Will the government abandon its commitment to sustainable policies or grasp a golden opportunity?

Julie Hirigoyen

Do the Tories fully appreciate the economic potential of “greener” buildings? It’s a question many business leaders from the construction and property industry will have asked themselves upon waking, bleary-eyed, on the morning of 8 May, to discover that the Conservatives had swept to an unexpected victory in the general election.

Because let’s be honest, the Conservative party often attracted the ire of “sustainability advocates”, whereas their former coalition partners, the Lib Dems, were praised for their progressive environmental and social rhetoric. So who would blame the green building industry for worrying that the Tories would abandon sustainable building policies to the scrap heap?

But in fact there have been some encouraging initial signs.

The once husky-hugging David Cameron has, in public at least, been a firm supporter of energy efficiency, arguing in 2013 that “the economies in Europe that will prosper, are those that are the greenest and the most energy efficient”. (Privately, he allegedly told aides to “cut the green crap” on energy bills.) Last month he praised the Green Investment Bank (GIB) for “leading the world” in the next generation of energy infrastructure. And indeed the GIB, which was created under his leadership, has invested in an impressive range of energy efficiency projects since launching in 2012. Even before the election, the Tories pledged to “cut emissions as cost-effectively as possible” in order to meet the UK’s climate change commitments. And life after the coalition could represent a golden opportunity for the Tory government to reclaim the green agenda, to ensure that conservatism and environmentalism can go hand in hand, and to capitalise on green not simply for the sake of the planet, but also for the future success of our economy. Cameron’s support of the G7’s climate change commitments would certainly suggest this is possible.

The green building industry’s initial fears may have been confirmed when the government announced it would be cutting the DECC’s budget by £70m, with £40m of savings coming from home energy efficiency

After returning to Number 10, Cameron quickly chose Amber Rudd to head the Department of Energy and Climate Change (DECC) in his first handful of ministerial appointments. Ms Rudd’s appointment is significant for a number of reasons. A junior minister at DECC in the final year of the coalition, she already has experience of the complex landscape that is UK energy policy and, as a close ally of George Osborne, can hopefully gain greater traction for green issues within the Treasury. What’s more, she’s already demonstrated she understands the economic case for greener buildings. After all, it was she who championed the Energy Savings Opportunity Scheme for businesses, she who described the ground-breaking Minimum Energy Efficiency Standards for privately rented buildings as “a real boost to the industry”, and she who is keen to create a “solar revolution”.

The appointment of Greg Clark as communities secretary, replacing the much-maligned Eric Pickles, himself intent on blocking many of the more sustainable building policies, is also welcome. Clark is a former secretary for energy and climate change, but also a strong advocate of city mayoral powers, planning reform and sustainable development, as well as being involved in many early discussions resulting in the Green Deal policy.

However, late last week, the green building industry’s initial fears may have been confirmed when the government announced it would be cutting the DECC’s budget by £70m, with £40m of savings coming from home energy efficiency. The fact that more than half of the DECC’s budget cut is to be made in this area is an ominous sign of the new government’s priorities, despite its emphasis on keeping household and business energy bills low, keeping the lights on, and keeping our emissions in check.

Actions like these make it difficult to remain optimistic about whether the Conservatives really do get this agenda, but I’m determined to think they do. Why? Because of the synergies that exist between greener building policies and the Tories’ own economic rhetoric. Energy efficiency in buildings offers a suite of economic benefits; stimulating growth and creating jobs, strengthening our international competitiveness, lowering energy bills and reducing the burden on the NHS.  

Business leaders from the construction and property industry already recognise these benefits, and not simply because they’re the right thing to do. They’ve adopted bold energy efficiency and carbon reduction targets in their own businesses because they generate real commercial value. This was recently demonstrated by a group of more than 55 business leaders who put their names to an open letter we coordinated to the Chancellor George Osborne. The letter highlighted the “major economic opportunity” offered by reducing carbon emissions from buildings, and demonstrated the “remarkable degree of consensus” which exists on this issue among industry leaders.

The Tories have something of a dilemma. They are insistent on driving forward austerity measures, such as spending cuts at the DECC and other departments, but in doing so deny the economic opportunities that that funding presents. If they decide to continue on that path and choose not to hear that collective corporate voice that suggests otherwise, surely they are ignoring the pro-business mantra that lies at the heart of the party? Let’s hope last week’s cuts were just a momentary glitch for a new government which does appreciate the business case behind greener buildings. 

Julie Hirigoyen is chief executive of the UK Green Building Council