‘More ambitious’ housing retrofit programme could create 138,000 jobs over next 10 years, says Greenpeace

Doug Parr, UK policy director at Greenpeace, said “a more ambitious plan” from the government “could create many thousands of new jobs right across the country and pump billions into the economy”.

“This should be music to the prime minister and chancellor’s ears,” he added.

The environmental campaign group is calling on the government to commit an extra £12bn towards retrofitting homes in the upcoming Spending Review.

Ministers must also deliver a “comprehensive package of grants, loans and tax incentives” in its long-awaited Heat and Buildings Strategy, the organisation said.

The report considered a third scenario, which had the cost of heat pump installations rapidly falling to £5,500 in line with industry estimates.

This scenario would boost the economy by £5bn, but would only create 83,400 jobs by 2030.

All scenarios included the assumption that the government will provide £4,000 grants for households to install heat pumps over the first three years, with grants then falling over time to ensure the cost of installing a heat pump matched that of replacing a gas boiler.

They also included the assumption that the government will cover 45% of energy efficiency improvement costs.

Alternative funding models were also considered as part of the report, including a scenario in which the government provides no extra investment, leaving households to pay the full cost of upgrades.

This scenario would mean GDP increased by just £200m by 2030, with just 34,700 jobs being created.

Jon Stenning, associate director at Cambridge Econometrics, said: “This analysis highlights the substantial economic benefits that would result from a programme to encourage the deployment of heat pumps and energy efficiency measures into people’s homes. The government should take the opportunity presented by the Comprehensive Spending Review to set out a clear long-term framework for delivering these measures, which are an essential component in decarbonising the UK economy.”

A government spokesperson said: “The UK has a strong track record in improving the energy performance of its homes, with 40% now above Energy Performance (EPC) Band C, up from just 9% in 2008.

“We are committed to going further and faster, which is why we’re continuing to invest £9 billion in improving the energy efficiency of our buildings, including £1.3 billion this year alone to upgrade an additional 50,000 homes, while supporting hundreds of thousands of skilled green jobs.”