Royal Commission on Environmental Pollution

The Royal Commission on Environmental Pollution has asked the Government to ensure that every home sold in Britain has an 'energy label' attached to it, giving purchasers information about its energy efficiency and likely heating bills. This move could make an important contribution to reducing the climate-changing greenhouse gas emissions from households.

The Commission's Chairman, Sir Tom Blundell, has written to Housing Minister Nick Raynsford asking for clear and simple energy information to be included in the seller's packs which the government intends to make mandatory for anyone putting their home on the market. These packs will cover much of the information which, currently, a prospective purchaser has to pay a surveyor or valuer to gather.

The Commission's view is that initially the pack should tell prospective purchasers things like how much double glazing the property had, the depth of loft insulation and the type of central heating system. This information should be organised into one comprehensive section on energy efficiency.

But eventually the seller's pack for every home put up for sale should include the results of a full energy efficiency survey. These surveys give the house a SAP (Standard Assessment Procedure) rating between 1 - extremely inefficient - and 100 (highly efficient and environmentally friendly). They also give provide a firm basis on which to estimate likely fuel bills and individually tailored advice on the most cost effective energy saving investments. SAP surveys are already carried out on new housing in order to comply with the Building Regulations.

The Commission believes the extra cost of a SAP survey to the seller would be minimal because it could be carried out by a surveyor gathering the other information which will be needed for the seller's pack. It has asked the government to work with the RICS, the ISVA and energy efficiency consultants to determine what the costs of a combined energy and fabric survey would be.

A copy of the Chairman's letter to the Minister is attached.

In October the government announced that it intended to proceed with its plans to compel would-be house sellers to prepare a package of information concerning their homes (DETR News Release 940, 11 October 1999). One of the most important items in this pack will be a house condition report based on a professional survey of the property. This announcement followed publication of a Government consultation paper on home buying (DETR, DTI and The Lord Chancellor's Department, 1998, The key to easier home buying and selling).

The sale of a house or flat presents one of the best opportunities for improving its energy efficiency and reducing the property's energy demand. Provided the property is not brand new, the purchasers are likely to want to make some changes and energy efficiency improvements could be integrated with these. Most buyers, furthermore, are borrowing large sums of money at relatively low interest rates to finance their purchase and they often borrow a little extra to cover home improvements. These could include energy efficiency improvements.

The Commission is preparing a major report on energy and the environment, much of which will be devoted to the threat of climate change and what means should be taken to counter it.

The Royal Commission on Environmental Pollution is an independent standing body established in 1970 to advise the Queen, government, Parliament and the public. It reviews and anticipates trends and developments in environmental policies, identifying fields where insufficient attention is being given to dangers and problems. The Royal Commission has chosen to interpret pollution broadly and approaches environmental issues within the framework of sustainable development, taking economic, ethical and social aspects of an issue into account as well as the scientific and technological ones. Its advice is mainly in the form of reports which are the outcome of major studies; 21 have been published since its formation.

The Commission has 14 members and is chaired by Sir Tom Blundell FRS, Head of the Department of Biochemistry at the University of Cambridge. It has a small, full time secretariat.

Enquiries: Nick Schoon, Secretariat. Tel: 020 7273 6635

Mr Nick Raynsford
Minister for Housing
Department of the Environment, Transport and the Regions
Eland House
Bressenden Place
London SWIE 5DU

25 November 1999

You announced on October 11 that the Government intends to proceed with the introduction of seller's information packs in order to make the process of home buying and selling faster, more transparent and consumer-friendly.

The Royal Commission on Environmental Pollution sees the introduction of these packs as a unique opportunity to stimulate interest amongst householders in the energy efficiency of housing. In the New Year the Commission will publish a major report on energy and the environment. This will emphasis that if the threat of climate change is to be countered, the UK is likely to have to make substantial improvements in energy efficiency in all sectors including the household sector, going even beyond what is required to fulfil the government's manifesto commitment of reducing carbon dioxide emissions by 20 per cent by 2010. This will be a long-term task and it is therefore essential to start now.

The government's consultative document, The key to easier home buying and selling, raised the possibility of energy efficiency information being included in the seller's survey of the property for sale (paragraph 63). It characterised the benefit of this as 'promoting better and more energy efficient upkeep of the nation's housing stock' (paragraph 67). We believe that benefit would be very significant and we are concerned therefore that information on energy efficiency should be an intrinsic feature of the pack.

To avoid the risk of making the obligation on sellers unduly onerous, we suggest that the government might proceed in the following way. Initially, the seller's survey report would simply have to describe the main energy saving characteristics of the dwelling. It would tell prospective purchasers how much double glazing the property had, the depth of insulation in its loft, its type of central heating system whether it had cavity walls and whether these had been filled with insulation, and so forth. Surveys already cover much of this information; the sellers' pack could, however, improve on the situation by organising it into one comprehensive section on energy efficiency. To maximise the impact of this aspect of the sellers' pack, it could be complemented by publicity and advice campaigns on home energy efficiency and climate change targeted at purchasers.

In the long term, we believe there is a strong argument for using the requirement for a seller's pack to ensure that every home has a SAP energy efficiency survey at the point of sale. Such a survey gives the purchaser a full picture of the energy efficiency of a property and a basis on which to estimate her or his likely fuel bills as well as providing individually tailored advice on the most cost effective energy saving investments. On its own, a SAP survey costs at present almost as much as an RICS/ISVA Homebuyer Survey. But if both surveys were combined in a single visit the cost would be greatly reduced because there is considerable overlap in the work involved. The surveyor would require some training in SAP and use of a personal or laptop computer loaded with the appropriate software. While it would therefore be premature to introduce a requirement for a SAP energy efficiency survey immediately, we would ask the government to work with the RICS, the ISVA and energy efficiency consultants to determine what the costs of a combined SAP and Homebuyer survey would be if carried out in a single visit. The legislation which introduces the reforms to house buying and selling should be flexible enough to allow SAP surveys to become mandatory at a future date.

We believe the introduction of seller's packs is an excellent opportunity to improve the home buying and selling process and at the same time demonstrate how the government's commitment to tackling climate change is informing its other policies.

I am copying this letter to the Deputy Prime Minister and the Minister for the Environment.

TOM BLUNDELL

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