Levelling-up and Regeneration Bill

Lord Best Excerpts

Committee stage
Monday 27th March 2023 Lords Chamber

[Lord Ravensdale (CB)]

My Lords, I shall speak to my Amendment 484. I thank my supporters: the noble Lords, Lord Best and Lord Stunell, and the noble Baroness, Lady Hayman. I also declare my interests as a director of Peers for the Planet, and as a project director working for Atkins.

It would be helpful if I started with some definitions; I hope I am not teaching too many noble Lords to suck eggs. There are two types of emissions from buildings: operational carbon, which is those emissions due to energy and water use; and embodied carbon, which is those emissions related to construction materials. Operational carbon emissions are already limited by Part L of the Building Regulations, but there is no such parallel regulation limiting embodied carbon emissions.

For a long time, operational carbon emissions have accounted for the majority of buildings’ emissions. However, with decarbonisation of the grid, operational carbon has reduced in recent years and that trend is set to continue, particularly with the introduction of electric heating. As such, the embodied carbon emissions in construction contribute an increasing proportion of the whole-life carbon emissions for most buildings, with one study indicating that over two-thirds of a low-energy new building’s emissions are embodied.

UK embodied carbon emissions represent some 50 million tonnes of emissions per year, which is more than aviation and shipping combined—a huge quantity of emissions that is completely unregulated and has increased in recent years. We think of the huge effort that is going into mitigating the carbon emissions of aviation and shipping: we have a sustainable aviation fuels plan, jet zero and plans for corridors for emission-free shipping based on ammonia and hydrogen. But for embodied carbon the current plans in place are sparse—although industry is making some good progress in reporting—so we have a problem.

Lord Boyce, who sat on these Benches but passed away, sadly, late last year, had a saying which went something like, “There is no such thing as problems, only solutions in disguise”. The solution here is a fantastic campaign, which has been under way for a number of years, to add a new part, Part Z, to the building regulations; this would start with reporting and then move on to regulation of embodied carbon emissions. It has wide support across industry; 200 of the country’s leading developers, clients, contractors, architects, engineers and institutions have written statements of support. These include organisations such as British Land, Willmott Dixon, Sir Robert McAlpine and Laing O’Rourke—I could go on—and industry bodies such as the Construction Industry Council, the Concrete Centre and the Steel Construction Institute; so there is wide support right across industry.

Industry already has the tools necessary to respond to Amendment 484 and, indeed, is voluntarily using them. Regulation would simply unlock the final door to enable the existing mechanisms to run smoothly and to ensure a level playing field. It has already been the subject of a Private Member’s Bill put forward by Jerome Mayhew in another place, which has enjoyed wide cross-party support.

Many countries in Europe are already proceeding with the approach outlined in the amendment. These include France, Sweden, the Netherlands, Finland, Denmark and Norway. It is not only about the emissions cost; we risk being left behind in the opportunities that the amendment will unlock if we do not proceed with it soon. These opportunities include the benefits of a standardised approach to reporting—rather than the patchwork quilt of the many approaches that exist currently—which would reduce overall costs to industry, and the treasure trove of data that would be generated and could then be used to inform further decarbonisation efforts, both in voluntary targets and in leading towards eventual regulation.

To add to this, the policy signal provided by this amendment would mean that the UK could then develop in growing markets such as steel recycling, an important area that could be developed in the UK. Rather than exporting scrap and importing recycled steel as we currently do, we could invest in that industry in the UK, as is currently done in the US and Europe. Low-carbon cement is another example; if the signal were given, attracting investment and moving that from lab scale to implementation would be much more of a priority—likewise, low-carbon building materials such as non-plastic insulation and the retrofit and reuse market.

So what is currently going on within government? The Government’s construction playbook calls for carbon assessments on all public projects. However, it provides no details as to how that should take place or what an appropriate carbon emissions level is. This leads to many inefficiencies in differing approaches to assessments, increasing overall costs to the taxpayer.

