Energy Efficiency Standard for Social Housing (EESSH2) Consultation feedback and our response

Introduction

We have been monitoring and reporting on landlords’ progress with the first EESSH milestone since its introduction in 2014. Landlords were expected to reach the first EESSH milestone by 31 December 2020. 

From 10^th November 2020 to January 15^th 2021 we consulted on proposed new indicators to allow us to monitor, assess and report on landlords’ progress with the Scottish Government’s (SG’s) second EESSH milestone (EESSH2). You can read the consultation documents

Our consultation was supported by SG’s draft EESSH2 guidance which was developed with the EESSH Review Group and took into account the results of the consultation SG carried out between May and July 2018. SG will consider the guidance further following the results of this consultation, with the aim of publishing a final version in March 2021.

Consultation feedback and our response

We asked four questions, the first three asked about the proposed indicators and question four was an open question, asking respondents for any other comments or suggestions. Broader issues raised in responses to question four or elsewhere in the survey are covered at section three of this report, while specific comments on the proposed indicators are covered under the other three consultation questions.

We received responses from a total of 27 organisations, including:

• 8 local authorities
• 13 Registered Social Landlords
• Scottish Federation of Housing Associations (SFHA)
• 5 Tenant Networks

We published responses on our website here. Thank you to everyone for sharing your views with us. 

Key themes from the consultation

SHR’s monitoring of landlords’ progress with EESSH2 will be based on Scottish Government’s final guidance. There was broad agreement on the proposed indicators but, landlords raised concerns about some elements of the new milestone.

SFHA referred to discussions with SG about members’ wider concerns regarding meeting targets and the costs involved. They also queried, along with one other landlord, whether SG’s proposal to bring the formal 2025 review forward to 2023 as set out in the recently published Updated Climate Change Plan 2018 to 2022 would impact SHR’s approach.  We do not anticipate that changes to SG’s guidance would require changes to these elements of SHR’s proposed indicators. 

Several landlords highlighted concerns about the availability of guidance on air quality which Scottish Government plans to provide, while a small number of landlords wanted guidance on environmental impact data collection and the proposed indicator post 2025. SG is aware of these issues and will consider them in drafting its final guidance.

A small number of landlords also asked for links to best practice and other helpful guidance to be included. Scottish Government will take this on board in drafting final guidance and SHR will incorporate links in its Technical Guidance for landlords. 

A small number of respondents asked that the indicators should include details of the SAP methodology used. SG draft EESSH2 guidance at paragraph 4 says that, “EESSH milestones are defined by Standard Assessment Procedure (SAP) 2012 methodology.  Older versions of SAP can be converted to SAP 2012.”  We therefore expect EESSH2 returns from landlords to be based on SAP 2012.  Both SG and SHR will include a link to SAP 2012 and the conversion tables in final EESSH2 guidance and SHR Technical Guidance.

Some landlords highlighted the limitations of the Standard Assessment Procedure (SAP) and Reduced data SAP (RdSAP) including the potential for different assessors to make different decisions. SG is aware of SAP and RdSAP limitations and has tried to incorporate some flexibility in its guidance to help account for this.  One respondent provided detailed comments showing that where mechanical ventilation heat recovery systems are installed, RdSAP software reduced the SAP score by nine points.  Revised SG guidance will allow landlords to disregard the reduction in the SAP score due to the installation of ventilation.   

Some respondents are concerned about the cost of improvements to meet EESSH2 and wanted to know what help might be available. SG will signpost potential funding sources but acknowledges in its guidance that measures can be expensive and many will be funded from the landlords’ own resources.  A small number of landlords said clear guidance on Indicator 4 “Investment in EESSH2” was needed and we will incorporate this into our Technical Guidance. 

One tenants group said it was concerned about the timeframe for meeting the new milestone, while one tenants group wanted landlords to progress as swiftly as possible to achieve benefits for tenants.  

The scope of the proposed indicators (Question 1)

We asked if there was anything not covered by the proposed indicators and 23 (85%) respondents to the consultation said there were no gaps.

Table 1 provides a breakdown of how respondents answered the question: Is there anything not covered by the proposed indicators?

