour 2:42, 8 November 2022

I have a lot of speakers this afternoon on this item, so, please, everyone, keep to your time limits. Janet Finch-Saunders. 

Photo of Janet Finch-Saunders Janet Finch-Saunders Conservative

Diolch, Dirprwy Lywydd. I'm sure the Minister doesn't need me to reminder her of the fact that Wales is lagging behind the rest of the United Kingdom in delivering energy-efficient homes, and this is confirmed by the consultation for the Warm Homes programme. Wales has the lowest proportion of dwellings with an energy performance certificate rating of C or above, at 28 per cent. In comparison, England, 30 per cent; Scotland, 42 per cent; and Northern Ireland, 49 per cent. This survey noted that, across the nations in Great Britain, Wales also has the oldest stock of dwellings. This survey found that newer properties were more likely to have energy efficiency measures, as demonstrated by 33 per cent using low energy lighting, in comparison to 24 per cent of dwellings constructed pre 1919. So, will the Minister agree that the Welsh Government's failure to build new energy-efficient homes for the future is having a negative impact on our climate change commitments?

I note that over £394 million has been invested through the Warm Homes programme, as of December 2021. The Welsh Government did invest £20.1 million in the Nest scheme in 2021, with a further £15.7 million of Welsh Government and European investment in the Arbed scheme. Of course, these programmes are very important in improving energy efficiency, but, as the Minister's already alluded to, although the UK Government, for some reason, was referenced, some of the programmes that have gone on before have not necessarily done everything they should have done. Nonetheless, the fact that Wales is starting from behind, with the oldest housing stock in Britain, means that the costs of the project, Minister, that you intend to roll out for this to go forward, surely, are going to have to increase. If we really want to get this done in a fast and cost-efficient way, we have to involve local businesses, including small and family-run companies, to build the new homes that we and others so desperately need. So, will you confirm, that, in addition to retrofitting, Minister, we also need to empower these small and medium-sized businesses to deliver energy-efficient housing that meets the need of local communities?

We all know there's a clear disparity between the energy efficiency of homes in rural and urban areas. Rural areas are more likely to have dwellings with lower EPC ratings than urban areas, with the opposite occurring for urban areas. During the winter, when people are already facing higher bills, many Welsh households will also be impacted by our particularly acute energy-efficiency problems and the impact will fall more heavily on the vulnerable. I, along with Members like Jenny Rathbone, am enjoying the inquiry that we're currently undertaking into retrofitting the housing stock in Wales. I don't say this too lightly, but I am aware of the challenge ahead of us here in Wales with the housing stock, and also the fact that it's no use pumping new technology into homes if they're less than basic energy-efficiency levels. So, Minister, would you agree with me that, during a cost-of-living crisis, the failure to deliver more energy-efficient homes will have a crucial impact on household bills, and this could be falling disproportionately on the rural and the elderly?

On the topic of higher bills, I have to raise the issue of the Welsh Government's commitment to tackling fuel poverty. Forty-five per cent of households in Wales are now predicted to enter fuel poverty. Broken down, this will result in 98 per cent of lower income households in fuel poverty, with four in 10 of those in severe fuel poverty. The Welsh Government says they are committed to no more than 5 per cent of households being in fuel poverty by 2035. Energy efficiency does have an important part to play in achieving this. However, Minister, I think from some of the submissions we've received from witnesses, given the size and scale of the problems facing us, we really do need to tackle this. And I would say this wholeheartedly: we need to do this cross party, but we need to really get on with it. Thank you.

Photo of Julie James Julie James Labour 2:47, 8 November 2022

Thank you, Janet. I'm not entirely certain where the questions were in that. But, just to say a couple of things, you should be very careful about statistics; they're very deceptive. You chose to look at the percentage of houses at EPC C, but, of course, we've already brought all social homes in Wales up to EPC D as part of the Welsh housing quality standard. And if you actually ever listened to anything that's said in Plenary, you'd know that we're about to launch the next Welsh housing quality standard, which I've referenced numerous times already. It seems to have passed you by. 

The British Government, since you brought this up, hasn't, of course, brought any of its social homes up to EPC D. It hasn't even attempted the task. The statistics you quote are heavily skewed in favour of the south-east. So, it's always important to, as I was once told by a law professor, read all the way to the end of the page. So, I would highly recommend you do that in looking at those statistics. 

In view of the other comments you made, there are three things to say. I referenced the UK Government schemes because they're the ones that have been failing and that we've had to step into the breach to save people from. It's cost us a lot of money to do that. It was morally the right thing to do. The UK Government should have done it, quite clearly. 

