New research backed by CEW and delivered as part of the LENDERS REPORT argues that a change in the way mortgages are calculated might allow homebuyers to access more money, but also change attitudes towards energy performance.

Homebuyers have potential to borrow more with better, more accurate forecasting of energy bills, if the findings in research from the LENDERS project is applied.

That was the headline at the launch in Westminster on 18th July and this was echoed in a piece by the Guardian’s Adam Vaughan published on the same day.

There is more to the research and the findings than that.

The LENDERS report recommends a change in the way mortgages are calculated and could improve loans to homebuyers by up to £11,500. The project included the analysis of 40,000 sets of property data, and was undertaken by a consortium of partners: Arup, BRE, Constructing Excellence in Wales, the Energy Saving Trust, Nationwide Building Society, Principality Building Society, UCL Energy Institute and the UK Green Building Council.

The work was part-funded by Innovate UK and involving a consortium of industry experts, the LENDERS project set out to demonstrate that improved analysis of the likely household energy costs could improve mortgage affordability assessments and potentially allow mortgage borrowers to access a larger home loan. The project itself project builds on a concept from BRE in 2010 initially developed by CEW (Constructing Excellence in Wales) & BRE and parallel research from 2014 by UCL & UKGBC, all of which that suggested a link between a property's energy efficiency and actual fuel costs.

The research was taken forward – once funding via Innovate UK and support from Nationwide and Principality was secured – to see what incentives might encourage homebuyers to look closer at the energy performance of their homes. The legal requirement for the availability of EPC data at the point of sale means homebuyers can make judgements on the energy performance of their purchase, but are only likely to do so in any numbers if there are suitable incentives. The research seeks to provide one such incentive by providing a method to capture differences in likely fuel bills.

The project successfully demonstrated and modelled the link between energy efficiency and household fuel bills. As a result, the team could create a new consumer calculator www.epcmortgage.org.uk to demonstrate the cost benefits of fuel efficiency, enabling would-be buyers to see the benefits of energy efficiency homes.

In the longer term, if this more accurate view of expenditure was used in lender affordability calculations, it could be reflected by increased mortgage lending to those with the most efficient properties. The report also suggests that the same change in forecasting could release thousands of pounds for those undertaking energy refurbishments.

Andrew Sutton, Associate Director, BRE, said: “Our research indicates that low energy homes potentially enable homebuyers to borrow more than those buying poor performing homes. Put simply, energy efficiency brings smaller energy bills, which if captured when calculating mortgage affordability could allow buyers to take out a larger loan.”

Henry Jordan, Director of Mortgages at Nationwide Building Society said:

The UK Government is fully supportive of the project and Claire Perry, MP, Minster for Climate Change and Industry, attended the launch and said: 

“This government is committed to making home ownership affordable for all. More accurate estimates of household energy costs could improve lending practices, lead to new sources of finance and increase energy efficiency across the country. That's why government funded this project through Innovate UK and looks forward to seeing the industry take action in response.”

Some critics have argued that the change in mortgage calculation is going to create a big problem for those who own poor performing homes. The answer is no. The project suggests that the same change in the affordability calculation should enable lenders a mechanism to reflect that homeowners who wish to undertake energy performance improvements should get lower bills. This would then demonstrate an increased capacity to make repayments on additional secured borrowing that could release capital funds to help pay for the energy performance improvements, creating a virtuous circle. The project does acknowledge that lenders’ commercial product offerings will need to consider at what point loans should be paid and what evidence is appropriate.

The project hopes that offering those searching for a home the potential of more money if they buy a lower energy home will shift buying habits towards lower energy homes. In turn, lower energy homes could see faster sales turnarounds then potentially a modest price premium. These changes could likely influence those renovating or selling homes to consider how they can maximise their sales price, and the potential to source additional borrowing against such energy performance work provides them access to funds.

So, when will the change happen? Changing the underlying mortgage affordability calculation that underpins at least £127bn of lending in the UK each year is not likely happen overnight. However, the first step is to make the forecasting tool available to homebuyers as informal guidance initially, which the project has done through its website lenders are encouraged to follow suit, with more detailed assessment of how to adapt affordability calculation likely to come in the following few years.