Three landlords, (two local authorities and one RSL) suggested adding indicators. Two suggested adding indicators related to fuel poverty and anticipated savings on fuel bills for tenants.  One landlord suggested that we should collect data on the environmental impact rating, although this is not a Scottish Government requirement until 2025.  One landlord suggested adding an indicator which reports on the number of properties where all reasonable measures have been installed but the property remains non-compliant.  These properties would be subject to temporary exemptions and should be recorded at indicator 3.  

One local authority suggested that indicator 4, “Investment in EESSH2” could be expanded to include cost per property. We will publish data from EESSH2 returns along with Charter data from Autumn 2022 which will allow landlords and tenants to review investment data.  SHR, landlords and tenants will be able to calculate average investment costs per property from these EESSH returns.  The landlord also said there was a need for guidance on reporting EESSH2 costs and this will be included in SHR’s Technical Guidance for landlords.   

We are committed to only collecting from landlords data that we will use so we have decided not to add an indicator on EESSH related rent increases, each individual EPC band, anticipated fuel bill savings or environmental impact. SG draft guidance at paragraph 46 suggests that landlords should take account of total projected fuel savings for tenants in developing a policy on cost-effective investment.  This is therefore information which landlords will want to factor into their policies and we do not plan to collect it.

Likewise, Landlords will have modelled environmental impact information in EPCs and SG advises that they should start to collect this in preparation for 2025. SG also plans to provide further guidance for landlords on meeting the environmental Impact element of the EESSH2 milestone. Very few landlords commented on the proposed EPC bandings and the two who did expressed opposing views.  We therefore do not plan to change our proposals for indicator 1. 

Several respondents stressed the importance of SHR providing clear guidance. Indicator 1 asks landlords to summarise/evidence work on homes which do not meet EPC band B but are classed either as, “can be treated as meeting EPC Band A or B” (indicator 1(iv) – 1(vi); or “being as energy efficient as possible within constraints of cost, technology and consent” (indicator 1(vii)-1(ix)).  We will provide information for landlords in our Technical Guidance.  We will not ask landlords to submit supporting evidence along with their EESSH2 return but we may want to look at this at some future date. 

One tenants’ group highlighted the challenge for landlords in dealing with mixed tenure in its properties. Where landlords are unable to carry out work for this reason they will be able to report it at Indicator 3(ii) total homes that are subject to social objections. 

The right indicators (Question 2)

We asked if there were any indicators that were not There was general agreement amongst respondents that the proposed indicators are appropriate with just over 85% (23) answering “No” to this question.  

Table 2 provides a breakdown of how respondents answered.

Given the broad agreement with this question, we do not intend to add any indicators. One landlord felt it was not necessary to ask at 1(xi) (t)otal homes where energy efficiency rating is not known.” We anticipate that there could be a very small number of properties where the EPC band is not known at the time of reporting.  This could be because the property has characteristics which mean energy efficiency data cannot be cloned and an assessment has not been carried out. 

Unnecessary or missed information in indicators (Question 3)

We asked if there was any unnecessary or missed information in the proposed indicators. Almost two thirds of respondents (63%) said that there was nothing unnecessary or missed, while one third thought there was.

 Table 3 provides a breakdown of how respondents answered the question: Is there any information we ask for that you feel does not need to be included or that we have missed?

The points raised by landlords in response to question 3 have been covered at section 3 of this report.

Other comments and suggestions (Question 4)

We invited respondents to make any additional comments or suggestions and this section summarises the issues raised which have not been covered above and our response to them.

Table 4 provides a breakdown of how respondents answered the question: Would you like to make any other comments or suggestions about our proposed indicators?

In recognition of the exceptional demand pressures some landlords may face, particularly in rural and island locations, SG plans to add a further temporary exemption to allow landlords additional time to bring stock up to band D. This additional temporary exemption category will be added to Indicator 3.  

Comments and suggestions raised by landlords at this question have been covered at section 3 of this report.

Conclusions

Respondents broadly agreed that the indicators were appropriate and neither missed information, not asked for information that was unnecessary. Respondents were keen to emphasise the need for clear guidance, from SG on air quality and environmental impact and from SHR on Indicator 1 in particular.  There was concern about the costs of EESSH2 and that investment should benefit tenants. 

We therefore, with the exception of the additional temporary exemption added by SG, do not plan to amend or add any indicators but will undertake to ensure that language and guidance is clear with useful links and signposting for users.