The fuel poverty thing, let's be absolutely clear, is entirely driven by the way that the energy market is pegged to the marginal price of gas. If the UK Government wanted to fix that, it could. It has a Bill going through the Houses of Parliament right now that does not fix it. It could fix it and it has chosen not to.

It's quite clearly nonsensical to charge renewable energy in the same way as you charge fossil fuel supply. On renewable energy, clearly, the cost of that is in the capital expenditure to build it. The supply is free—the wind is free, the sun is free. The Chancellor has not yet figured out a way to tax it. But, that's not the case with fossil fuels. You have upfront capital investment to build the plants that drive it, but also the supply costs money, and that's what's driving the problems in the energy market. So, the two solutions are really straightforward. First of all, properly fund renewables. I'll just remind you once again that we would have a tidal lagoon in Swansea if the Conservative Government had listened to its own Conservative adviser about building it, and then we would have a really serious supply of renewable energy already. Absolutely, the Conservative ex-Government Minister who recommended it said that it was a no-brainer and he was absolutely right. So, lots of things have been missed here. But, the bottom line is, unless we move, shift away from fossil fuels onto renewables, and we change the energy market to match that, then we will be facing this problem, well, until there's next a Labour Government. Diolch.

Photo of Mabon ap Gwynfor Mabon ap Gwynfor Plaid Cymru 2:50, 8 November 2022

(Translated)

Can I say that I enjoyed that response from the Minister to Janet Finch-Saunders, apart from the last sentence? I welcome that response. It is now almost a cliché to say that we are living through a period of unprecedented change. From Brexit to COVID, and now the war in Ukraine, this is all having a detrimental impact on the supply chain, with the costs of raw materials, production and transport increasing rapidly.

We know from the UK climate risk assessment that the housing stock of this state is not fit to deal with the two main climate change threats that affect public health, namely rain and floods brought about by high winds, and extreme heat. This is important because it is here in Wales that we have the oldest housing stock in Europe, with a third of the housing stock built before 1919. These homes are considered difficult to maintain. In addition to this, of course, a number of the properties in this part of Wales are listed, as I've noted several times. With old housing stock such as this, and with many listed buildings that cannot be retrofitted effectively, how is the Welsh Government going to ensure that most of the housing stock is not only energy efficient, but ensures a high standard of living for everybody?

Wales, of course, is considered a zone 4 weather zone, where there are close links between rain driven by wind, low quality housing and poor health. I was saddened to read recently about the death of a two-year-old boy in Manchester, Awaab Ishak, with the coroner linking his death directly to mold and damp in his home. The inquest found extensive mould on the walls and ceilings of the bathroom and kitchen. There was also damp and mould in a cupboard in the bedroom. The same is true of many homes in Wales, with mold and damp posing a direct threat to the health of thousands of people in social housing and in the private rented sector. The housing crisis is a health crisis, and climate change will only exacerbate this, so making homes more energy efficient is essential not only to combat climate change, but our public health emergencies. So, I would like to know what the Welsh Government is doing to respond to the health crisis through their actions in the housing sector. More specifically, what is the Welsh Government doing to reduce the presence of dampness and mould in the Welsh housing stock through their retrofitting programme?

One retrofitting model that experts in the sector do advocate is deep retrofitting, where individual homes are treated on an individual basis. This, of course, requires numerous skills, comprehensive training and a significant workforce. A retrofit programme on this scale would require a skills and training programme supported by the Government. This would ultimately reduce costs significantly, and would provide an economic boost by developing a skilled workforce across the country, providing economic benefit to all parts of Wales.

The Minister also mentioned the need to develop the workforce through ORP. So, there is an opportunity here to invest in a skills and training program to accompany the work that the Government is doing in the agreement with Plaid Cymru in developing Unnos. What steps are the Welsh Government taking to build a workforce that can provide for the needs of Wales in terms of increasing energy efficiency in the housing sector through retrofitting? Thank you.

Photo of Julie James Julie James Labour 2:53, 8 November 2022

Diolch yn fawr, Mabon. Just to say, I agree with much of what you say, in terms of the detrimental effect of poor housing on health. There's much evidence to show that housing is one of the most fundamental things that can improve quality of life and quality of health, so I absolutely agree with you there. One of the reasons we did the Welsh housing quality standard in the first place was to ensure that the social housing stock was brought to the right standard.