The LENDERS report is the first step – albeit the route to this point has taken considerable effort by the team led by Andrew Sutton. The LENDERS team now needs to cajole and influence Government as well as the mortgage providers to make the assessment needed to drive the changes recommended. CEW needs to have similar conversations in Wales. The project will also, in time, come to have an impact on the wider changes needed to improve the whole process of designing, planning and building and then buying a home in the UK.

Watch this space.

We are publishing a letter from Sophie Howe, Future Generations Commissioner for Wales, in full, that asks the construction industry and specifically the public sector to respond to the call from Lesley Griffith AM Cabinet Secretary for Environment and Rural Affairs to become carbon neutral by 2030. Please read it and respond 

Dear colleague, 

As you will be aware, the Well-being of Future Generations Act requires you to use the five ways of working to maximise your contribution to the seven well-being goals - many which relate to climate change and low carbon. In Wales, we also have the Environment Act which places a duty on Welsh Government to develop carbon budgets for Wales with the aim of reducing our greenhouse gas emissions by at least 80% by 2050, to support the global ambition agreed in Paris in 2015. 

There are currently two Calls for Evidence on the topic of decarbonisation and carbon budgets which I wanted to draw your attention to: 

The first relates to the Cabinet Secretary for Environment and Rural Affairs recent announcement regarding their ambition for the Welsh Public Sector to be carbon neutral by 2030; Welsh Government is calling for views on how this can be achieved.

It recognises that although the public sector only accounts for a relatively small amount of Wales’ emissions you are uniquely placed to influence emissions far more widely in areas such as transport, energy, land use and procurement. A focus on reducing emissions will not only tackle issues such as air pollution providing benefits to health, but will also have a positive impact on the local economy by reducing energy costs and by creating investment opportunities for the low carbon economy.

It also recognises the work Natural Resources Wales (NRW) has undertaken through its Carbon Positive Project. Through calculating the organisation’s net carbon impact, it found that over 80% of their emissions were indirect (i.e. not due to energy use in its estate or its fleet) with 55% from the procurement of goods and services alone. As part of the Project, NRW has identified feasible options to reduce emissions and protect and enhance carbon stocks. For example, it found it could achieve up to 27% emissions saving from its vehicle fleet through adopting low emission transport options.

The aim of the Call for Evidence is to explore the most effective mechanisms for achieving this ambition and the appropriate strategic actions required, and I would urge you to consider and contribute before the deadline of 13th September: 

http://gov.wales/topics/environmentcountryside/climatechange/public-sector-decarbonisation/?lang=en 

The second Call for Evidence has been issued by the UK Committee on Climate Change (UKCCC) and will inform the advice they provide to Welsh Government on setting carbon budgets and interim targets for Wales. It asks questions about the pathway (trajectory) of emissions reduction Wales should take to meet the 2050 target (of at least 80% reduction) given that we are on track to miss the current target of 40% reduction by 2020. It also asks what role the Public Sector, and others, can play in delivering emissions reductions and what opportunities we must take a different approach given the Well-being of Future Generations Act. Again, I would advise you to consider this Call for Evidence and respond if you are able to, before their deadline of 11th September. 

https://www.theccc.org.uk/welsh-carbon-budget-call-for-evidence/ 

I will be hosting an event in November, in partnership with Welsh Government and Natural Resources Wales to: explore how the public service in Wales can involve people in collaborating and integrating their work, to take greater account of the long-term carbon implications of their activities, and help prevent the effects of climate change becoming even worse.

Yours sincerely,

Sophie Howe
Future Generations Commissioner for Wales

On 21^st September, there will be a Networking for Innovation Conference held at The Cardiff Marriott.  It is a collaboration between in Homes and Places and the Construction team in Economy Skills and Natural Resources.

