The government has scrapped its flagship green homes grant scheme, the centrepiece of Boris Johnson’s promise to “build back greener” from the Covid-19 pandemic, just over six months after its launch.
The abandonment of the £1.5bn programme, which offered households grants of up to £5,000 or £10,000 to put in insulation or low-carbon heating, leaves the UK without a plan for tackling one of the biggest sources of greenhouse gas emissions.
People who have had their applications for vouchers under the scheme accepted will receive any money owed, but no new applications will be accepted after the end of this month.
Green campaigners said the scrapping of the programme – the only major green stimulus policy yet announced by the government and originally expected to create tens of thousands of green jobs – came as a serious blow as the government prepares to host vital UN climate talks, called Cop26, this November.
Ed Matthew, campaigns director at the E3G thinktank, told the Observer: “The demise of the green homes grant is an embarrassment [before Cop26], and a disaster in terms of the UK getting on track to net zero [carbon emissions]. Emissions from buildings and transport have flatlined over the last 10 years. If we don’t have programmes to tackle this, we have no hope of meeting the net zero target.”
The green homes grant has been troubled since its launch last September, after it was announced in July as the central plank of the government’s bid to “build back better” and create new green jobs to help the economy recover from the pandemic. There were more than 123,000 applications for the grant by the end of February, but only 28,000 vouchers had been issued and only 5,800 energy efficiency measures had been installed.
Builders complained of excessive red tape in registering for the scheme, while households found it difficult to access. A US company was awarded the contract to administer the grants, but a Guardian investigation found numerous people unable to get a response. Many people were given conflicting advice, while builders have complained that heat pump installations in particular have been stymied by the rules.
Last week, a select committee of MPs delivered a damning assessment that found the scheme “botched [in] implementation … the administration seems nothing short of disastrous”. Far from creating new green jobs as had been promised, the environmental audit committee found some builders had laid off staff owing to problems with the scheme. The MPs recommended an urgent overhaul.
The government said on Saturday that an extra £300m would be directed towards helping people on low-incomes gain access to energy efficiency improvements, through local authorities.
Kwasi Kwarteng, the secretary of state for business and energy, said: “Upgrading the country’s homes with energy efficiency measures means we can cut emissions and save people money on their energy bills. Today’s funding boost will mean even more households across England are able to access these vital grants through their local authority. This latest announcement takes our total energy efficiency spending to over £1.3bn in the next financial year, giving installers the certainty they need to plan ahead, create new jobs and train the next generation of builders, plumbers and tradespeople.”
However, overall the amount of money earmarked for greening homes is being reduced from the £2.5bn announced with fanfare last summer. Of that, £1bn was earmarked last year for local authorities to improve homes for people on low incomes, now raised to £1.3bn. But the green homes grant was meant to disburse an additional £1.5bn, most of which remains unspent.
Scrapping the green homes grants leaves the 20m households on moderate incomes without any government help to undertake the improvements necessary to reduce greenhouse gas emissions.
Heating the UK’s draughty homes makes up about 14% of the country’s carbon emissions, according to the Committee on Climate Change, and successive efforts to tackle the problem have run into problems. The failure of the green homes grant follows the abandonment in 2015 of the previous scheme, the green deal loan scheme.
Kate Blagojevic, head of climate at Greenpeace UK, said: “We’re just seven months away from hosting a global climate conference at which we’re supposed to be leading the world on climate action. But we cannot expect anyone to think we’re a credible leader when our own policies on climate action are going in the wrong direction.”
The government on Saturday said the scheme was only ever intended to be a short-term stimulus. However, Matthew said that was part of the problem. “There has been a stop-start approach [to home energy efficiency] which has stopped businesses investing in skills, and has failed to give households confidence,” he said.
“They [the government] must pick themselves up and create a new green programme that works, and has long-term funding in place from the beginning. It is surely not beyond the capability of this government to give money away at a time of economic crisis.”