You may know—it has been the subject of other statements here on the floor—that we're currently looking at the regulatory framework for social landlords in Wales, with a view to making sure that landlords maintain their housing stock to the level that we want, as part of the regulatory framework. So, we'll be bringing that back to the floor of the Senedd in due course—not very long, I hope—to do that. We want the Welsh housing quality standard maintained at its current level, but then, Mabon, you will also have heard me say that, in the new year, we'll be bringing forward the next iteration of the Welsh housing quality standard to get up to the next level. We're currently in discussion with all of our social landlords about how to do that, so the social sector is then covered.

You'll be aware that we're about to implement the Renting Homes (Wales) Act 2016, subject to the Senedd agreeing the various regulations that are still to go through. I find myself touching wood at this point in time—it has been a long time coming. But, of course, the whole point of the Renting Homes (Wales) Act 2016 is to have houses in the private rented sector that are fit for human habitation, and that includes the issues that you raised. One of the reasons that we’ve stepped in to correct some of the UK Government’s schemes, which were cavity wall insulation schemes, generally speaking, is because they have caused real mould and damp. That is the problem when cavity wall insulation goes wrong. Actually, that just demonstrates why we’re doing the optimised retrofit, because lots of cavity wall insulation has been installed across Wales with really good effect. We always talk about the ones that have gone wrong, but it’s just that one size doesn’t fit all. So, in some houses it’s great, cavity wall insulation, if it’s correctly installed and it’s the right kind of house for it and it doesn’t soak up damp into the cavity and all the rest of it. In other homes, it’s proved a very poor, retrograde step, and that’s why we wanted to have this optimised retrofit programme, or the deep retrofitting as it’s called elsewhere, because we are absolutely looking at each type of house in Wales and we are absolutely trialling out a series of techs on an iterative learn and process programme to figure out for each sort of housing that we have in Wales, including the old housing stock and the listed buildings, what will work, what can bring that particular type of house up to the best standard it can get—that might not be A; that might be C—and then what to do with those types of houses that can only be brought to that level. I’m very fortunate in some ways, as I live in a very, very old house, and it’s a privilege to do so. I regard it as a trust for future generations. But, of course, it’s much harder to retrofit such houses, but they’re part of our culture and heritage. It’s an old Gower farmhouse. These things are important for other reasons as well, so it’s important to get this right.

Then, just to reassure, ORP is a collaboration between me and the Minister for Economy and the Minister for Education, because we are very aware that not only does it bring the houses up to standard once we’ve got all the tech sorted out, but also it allows us to skill the people who are fitting the technology that’s necessary. There’s a whole range of technology there, so we would be working with our FE colleges to make sure that people coming forward who want to do gas boiler fitting, for example, are also being trained to put in a whole variety of other methodologies, and then we will be talking about a reskilling programme as we come away from gas boilers for all of the people out there who currently work in that industry to be able to put in air-source heat pumps, ground-source heat pumps and a whole variety of other things that are available.

And, as I said in my statement, one of the last pieces then is the owner-occupied section. We’re talking to the Development Bank of Wales now as we’re starting to be able to roll out ORP about what set of grants and loans will be appropriate for owner-occupiers, and what advice we can give them through the energy advice service. So, I think we’re very much on the same page apart from that last sentence, which I’ll persist in believing.

Photo of Jenny Rathbone Jenny Rathbone Labour 2:58, 8 November 2022

Thank you very much for your statement. It poses as many questions as it answers, but it’s useful to know the information you’ve given. This funding of £35 million for the Warm Homes programme for the next two years, is that per year, or for the two years?

Photo of Jenny Rathbone Jenny Rathbone Labour

Okay, so it’s £35 million for two years. Okay, that’s good. I think one of the problems we have is that people don’t know how to approach this—they’re not environmental experts. So, I welcome the fact that you are going to create this hub, but I’m concerned that, in the first year, it will only be available to the social housing sector, because whilst there is a huge threat from the massive hike in energy prices, it’s also an opportunity to get people to focus on the need to decarbonise, which we’ve all got to do anyway. I do think that people are very confused about what they should do with their particular property and they need—

Photo of David Rees David Rees Labour 2:59, 8 November 2022

Jenny, please can you ask a question?

Photo of Jenny Rathbone Jenny Rathbone Labour

—independent advice in order to do it. So, the question is why do you not think it’s possible to extend it to anybody who needs this free advice from the first year.

Photo of David Rees David Rees Labour

Thank you. I’ve got so many people who want to ask questions, I’ve got to keep you to time.