The Welsh Government earlier this year signed two ground-breaking Pacts, with industry trade associations and the official bodies representing housing and councils in Wales, committing to work together to help boost the supply of market housing in Wales and to help deliver the Welsh Government’s 20,000 affordable housing target. This is reinforced by programmes such as The Wales Property Development Fund, The Innovative Housing Programme and legislation such as The Wellbeing of Future Generations Act.

Innovation, retrofit, sustainability and modern methods of construction are key to the 20,000 target, to support the reduction or elimination of fuel bills for residents in Wales. In addition, it will help to inform the Welsh Government about the type of homes it should support in the future.

We recognise across all sectors and throughout the supply chain there is an appetite to bring this innovation to Wales, and support our objectives. As a result, the Welsh Government is holding a networking event on 21st September, at The Cardiff Marriott from 10am – 3pm to promote the growth of these models, with the aim of bringing together the public and private sector to meet with suppliers offering innovative solutions and potential development partnerships.

Prior to the event an exhibitor and delegate manual will be provided to assist in understanding who will be attending to suit your objectives and to arrange appointments. Meeting spaces including private meeting rooms will be available on the day and for pre-booking.

Attendance at the event will be by pre-registration only, and limited to no more than 2 delegates per company / organisation. Could you please register against your preferred time slot.

10am – 12noon

11am – 1pm

12noon – 2pm

1pm – 3pm

Please note this page is for delegates only. If you have a product that is innovative and delivers the social, economic and environmental objectives and you are interested in exhibiting, please click here to request an application form.

The Cabinet Secretary for Environment and Rural Affairs has highlighted the positive economic impact felt by Wales’ households and businesses thanks to the Welsh Government’s flagship fuel poverty scheme.

Welsh Government Warm Homes Nest provides all householders in Wales with access to advice and support to help them reduce their energy bills. This includes a referral for eligible householders for a package of free home energy efficiency measures such as a new boiler, central heating system, loft or cavity wall insulation, or renewable technologies. 

In 2016/17, the Welsh Government provided £19.5m for Nest and a further £3.9m has been levered in through the GB-wide Energy Company Obligation.  The Nest Annual Report for 2016/17 reveals:

• Over 5,500 households received free energy efficiency measures. 
• Average energy bill savings for households who had measures installed are estimated at £410 per year. 
• 264 households benefited from new or additional benefits, with an average increase in household income of over £1,800 per household per year. This equates to a £482,500 potential increase in benefit take up this year.  
• 382 households benefited from a Warm Home Discount rebate worth £140 off their electricity bill; this represents a total saving on energy bills of over £53,400.
• 77 households benefited from receiving support from their water companies. HelpU and Water Direct. They are collectively estimated to make direct savings of £14,300. 

Since 2011, 190 opportunities have been created by Nest including jobs, apprenticeships and training. All installations have been carried out by Wales-based small and medium sized enterprises (SMEs). One company that has directly benefited from its involvement in Nest is QRL Radiator Group, based in Newport.  QRL have been supplying radiators to Nest since January 2011, all made from steel produced by TATA steel. Over 153,000 QRL radiators have been installed through Nest.
Speaking during a visit to QRL recently Lesley Griffiths said:

“This report shows Nest continues to contribute impressively to job creation and growth in Wales. Since the scheme started in 2011, all installations have been carried out by Wales-based enterprises and over 190 opportunities have been created in the process. We should rightly be proud of Nest’s impact, both economically and environmentally. There is, though, no room for complacency. Tackling fuel poverty in Wales remains a significant challenge. That is why I am investing over £104 million in Welsh Government Warm Homes schemes over the next four years to improve a further 25,000 homes. I am confident Nest will continue its success in 2017/18.  I look forward to seeing many more households who have been struggling to heat their homes benefit from the help the scheme provides.”

New competition-standard, state of the art facilities will be delivered by construction experts Pick Everard and built nearby to the University’s Pontypridd Campus in Rhydyfelin.

An internal full-size 4G playing surface - the only full-size pitch of its kind in Wales - will be a key feature of the University’s new facility, meeting the approved standards required for football and rugby. The Sports Park will also house a strength and conditioning laboratory with 12 stations, modern teaching facilities, offices, and an observation/viewing gallery overlooking pitches.

