Financing energy efficient buildings: the path to retrofit at scale

Financing energy efficient buildings: the path to retrofit at scale

“The work carried out by the Coalition for the Energy Efficiency of Buildings represents a positive step towards achieving our Green Finance Strategy ambition to build the market for green home finance. The proposed demonstrators aim to support the development of innovative products to finance energy efficiency and build a vibrant market for energy retrofit. This will support the UK in delivering its commitment to move towards net zero whilst growing our economy.”

The Rt Hon Kwasi Kwarteng MP, Minister of State for Business, Energy and Clean Growth

Download the full report here: Financing energy efficient buildings the path to retrofit at scale

Foreword

Citizens, communities and economies are facing the two greatest challenges of our times: climate change and the Covid-19 pandemic. The response to both these crises is rooted in science and innovation, as we seek solutions to monitor, mitigate and adapt to the impacts of coronavirus and our changing climate. The role of our financial system is also increasingly recognised as essential in facilitating those solutions, while also helping to create a more inclusive and sustainable global economy.

In the UK, our built environment is responsible for almost 30% of total greenhouse gas emissions. And yet this sector has significant potential to decarbonise and unlock wider benefits across the economy: energy savings that increase consumer spending power, healthier homes that reduce the burden on our health system, and the creation of new skilled jobs that can help stimulate the UK’s economic recovery.

In December 2019, the Green Finance Institute established the Coalition for the Energy Efficiency of Buildings to stimulate action across the finance sector to support the decarbonisation of our homes. In line with the Institute’s theory of change – which focuses on creating opportunities for the financial sector to profitably support the transition towards an environmentally sustainable economy – the Coalition is developing the market for financing net-zero and resilient homes, through the co-design and launch of viable and impactful financial ‘demonstrators’ that provide the catalyst for further financial innovation at scale.

This report outlines the results from the Coalition’s first phase including a focused review of the domestic retrofit market, a portfolio of ‘demonstrators’ that were developed by the 52 member organisations to unlock the barriers to investment, and policy recommendations that establish a conducive environment for rapid adoption and scale-up of energy efficiency improvements.

The UK has shown global leadership in tackling climate change and developing the green finance market. The Coalition for the Energy Efficiency of Buildings builds on the important work of the Green Finance Taskforce and Green Finance Strategy. As the Coalition moves into its next phase, delivering the first portfolio of demonstrators to market as set out in this report, we aim to demonstrate that cross-sector collaboration, focused on practicable, financial solutions to deliver local real-economy impact, is a key component to achieving the systemic change needed to meet the global challenge of decarbonising our built environment. We welcome you to join our journey.


Dr Rhian-Mari Thomas OBE
Chief executive, Green Finance Institute
Chair, Coalition for the Energy Efficiency of Buildings

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