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The Merton Rule - is it the last hope for the UK renewables sector? |
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3 Aug 2015, 7:15 PM
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The Merton Rule may be the only mechanism left in place that could be used to help offset the onslaught of backtracking policies currently being rained down on the green building movement by the present UK government. The Merton Rule is so named after the Local Authority that in 2003 adopted the first prescriptive planning policy in the UK that required new commercial buildings over 1,000 square meters to generate at least 10% of their energy needs using on site equipment powered by renewable energy (sun, wind or water).
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The construction industry is reeling after a spate of government announcements that cut a swathe through sustainability policy which has been painstakingly developed and adopted over the last two decades.
Under David Cameron the present UK government has all but completely scrapped its 2016 zero carbon homes policy by abolishing the allowable carbon offsets solutions scheme and a proposed 2016 increase in on-site energy efficiency standards. The government also scrapped a related zero carbon buildings policy that would have applied to all new non-residential buildings such as offices, schools and hospitals from 2019.
One of the hardest hit sectors is the fledgling renewables industry: 'With the recent announcement that 'Zero Carbon Homes' will be halted it is essential that more Local Authorities see the opportunity solar PV can bring to their communities and use ‘Merton Rule’ policies to drive deployment in their region'. said The Renewables Energy Association (REA). 'Over the next few months, the REA will be campaigning to raise the profile of the Merton rule and to ensure it is rolled out more widely.'
But is the Merton Rule robust enough to be become a suitable 'stand-in' for the lamented 'Zero Carbon Homes' legislation? Well certainly the rule enjoyed early adoption right across England and it impressed the Mayor of London and many other councils who quickly embraced it and it soon become part of national planning guidance so the near future looked rather rosy for the REA and the sector - especially with the introduction of the Feed in Tariff (FITs) scheme which came along soon after.
Over the following few years, Merton council worked closely with other authorities, professions and industry to embed the Rule into the UK mainstream. This work not only led to significant CO2 reductions in new buildings where previously there would have been none, but it also helped to support and encourage confidence in the new technologies.
In 2008, the UK government published its central planning guidance Planning Policy Statement - Planning and Climate Change - PPS1 that requires all UK local planning authorities to adopt a "Merton rule" policy - receiving Royal Assent in November 2008. The Planning and Energy Act 2008 enables all councils in England and Wales to adopt a Merton Rule as well as specify energy efficiency standards over and above that of building regulations but in the recessionary climate that soon followed have we actually seen much evidence to support a robust rollout of the rule?
Certainly at the time, the radical policy triggered much debate amongst property developers, energy companies, and practitioners. The policy attracted plenty of criticism too for 'assuming' that renewable energy generation represents the most effective method of reducing CO2 emissions at any given location and on any given building. However, the policy (if not always the technology) did work well on both fronts, as an incentive for architects and engineers to begin designing more energy efficient buildings - with the core rationale that the more energy efficient the building the less renewable energy is required to meet a percentage target.
However, regardless of the potential win-win situation, developers were rather disquiet because the onsite renewable energy generation equipment increased capital costs and required more on-site skills. Supporters of the Merton Rule (and similar policies) argued that the revenue benefit accrues to the subsequent owner/occupiers in the form of reduced energy bills and increased equity - and as such the buildings carry a retail premium. The advent of the UK Government's FiTs later in the decade, also helped significantly reduce the payback time of photovoltaic, and wind/hydro turbine renewable energy capital costs.
But now the Conservative government who are 'buoyant' about winning a second term in office seem over-keen on policy reversal, but one has to wonder on what logic are they acting? Major sectors of the construction industry had geared up to tackle 'climate change' and this was out of the blue because for the whole of the last Parliament there was little talk of 'scrapping' carbon reduction policy.
The public seem in no mood for abandoning climate mitigation measures either. Survey after survey conclude that the environment remains high on most peoples agenda even though wages are under pressure and costs are rising. However, regardless of all this and with little or no consultation the government are wading through green policies with a big stick - and flying in the face of solid research and data that identify that carbon reduction strategies such as 'Code for Sustainable Homes' and 'The Green Deal' were beginning to show significant progress in reducing the carbon footprint of the built environment, even though so much remains to be achieved.
The UK Green Building Council chief executive Julie Hirigoyen said. “This U-turn not only means our new buildings will be less energy efficient and more costly to run, but it comes at a time when the UK should be taking strong action on climate change ahead of the UN conference in Paris in December. We urge government to reconsider its position for the sake of future confidence in the UK’s low carbon economy.”
In fact so odd is this government u-tun that many of The UK’s influential property and development industry leaders including Lend Lease Europe have urged the UK government to reconsider its decision to scrap the Zero Carbon Homes policy that has been in place since 2006. More than 200 influential company leaders have now signed an open letter asking the government to reconsider their decision.
The government seem to have their head in the sand on this though with Amber Rudd parading around claiming they are the greenest government yet with a determination to cut carbon emissions!
In response to this, Head of External Affairs, at REA, James Court said- “If the government really are determined to cut emissions in the most cost effective way, technologies such as solar, biomass and onshore wind are the cheapest technologies to do this, yet are also the technologies most often getting attacked” “Solar is the closest to grid parity, and we need to ensure it has a smooth transition to post-subsidy, not a cliff edge that threatens the industry, the cost reductions and investor confidence.”
For instance, a recent report on solar by KPMG, still identifies the need to mandate solar PV on new build properties. The latest data from DECC also highlights the importance of this, with still only 2.3% of UK households having had solar PV installed and therefore benefiting from lower energy bills.
The best performing local authority (from a renewables perspective) for domestic solar in the UK is mid-Devon, but even this authority has only 10% of households with solar PV installed. In terms of actual installations Cornwall is well in the lead with nearly 13,000 domestic solar installations, however out of the 245,798 households in the region this still accounts for just 5.3%. London is falling well below the national average, with over 3 million households and just 15,677 domestic solar installations, less than 1% of households have solar installed.
Credits:: Image by Gavin Harper.
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