Minimum Energy Efficiency Standards: Cost Caps for Landlords

Baroness Thornhill Excerpts

Monday 15th September 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I understand the points the noble Baroness is making. That is one of the reasons why we consulted on two different levels. The consultation for the implementation of MEES would require social homes to have energy performance certificates at rating C or equivalent by 2030. There is currently no minimum energy efficiency standard in the social rented sector. Some 72% of social rented homes are already at EPC bands A to C. More than 600,000 social homes are in fuel poverty, so improving the energy efficiency of social homes will help reduce energy bills and tackle fuel poverty. This is important. Having gone through the debate on Awaab’s law the other day, I know it is vital that social homes are brought up to the standards we all want to see.

[Baroness Thornhill (LD)]

My Lords—

[Lord Young of Cookham (Con)]

My Lords—

[Baroness Thornhill (LD)]

I defer to the noble Lord.

[Lord Young of Cookham (Con)]

That is very generous of the noble Baroness. Further to the Question asked by the noble Lord, Lord Carrington, has the Minister seen a survey by the National Residential Landlords Association indicating that 31% of private landlords are planning to leave the market in the near future, aggravating the existing shortage? What steps is the Minister taking to encourage long-term institutional investment by institutions—insurance companies and pension funds—to remedy this shortage?

[Baroness Taylor of Stevenage (Lab)]

The Government value the contribution made by responsible landlords and believe that they must enjoy robust grounds for possession and so on, but there is good reason for them to think about these reforms. They have nothing to fear from our reforms. The sector has doubled in size since the early 2000s. There is no evidence of exodus since reform has been put on the table. Our proposals make sure that landlords have the confidence and support that they need to continue to invest and operate in the sector. However, we are determined to level the playing field between landlords and private tenants by providing the latter with greater security. The noble Lord mentioned institutional investment. There is already institutional investment taking place through our major banking organisations to support private landlords to do the work that they need to do. That goes alongside a range of government funding, which will help with the differences that we all want to see.

[Baroness Thornhill (LD)]

Thanks to my generosity, the noble Lord, Lord Young, has covered half of my question, so I will make a quick switch. The minimum energy efficiency standards consultation made no mention of heat networks, which are mainly used by the social housing sector. Many are inefficient, old and very expensive to upgrade. What assessment has been made of the impact of these proposals on the viability of heat networks? As some are privately owned, how can this sector be responsible for improvements of networks that it does not own?

[Baroness Taylor of Stevenage (Lab)]

This is a very important question for those tenants who find themselves on heat networks. The noble Baroness is right to point to the fact that, while some of them have been maintained well and looked after, for others that is not so much so. We have allocated £1.29 billion of funding from the warm homes plan specifically to support energy efficiency improvements in social homes as part of wave 3 of the warm homes social housing fund. We are generally very much in favour of heat networks, and I hope that those organisations that operate heat networks will approach the department for that funding. The funding will deliver support to 144 projects across England. I hope that will provide some financial support for those organisations facing that dilemma.