Photo of Julie James Julie James Labour

A very short answer, Jenny, is because we haven’t yet got all the learning out of ORP. So, the energy advice service is there to help owner-occupiers, but we’d like that to be much more specific, and we want to be sure that, when it is specific, it’s correct. So, we’re going to trial it out on our social housing providers, which we can de-risk, before we’re able to offer it. But people who want to do it now can get advice from the Welsh energy advisory service of a slightly more generalised nature about what they should do to their home for most efficiency. 

Photo of Sam Rowlands Sam Rowlands Conservative 3:00, 8 November 2022

Thank you, Minister, for bringing forward today's statement. As we know and as acknowledged, Wales does have an older and less energy-efficient housing stock compared to other parts of the UK, and it's part of the reason I raised the point earlier with the Trefnydd in questions about the opportunities of ECO4. So, thank you for acknowledging some of those opportunities in your statement today as well.

An idea has been mooted in the past, Minister, and also mentioned to the Minister for Finance and Local Government, and it's actually where an element of council tax could be aligned to the energy efficiency of homes, similar to the way in which cars are taxed around their emissions. This, of course, could help incentivise people, alongside grants, to make their houses more energy efficient. I'm conscious, as I'm sure you are, of your Government's commitment to reforming council tax in Wales in the co-operation agreement with Plaid Cymru. So, in light of this, Minister, what are your thoughts on the possibility of an element of council tax being based on the energy efficiency of someone's home? And will you carry out further work on this idea with the Minister for local government? Thanks.

Photo of Julie James Julie James Labour 3:01, 8 November 2022

Yes, Sam, I think we absolutely do need to look at an incentive programme for people. One of the mysteries of the world to me—you and I have discussed this when you had a previous hat on, as did I—is why house prices don't reflect various improvements. So, a huge mystery to me is why fully enabled broadband houses are not more expensive than ones that aren't, because if I was buying a house that didn't have any broadband in it, I'd knock the cost of putting the broadband in off the price of the house. So, I don't understand why that hasn't worked in the market, and energy efficiency is exactly the same. When you're buying a house, surely the fact that your bills are going to be £18 a year makes a huge difference to how much you're prepared to spend compared to several thousand pounds a year. I don't understand why the market hasn't worked. 

So, we will need to look at—and Rebecca Evans and I have already started some preliminary conversations about how this might work—an incentive programme for owner-occupiers, but I will say that is in the beginnings of that conversation. As I referenced in my statement, there are discussions with the Development Bank of Wales as well about loans and grant schemes, because we want to get this right. And as I've just said to Jenny Rathbone, we want to be sure that the advice we're giving people about investing their money produces the result that they are looking for in terms of energy efficiency, and that the capital investment they make is reflected in the value they get back, both in decreased energy bills, but also in the value of the asset. So, we're working on it, we're absolutely looking at incentives, and all good ideas are very welcome.

Photo of Sioned Williams Sioned Williams Plaid Cymru 3:02, 8 November 2022

(Translated)

I'm a member of the Equality and Social Justice Committee that held an inquiry into the Warm Homes programme, making recommendations in terms of lessons learnt and improving the new version of the programme. In responding to the recommendations, the Government suggested there would be an update on the next version soon after the summer recess. Your statement today, now that we are in November, is late and vague in terms of setting a clear timetable. If the procurement process, as you mention, is to happen in 2023, is it then after April 2024 that the new programme will be launched, a year later than expected? And although you mentioned some changes to the current Nest programme, why wasn't there mention of valuable changes that could be done urgently, given that fuel poverty for those who qualify is getting worse in the current crisis within the current Nest scheme, for example, combining the work on the fabric of homes, on insulation, with the work of fitting heating systems in the least energy-efficient homes? 

Photo of Julie James Julie James Labour 3:04, 8 November 2022

Thanks very much for that. As I said to a couple of other people as well, first off to say that the new programme will begin before next winter. So, we will procure it and start it before next winter, just to be really clear, and there's a clear timetable for doing that and I'm very keen, obviously, that we don't go into yet another winter without doing it. But, we do want to learn a lot of lessons about some of the well-intentioned schemes from the past. Siân Gwenllian, I know, has problems in her constituency, other Members have problems, and I have them in my own, from schemes that were largely successful, but because a one-size-fits-all approach was taken, the houses that weren't suitable are really left in difficulty, and it's not always that we can help. So, we haven't been able to help all the households across Wales that have found themselves in difficulty for various complicated contractual issues around the way that those programmes were rolled out.

