Green home improvements can create £3.5bn market for builders

The building industry could tap into a new market worth between £3.5bn and £6.5bn per year if the UK developed policies, skills, and financial incentives to upgrade housing stock to make it greener and more energy efficient.

These are the conclusions of new research, Building A Greener Britain – Transforming Britain’s Housing Stock, commissioned by the Federation of Master Builders (FMB), from the Environmental Change Institute at Oxford University.

"Making low-carbon housing mainstream will be good for business and good for jobs, as well as reducing energy bills and CO2 emissions," said Gavin Killip, author of the report.

"UK housing is among the worst in Europe when it comes to energy efficiency, which means there is plenty of room for improvement. Bringing British homes up to standard is possible using existing technology but the skills and industry base to deliver the necessary change is under-developed."

The report recommends a new government housing policy to demonstrate its commitment to low-carbon refurbishment of homes so that manufacturers and suppliers can invest with confidence in the development of the necessary supply chains.

It also calls for a cut in VAT on housing refurbishment from 17.5 per cent to five per cent, council tax rebates to promote energy efficiency, and a review of energy performance certificates to improve accuracy and reliability.

"What is particularly encouraging for builders is that at a time when the building sector is suffering a downturn as a result of the credit crunch, there is a potential new market of several billion pounds every year,’" said Richard Diment, director general of the FMB.