The key ongoing activity is a DHLUC consultation on embodied carbon reporting, which is due to report later this year. Our amendment has been drafted to align with that consultation; it states that regulations must be made within six months of the Act being passed. This amendment would give the Government a ready-made legislative vehicle to implement these regulations once the outputs of the consultation have been defined. All the pieces of the puzzle would then be in place; otherwise, I fear that we would have much longer to wait to make parliamentary time available—we need to move quickly and seize the opportunity here.

Working in business myself, one area of concern that I am very conscious of is to avoid placing additional burdens upon small and medium-sized enterprises. Whole-life carbon assessments will involve some additional costs to businesses, at least initially while tools and approaches are being refined. This is why we have placed limits within the amendment; it applies only to building works with a total useful floor area of 1,000 square metres or over and to developments with more than 10 dwellings. This shields smaller developers from the initial costs of undertaking whole-life carbon assessments.

Finally, I will go into a little more detail on how the amendment would work. The overall strategy is to “report first, limit later”. This follows the precedents set elsewhere in Europe and makes the transition towards zero-carbon construction easier, while sending a clear signal that legislated limits are coming. The amendment deals with the initial reporting aspect, with the intent that later regulations would cover embodied carbon limits, which would in themselves be informed by the initial reporting phase. As I alluded to earlier, approaches to many of the aspects in the amendment have already been developed and are being used voluntarily by industry; for example, the Royal Institution of Chartered Surveyors has defined a methodology for calculating embodied carbon.

The emissions footprint that embodied carbon represents means that we need to move forward with urgency and help to enable industry to bring forward solutions. The Levelling-up and Regeneration Bill is an ideal and timely enabler to make this happen.

[Lord Best (CB)]

My Lords, I rise to support Amendment 484 in the name of my noble friend Lord Ravensdale, which was so comprehensively and expertly laid out before us. I declare my interests as president of the Sustainable Energy Association and a member of the Peers for the Planet coalition.

This amendment would require housebuilders and other developers to produce an assessment of the amount of carbon for which the construction of a proposed project would be responsible over its life. This includes the carbon embodied in the building materials used and the construction processes deployed.

Everyone recognises the necessity of building in ways that limit carbon emissions once the building is constructed, but that is only half the story. Half of total emissions—possibly more—associated with new building come from the carbon embodied in its construction. Concrete, steel and other materials use vast quantities of fossil fuels, as does transportation, sometimes across continents, of heavy building materials.

The House of Commons Environmental Audit Committee has shown that—as the noble Lord, Lord Ravensdale, said—the embodied carbon in new buildings accounts for more emissions than aviation and shipping put together; that is a great statistic. Yet this huge contributor to climate change is virtually invisible. Measuring and assessing embodied carbon alongside the subsequent emissions over a building’s lifespan should make all parties think harder when choosing building materials. There are many alternatives to the worst-offending components. This amendment will provide the basis for eliciting the evidence for more sophisticated decision-making.

The amendment could also lead to greater priority being given to making the best use of the buildings we already have before demolishing and replacing existing structures and adding to landfill. Demolition and construction also create dust and air pollution on a massive scale, amounting to some 30% of harmful particulates in urban areas. Retaining—rather than clearing and replacing—existing housing can also have social and community benefits. Demolition of Victorian terraced streets in the 1960s and 1970s is now seen to have been, in many cases, an unfortunate mistake. The amendment forces us to pay more attention in the wider levelling-up agenda to the regeneration of the homes we have today, rather than concentrating, as the Bill does, on the planning and delivery of new homes.

Action to upgrade existing properties—with green grants, regulations on energy efficiency for lettings, tax incentives and more—does not only address the decarbonisation challenge, it improves quality of life, reduces fuel poverty and saves NHS budgets. Recent research by the Building Research Establishment found that excessively cold homes, for example, are costing the NHS £540 million a year. The improvement of existing housing would also be accelerated, and the stock of available affordable homes increased, by the introduction of a national housing conversion fund to finance acquisition and modernisation of poor-quality, privately rented properties.

As the levelling-up programme moves onward, these regeneration measures will demand more of government’s attention. In the meantime, this amendment would achieve a more credible basis for judging the environmental impact of building practices and I strongly support it and the creation of a new Part Z to the building regulations.