So, I really do think it's important to get it right, and that we don't actually inadvertently make a minority of people worse off than they were in the first place. And I'm also very keen to make sure that we can develop Welsh supply chains for this. So, you know, at the moment, some of this technology is really expensive, and the cost-benefit analysis is quite difficult, even with energy prices the way that they are. But, if we do it properly, then we will be able to get a supply chain in place that reduces the cost of that technology much more rapidly than would otherwise happen. There are lots of examples of Government procurements being able to do that, and I'm very keen to get the green jobs in Wales as well as the efficiency for the houses.

On the Nest scheme, we have been looking for some time at a way to improve that scheme, because you know that, largely, it's been putting more efficient gas boilers in in place of very inefficient gas boilers, and whilst that does of course produce some benefit for the household, with the current cost of gas, it's not producing much benefit—and anyway, it doesn't help the climate emergency, which is one of the biggest problems we've all got. So, again, trying to morph the programme, so that it doesn't take away some help from the least-able-to-cope households, but also doesn't make the problem worse in the future, has been more problematic than I would have liked it to have been, and that's the truth of it. So, what we want to do is get some programmes in place that help the most people do the best thing for their home, whether through the social landlord programme or through our councils or through our leaseback schemes or with the private rented sector.

And then, the last piece of that jigsaw is how to incentivise the private rented sector landlords to actually stay in the sector and invest, rather than just leave the sector, if we put obligations on them. So, having conversations with the private rented sector landlords, through various organisations, about the best way to incentivise that. Because most landlords in Wales only own one or two houses; we haven't got any huge landlord agents, or not very many huge landlords. So, making sure that those people stay in the sector and don't just sell up to the highest bidder is a really important part of what we're trying to do as well.

Photo of Mike Hedges Mike Hedges Labour 3:07, 8 November 2022

I very much welcome the statement by the Minister. I agree with the Minister that the cost-of-living crisis is, in a large part, driven by energy prices, as increases are affecting the price of not just gas and electric but many other consumables. Whilst this is having a detrimental effect on all of our living standards, it's having a devastating effect on households who are least able to pay, driving families who were just surviving into fuel poverty. I am pleased that the Welsh Government's focus will continue to be on supporting lower income families who are in fuel poverty, to reduce their bills and carbon emissions. I agree that decarbonisation, improving the energy efficiency of homes in Wales across all tenures, and how it is going to be funded is obviously complex. In Swansea East, as the Minister knows, there are a large number of retired people living in poor energy-efficient homes that they own. Will the Welsh Government consider ending the Help to Buy scheme, which has the effect of inflating house prices, and use that money to provide loans to owner-occupiers and private landlords to improve energy efficiency? And would the Minister like to comment on the Pobl scheme in my constituency?

Photo of Julie James Julie James Labour 3:08, 8 November 2022

Just on that last one: it's a great scheme, isn't it? So, the kind of collective action that you get when you're able to implement the sorts of collective energy efficiency schemes that you get in that instance is an example, and we're hoping to roll that model out. So, for Members who aren't familiar with it, we've got a new estate and an old estate coming together with an energy efficiency scheme that allows those with the ability to put good solar panels on their homes to share their energy out across the scheme, to provide EV charging points, and all the rest of it; it allows Economy 7 to work for white goods across the scheme. There's a whole series of things that you can do with the collective power of coming together, basically. So, it's a great scheme. I've managed to visit it a couple of times, and we will be looking to roll that out with the companies that have been involved in that—with the social landlord company and the energy companies that have been working with us. So, that's a really excellent example of what can be achieved.

Just in terms of the Help to Buy, it's a bit more complicated than that. We use Help to Buy to drive other improvements in the building industry. So, actually, builders who don't build to particular standards don't get Help to Buy, and that's been very helpful in driving some of those standards. We also use financial transactions capital, which, Mike, I know you're familiar with, but it is an arcane art, so it's not quite as easy to swap that out into individual householder loans. We are though looking, with the Development Bank of Wales, at rolling out grant and loan schemes to owner-occupiers in exactly the circumstances that you're talking about and, actually, being able to target people who get the single-occupier discount, who are often older people who've lost a partner and are in that exact position. So, we have a way to identify people, so that we can consult on it. So, we are looking to do exactly that.

