Private renters face paying an additional £1bn in gas and electricity bills because of delays in the introduction of new standards forcing landlords to make their properties more energy efficient.
The government has been criticised for dragging its feet on enacting new proposals that would require landlords to improve properties to at least a C rating under the energy performance certificate (EPC) scheme.
Currently, privately rented homes only have to meet the less energy efficient EPC band E, making them more expensive for renters to heat.
More than 2.4m privately rented homes in England that fall below the C band could benefit from significant savings if landlords are made to comply with the proposed new minimum energy efficiency standards.
Ministers began a consultation on raising the minimum requirement for privately rented homes in 2020 – with a plan to force landlords to meet the C band standard for new tenancies from 2025 and existing tenancies from 2028 – but the government has so far not turned the proposals into legislation.
“Privately rented homes are often cold, unhealthy and are likely to cost the billpayer and taxpayer billions because of their poor insulation,” Jess Ralston, an energy analyst at the Energy and Climate Intelligence Unit (ECIU), said. “Encouraging private landlords to invest in their properties will lift local economies while saving the NHS millions.”
In January, the National Residential Landlords Association (NRLA) said that given government inaction the timeline for implementation starting in 2025 was in effect “dead in the water”.
Research by the ECIU estimates that if it takes an additional two years for the proposals to become legislation, and landlords to then be given time to comply, it could cost renters stuck in leakier band E homes £1bn.
With tenants responsible for paying for heating bills landlords have little incentive to upgrade the energy efficiency of their rental properties by investing in insulation, draught-proofing, double glazing and more efficient heating systems.
Almost a quarter of homes in the private rental sector are officially classed as “non-decent”, while the same proportion have tenants living in fuel poverty.
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A recent Citizens Advice report found that 1.6 million children were living in privately rented homes that are cold, damp or had significant mould.
“Questions are being asked about why something as simple as confirming a new standard is taking this long, when it could save households cash and generate growth at a time when UK growth is at best sluggish,” Ralston said.
In January, the Department for Business, Energy and Industrial Strategy said government support had in part helped the proportion of homes with an energy efficiency rating of C or above rising from 13% in 2010 to 46%.
“We are [also] investing over £6.6bn to help decarbonise homes and buildings, and to ensure all homes meet EPC band C by 2035,” a BEIS spokesperson said.