Support for developing a business case for Local Authority/ Lendology - Able to Pay Retrofit Finance

The UK Government has declared its climate emergency and pledges to be carbon neutral by 2050.

Many Councils in the South West region have also declared climate emergencies but have set more ambitious targets, with many aiming to reach carbon neutrality by 2030.

The Able to Pay (ATP) retrofit market is of key significance in delivering the ambitions of the regions carbon reduction agenda as it is imperative that more focus is dedicated to the decarbonisation of heat through the retrofit of the UK housing stock.

Currently our homes use 35% of all the energy in the UK and emit 20% of the carbon dioxide emissions, and 19% of Devon's total emissions.

If the UK Government and Devon are to deliver their targets of a 68% emissions reduction by 2030, and net zero by 2050, household emissions need to be addressed.

To reduce the emissions from heat there is a need to drastically increase heating from renewable resources and to reduce the heat losses from buildings once this heat has been delivered.

To do this a large % of house types have to be more thermally secure than at present to allow for the efficient use of heat pumps (HP) in the heating of these properties.

Regen have publicly stated that 190,000 heat pumps are required to be installed in the HoSW by 2030 alone.

Of key significance in the overall deliverability of a successful ATP market is the ability of owner occupiers to have access to finance vehicles to carry out measures on their homes.

This project proposes assesses the establishment of a significant regional fund for this purpose managed by Lendology with the support of the regions Local Authorities.

After numerous meetings with Lendology and LA partners, as well as experts within the field of energy efficiency funding (including Bankers without Boundaries, Amber Infrastructure Group, Steve Fawkes: EnergyPro Ltd) this project has now reached a point that it requires independent appraisal.

SW Energy Hub's key initial suggestions, that should form part of this appraisal's scope, are that the Lendology and similar business models need: • Smaller less ambitious fund (£10 million rather than £100 Million +) • Will require significant financial contribution from the public sector to attract the required private investment • That from initial engagement with the public sector that they require a more substantive business case to make the appropriate decision on the willingness or ability to fund The project needs to research and study the most appropriate business model to offer a range of financial products to the regions potential ATP market.