Pick Everard, which has an office in Cardiff, is delivering project and cost management services on the scheme.

Mike Petersen, Director at Pick Everard, said: “Delivering first class facilities in the higher education sector is key to nurturing tomorrow’s sports men and women. This project will provide first class facilities for users and enable the University to excel and lead in its field. We are delighted to be working with the University of South Wales and look forward to delivering this project.”

Work began on the new sports park in mid-2016. Pick Everard was appointed to the scheme through the Scape Project Management and Quantity Surveying framework, which has since been superseded by the Scape Built Environment Consultancy Services framework. During site investigations, extensive historic mine workings were discovered within the site at Rhydyfelin. 

Rob Cleaver, Regional Director at Pick Everard, added: “The discovery of historic mines did threaten to cause a major delay to the project due to the need for extensive investigations and significant additional groundworks to make it suitable for construction works to begin. We minimised delays to the project that this discovery presented by securing the site and distributing arising earthworks while designs for the new building were still being developed. By re-programming the works, we ensured teaching areas could be occupied in time for the new academic year. Our team in Wales and the South West has considerable experience and expertise in higher education, and combined with our recent appointments by Cardiff University, Swansea University, and the University of Worcester for work on their higher education estates, this project signals a growing momentum in the sector for the firm.”

Work on the new Sports Park is expected to complete in November 2017.

There has never been a more important time to ensure your pre-construction and bid team productivity is operating efficiently.

Philip Collard, a nationally renowned industry business improvement management consultant, and one of UKs top bid team mentors is inviting you to a free workshop & clinic to share his vision of the profound changes, challenges and opportunities facing contractors over the next 15 years. He will explore how these can be addressed in your own business.

This bespoke work winning workshop will review your entire approach to winning work, to identify what systems are working well and what are not. It will identify where there are opportunities to improve your process, approach and pre-construction team behaviours to secure significant efficiencies and improve overall bid productivity and win rates.

You will receive a personalised report which will reveal valuable insights for your business development, pre-qualification, bid management and tendering activities, to help you identify tangible time and cost saving improvements, as well as the impact these could have on your overall profitability.

Each workshop is 3 hours long,

These zero-cost events are available at 15 locations nationwide between July and November, places are very limited so please book early, via the following Eventbrite pages:

Save the date and mark the place: Cardiff - 4th October at 9:30am to 12.30pm

• Luton - 14th September at 9:30am
• Derby - 14th September at 3:00pm
• Sheffield - 15th September at 9:30am
• Leeds - 15th September at 2:30pm
• Liverpool - 21st September at 9:30am
• Manchester - 21st September at 2:30pm
• Birmingham - 22nd September at 10:30am
• Cardiff - 4th October at 9:30am
• Bristol - 4th October at 2:30pm
• Portsmouth - 10th October at 9:30am
• Brighton - 10th October at 2:30pm

If you are unable to make any of the dates, please pass this invite onto one of your senior colleagues or let us know other dates where we can have a web conference. You can contact Amy Hazlehurst in the myConsole team on ahazlehurst@myconsole.co.uk or 0330 365 0110 to arrange this, or ask any questions that you may have.

NHS Specialist Estate Services (SES) have been seeking to establish several frameworks for the 3^rd Generation NHS Capital Developments programme. 

All framework procurements are proceeding as planned, with the exception of that for the National Cost Adviser, which SES have had occasion to cease. 

The reason for this cancellation was due to only one (1) tender being returned, thereby rendering the framework unable meet the overall 3^rd Generation framework aspirations of choice, capacity, capability and competition. 

SES are currently reviewing other options to meet the NHS Wales requirements for this letting, and would therefore welcome your attendance at an informal discussion to explore reasons why this procurement only received one formal response, what aspects were sufficiently unattractive to the market to cause such a low level of response, and what SES need to address in order to rectify this situation. 

The meeting is scheduled for 12:30 pm at Companies House on Wednesday 23^rd August. Should you wish to attend, please forward confirmation of attendance and vehicle registration details to: joanne.munn@wales.nhs.uk