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The journey to green social housing is long

The priorities identified during COP26 last year are not new, but the conference served to increase the pressure to make progress. For social housing, that includes addressing sustainability.

14 January 2022

Dan Pardesi, Inenco’s Head of Social Housing, recently sat down with Inside Housing to discuss the outcomes from last year’s COP26 meeting, and more broadly how social housing organisations are progressing towards net zero.

How has COP26 changed what’s expected of social housing organisations on environmental sustainability, and on carbon emissions specifically?

Decarbonisation, energy efficiency and cost efficiency have always been important to the sector. We’ve always had challenging targets around improving energy performance and an expectation that social housing organisations were going to take a lead in the domestic decarbonisation of the UK.

What has changed is the focus on environmental sustainability. COP26 received enormous coverage and emphasised the scale of the climate emergency. The government announcing the Social Housing Decarbonisation Fund and funding for heat networks is really positive. But there’s also pressure on organisations to demonstrate to their customers and stakeholders that they are organisationally sustainable.

There’s quite a degree of polarisation in the social housing sector. Some organisations have made great strides in reducing their carbon emissions and increasing their sustainability. Some have acknowledged that decarbonisation of their stock and decarbonisation of their own operations will happen on different timelines and have looked to set net-zero targets with different dates for those two elements.

From where should social landlords expect pressure to increase their own sustainability?

With environmental and social governance [ESG] becoming more and more important from a funding perspective, social landlords are going to have to begin to measure and manage their sustainability impact in a more defined and reportable way to gain investment.

We’ve seen larger housing associations being successful in achieving significant investment from things like green bonds and that’s going to continue. There’s going to be a lot of pressure from banks, funds and investors to make sure any investments they make into social housing provide the right level of ESG credentials.

There’s also going to be the need to demonstrate sustainability to tenants. COP26 has shown us how important sustainability is to the younger demographic in particular. Organisations are going to see demand from customers for energy-efficient homes that are fit for the future. Ultimately, if one social landlord has a very good sustainability record, they’re likely to be more attractive to prospective customers than another social housing organisation that’s not as advanced in the sustainability and carbon-reduction field.

From a government perspective, there’s going to be pressure for the social housing sector to take a lead in domestic energy efficiency and carbon reduction, and rightly so. We’re already seeing organisations like the Regulator of Social Housing and the National Housing Federation starting to champion this area.

What’s your sense of how landlords are evaluating their carbon footprints? How can they do so more effectively?

Some organisations are further ahead than others. If we look at the larger housing associations, they’ve already been reporting carbon emissions for a number of years. The particular challenge around this is always what you report and from where you can get accurate data.

At the moment, organisations tend to report on their scope-one emissions – direct emissions from things like burning gas to provide heating that’s recharged to tenants and residents – and on scope-two emissions, which are indirect emissions from things like transport for maintenance fleets.

I think we’ll see more and more people adopt the streamlined energy and carbon reporting guidance. This is widely used in the private sector by large businesses, and it involves looking not only at an organisation’s direct and indirect emissions but also up and down the value chain at what’s known as scope-three emissions – missions from suppliers and from end-users as well.

Social housing organisations should start with reporting emissions where the data is available and where improvement is within their control. Generally, that will be around scope one and scope two.

What actions can landlords take that will give the biggest ‘bang for their buck’ on reducing carbon emissions and increasing sustainability?

Organisations should start with making sure they’ve got the right data and systems in place to be able to report and manage their scope one and scope two emissions. Systems should be set up for them to be able to review their use of electricity, gas, transport fuel and so on.

Once that data is available, it’s often possible to find the low-hanging fruit – the relatively quick and simple improvements that can be made to drive efficiency and reduce carbon emissions.

How can social landlords best develop a longer-term plan which gets to net-zero but also accelerates progress in the short term?

You really need to have an aligned organisational strategy that considers all the drivers for change – not just the environmental ones, but those linked to the success of the organisation, identifying the risks and opportunities.

That strategy needs to focus on people, processes and technologies. Within people, I’d be thinking about how we make sure everybody’s engaged with carbon reduction. How do we give people the right tools for their job? That might be driver training, which might be engaging heating engineers to make sure that what they do drives efficiency in all aspects of their work.

With processes, that’s looking at the energy efficiency of any building over which you have control – so depots, offices and the like. That might involve looking at energy management systems.

Then you can look at technology upgrades. There’s a lot of focus, particularly at the moment, around the rise in the use of heat pumps and the phasing-out of gas boilers. That’s certainly something which is going to be a significant part of the next 20 or 30 years. However, there are also other aspects which are going to be important – things like the rise of electric vehicles.

How can landlords best communicate with tenants about the actions being taken?

What we’re seeing is that more and more people actually are engaged with carbon reduction. More and more people take note of organisations’ emissions and emissions-reduction programmes in considering the organisations that they choose to do business with.

Social housing providers shouldn’t shy away from reporting on the work they’ve done to reduce carbon emissions relating to their organisations. Explaining what a carbon reduction is equivalent to – “one flight from here to New York” or “driving around the world five times” or whatever it may be – does help people visualise the impact of a project.

But, I think that, particularly following COP26, what people are really going to want to see is progress to that net-zero target – how close you’re getting, how much progress you’ve made in terms of percentages and what you’re going to do about it next – because this is not going to be a short journey.

By partnering with Inenco, you will have the expertise on hand to help define, develop and deliver an environmental sustainability strategy that is aligned with your overall corporate objectives – giving you access to the funding that will help secure your organisation’s future.

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