Photo of Mark Isherwood Mark Isherwood Conservative 3:09, 8 November 2022

I just have two questions, as chair of the cross-party group on fuel poverty and energy efficiency, which have come from the group. We heard reference earlier to the Equality and Social Justice Committee inquiry into fuel poverty and the Warm Homes programme, and recommendations for the Welsh Government to ensure that the programme embeds the fabric and worst-first approach to retrofitting, as well as targeting the poorest households and the least efficient homes, being bigger in scale and greener in interventions, allowing for multiple measures to be installed. In your previous responses, you have, I think, addressed some of those points, but how in particular will you ensure that the programme embeds the fabric and worst-first approach in the least efficient homes?

Secondly, as we've also heard, Wales has some of the oldest and least thermally efficient housing stock compared to the UK and Europe. Free energy efficiency measures are being rejected by many people, as they're seen as inflexible and incompatible with the buildings they reside in. You've already explained in part how you will tailor energy efficiency measures to adapt to the various different types of buildings that exist in Wales, but specifically, given likely delays to the next iteration of the Warm Homes programme, what consideration has the Welsh Government given to enabling the current Nest scheme to make more appropriate fabric improvements to insulate qualifying fuel-poor homes, whilst also supporting them to replace inefficient heating systems in light of the closure of Arbed and the anticipated increase in Nest's budget?

Photo of Julie James Julie James Labour 3:11, 8 November 2022

Well, you sort of answered your own question a little bit there, Mark. But, as I said before, we are absolutely looking at a fabric-first, worst-first kind of approach, but it's very difficult to just target one house sometimes. So, in my statement, I alluded to the fact that we're looking at community energy programmes. We're working with local authorities to do an energy map across Wales, so that we know where communities with the least energy-efficient housing are to see if we can do a community upgrade that will allow us to use social housing levers to help the whole community come up, if you like. So, it's quite difficult to just target one house in the middle of a cluster otherwise. We're also, as I've said many times, looking to make sure that we do the right thing for the right house.

On Nest, I just don't have enough money to do everything that I'd like to do to everyone's house. So, trying to do something for a large number of people as opposed to a lot for a smaller number of people is always one of the most difficult balances that we have. So, we constantly look to see whether it's better to help more people do one thing than it is to help very much fewer people do everything, and I'm afraid that's one of the balances we're constantly wrestling with. I'm very happy to work with the committee about where to hit the right balance for all of that.

Photo of David Rees David Rees Labour 3:12, 8 November 2022

(Translated)

Finally, Sarah Murphy.

Photo of Sarah Murphy Sarah Murphy Labour

Diolch. Minister, thank you for the statement today. The energy efficiency of homes continues to be a key issue for my constituents, especially when we do have some developments in the works at the moment, like the regeneration of Porthcawl. There's a real feeling from the community that they would love to have them as green and all of the things we were talking about today, really—energy efficient, built for the future, and cost-effective. At our Porthcawl region Dragon's Den event last year, Sero Homes actually came in and did a presentation, which they really loved. I know that you're aware of them. And, also, I've spoken with Porthcawl's third age organisation, who stress the need for solar panels in all homes, including those built by private developers, and that's the crux of my question today. It's about those private developers, because Bridgend County Borough Council councillors are really keen to ensure that homes built in the private sector also meet these demands, by asking them to build houses with energy-efficient provisions, like solar panels, taps, et cetera. So, will it be possible for you to meet with Bridgend County Borough Council and me, especially as we're looking at the Porthcawl regeneration at the moment, to see what we can do about this private development, so that it ticks all of those boxes for all of us?

Photo of Julie James Julie James Labour 3:14, 8 November 2022

I'd be more than happy to meet with you and the council, and the developer, indeed, Sarah. We have brought forward changes to Part L of the building regulations. They are technology neutral, so we're saying that they need a 37 per cent change in the efficiency, but not that you need to do that via solar panels or an air-source heat pump, for all the reasons I've spoken about earlier. 

The other thing we're having a look at is what we can do about making sure that builders who are building out planning consents actually build to the most recent standard, because, at the moment, as Members across the Chamber will know, once you've started a planning consent, you can build it out. So, we still have homes being built without sprinklers in them because they've started the planning consent and they're not going to the most relevant. Now, we tried to incentivise the house builders to do that. Lee Waters and I have a construction forum, and we meet with them very regularly. We try to put a lot of pressure on them to build to the most recent standard. I am taking some legal advice on whether there's anything we can do to limit the amount of time you can take advantage of a planning consent once you've started before you need to implement the most up-to-date regulations for all sorts of reasons. I hope we'll be able to address some of that in the building safety Bill that we'll be bringing forward, which is mostly affecting high-rises, but will have other effects right across the piece.

Photo of David Rees David Rees Labour 3:15, 8 November 2022

(Translated)

I thank the Minister.