Saving energy at home could take 200 years to repay its cost

The cost of installing energy-saving measures such as solar panels would take more than 200 years to recoup in reduced bills, according to research published today.

The Energy Performance Certificates which are now required with all Home Information Packs for houses with three or more bedrooms list eight measures to secure a high rating of A or B against a poor rating of F or G.

But the study from the Royal Institute of Chartered Surveyors shows that some of the measures, such as solar panels to heat water, would cost £5,000 to install but reduce average bills by only £24 a year and would take about 208 years to pay back.

The RICS data shows that putting in all eight measures, including insulation, condenser boilers and double glazing, would cost £23,547. This would knock only £486 off fuel bills and would take 48 years to recoup.

Ministers have argued that the energy performance certificates would reduce carbon emissions and shave hundreds of pounds off household bills, making them an attractive selling point. But the cost of double glazing would take 124 years to recoup in lower heating bills while underfloor insulation would take 54 years.

Even loft insulation would take 13 years to produce savings in utility bills. “People on average spend 16 years living in one property, making most of the EPC energy saving measures financially unattractive propositions,” said RICS. Ten per cent stay in their home for less than five years, and about 12 per cent less than three years.

The organisation is now pressing ministers to reduce the 17.5 per cent VAT rate paid on energy saving measurs to 5 per cent or zero. But they also want the Government to provide grants to give householders a financial incentive to reduce carbon emissions.

“The Government needs to do a lot more than just introduce a ‘fridge style’ energy rating system to encourage people to take up energy saving measures,” said Jill Craig, RICS Head of Policy and Public Affairs.

“RICS has been calling on government to reduce the level of VAT applied to all energy saving measures and to provide an attractive grant program to aid real change. If this Government is really serious about combating climate change they have to turn their big talk into even bigger actions.

“Efforts must be focused on the bulk of the housing market, made up of older homes from the 1920s1960s, that produce twice as much CO2 as a homes built after 1995. The EPC should be applied flexibly to all residential property, not just those that are being bought and sold.”A review of the whole of the residential housing sector begins on Monday which will consider the effectiveness of energy saving measures.

The inquiry, which will be chaired by Sir Bryan Carsberg, former director general of the Office of Fair Trading, will examine the benefits and drawbacks of Home Information Packs. It will also examine current practices in buying/selling and renting and letting property before drawing up recommendations on the regulation of estate agents and letting agents.

The commission, sponsored by RICS, the National Association of Estate Agents and the Association of Residential Letting Agents, will take evidence in public hearings. Yvette Cooper, the housing minister, will be one of the first witnesses to be invited.
Jill Sherman
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Solar heating will pay for itself ... if you wait 208 years

There's good news and bad news if you follow the energy-saving advice in your Home Information Pack.

On the positive side, by installing solar heating you'll be helping the planet and start saving money.

But the bad news is that it will take 208 years to recoup your outlay - meaning at least that your great, great, great, great grandchildren should be laughing.

The research by the Royal Institution of Chartered Surveyors found payback times for energy-saving projects on an average three-bedroom terraced house range from five years for cavity wall insulation to more than 200 years for solar heating.

Those installing double glazing face a 124-year wait while an energy-efficient condensing boiler could take 38 years.

Even a more basic measure such as loft insulation will take 13 years before energy savings amount to the same initial outlay.

Given that we spend an average of 16 years in one property, RICS says we are unlikely to be spurred into shelling out for some of the schemes.

It highlighted VAT as being a major factor in increasing the length of time before homeowners make savings and called for a grants system to make improvements more attractive.

The study heaps yet further controversy on the Government's troubled HIPs scheme.

Jill Craig, RICS head of policy and public affairs, said: "RICS has been calling on Government to reduce the level of VAT applied to all energy-saving measures and to provide an attractive grant program to aid real change.

"If this Government is really serious about combating climate change they have to turn their big talk into even bigger actions.

"Efforts must be focused on the bulk of the housing market, made up of older

homes from the 1920s-1960s, that produce twice as much CO2 as homes built after 1995.

"The Energy Performance Certificates should be applied flexibly to all residential property, not just those that are being bought and sold."

The certificates are supposed to encourage individuals to make energy- saving changes to properties to help reduce carbon emissions.

However, property owners will have an incredibly lengthy wait to get their money back even on more basic measures.

For example, the payback time for loft insulation is 13 years and 38 years for hot water cylinder and pipework insulation.

At present Energy Performance Certificates are compulsory only for homeowners selling their properties, which is thought to account for 6.9 per cent of homes.

The cost of having a house's energy performance assessed is between £100 and £150.

HIPs have been blamed for a 37 per cent fall in the number of family homes coming on to the market.

The packs became compulsory for homes with three bedrooms a month ago and for those with four or more in August.

Estate agents claim the regime is driving sellers out of the market, creating a property famine.

HIPs appear to be driving away the 20 per cent of sellers who have, in the past, put their home on the market "on spec" to see if they can find a buyer or get a good price.

RICS believes HIPs could cause real damage to the property market, which is fragile at the moment.

The market has also slowed down in the wake of higher borrowing costs, caused by five base rate rises in the past year and the impact of the global credit crunch.

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Gore wins Nobel Peace Prize for climate

Al Gore won the Nobel Peace Prize today for warning the world about the dangers of global warming, and leading the campaign to persuade governments and individuals to reduce their reliance on fossil fuels.

The former US vice-president will share the £750,000 prize with the International Panel on Climate Change (IPCC), the United Nations panel which has worked for two decades to establish consensus on the science of man-made warming.

Mr Gore said tonight that climate change is the most “dangerous and urgent challenge” the world faces at the moment and said it is time to “elevate global consciousness” about the challenges of global warming.
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Insulation the 'most important' energy saving step

Landlords in England, Wales and overseas hoping to increase the energy efficiency of their homes in order to reduce costs in the long run have been advised that improving insulation and installing a new boiler are two of the most effective ways in which this can be achieved.

Sam Turnbull, co-founder of DownwithCO2.co.uk, revealed these measures had been found to be both successful and simple.

"Evidence shows that insulating the loft and insulating cavity walls are important and easy steps to take," he explained.

"On top of that there is improving your boiler. It is one of the most important users of energy in the house. These options may not be as trendy as putting a wind turbine on your house but they do have the most impact."

Ensuring a home is properly insulated is also relatively cheap - and even free for those on benefits.

Mr Turnbull also recommended that landlords replace their existing light bulbs with energy-saving alternatives - especially as the latter are coming down in price.

This article was brought to you by holidaylettings.co.uk, the UK's No.1 holiday home website.
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