Residential developers who meet green standards can now access a new Green Homes Incentive that will help deliver more thermally efficient and lower carbon homes in Wales.

Funded by the Welsh Government, the Green Homes Incentive is available on residential development loans from Development Bank’s Wales Property Development and Wales Stalled Sites Funds and includes a reduction in loan repayment fees of up to 2%.

Finance for up to 100% of building costs is available with interest rolled-up throughout the loan term. Eligibility will depend upon qualifying criteria that includes EPC A Rating/Passivhaus status, non-concrete structures and non-fossil fuel heating systems.

The operation of buildings accounts for around 30% of emissions in the UK, mainly from heating, cooling and electricity use.  For new buildings, the embodied emissions from construction can account for up to half of the carbon impacts associated with the building over its lifecycle.

The latest RICS data (2020) shows 77% of all new builds in Wales achieved an EPC B rating, with only 5% achieving an A rating. Additional insulation, double/triple glazing and solar panels can all help to improve EPC ratings.

It is also widely accepted that alternative structures such as timber frames, hempcrete blocks, limecrete blocks and mycelium bricks have a lower carbon impact than concrete. The use of timber frames has become more commonplace over the last decade but recent global pressures on timber cost and availability have led to a number of developers reverting to concrete hence the need for financial incentives.

Developers that install non-fossil fuel heating systems will also be able to benefit from the new incentive as ground and air source heat pumps significantly reduce operational energy demand during the life of a property.

Minister for Climate Change, Julie James said: “Tackling the climate emergency must be at the heart of everything we do in Wales as we all work together across this decade of action.

“The Green Homes Incentive will support SME housebuilders in delivering low carbon homes, part of our journey to a Net Zero Wales by 2050.

“Finding innovative ways to improve the energy efficiency of new homes will also bring down costs for homeowners which is crucial as we help people through a cost of living crisis.”

Giles Thorley, Chief Executive of the Development Bank said: “Sustainable business is at the heart of our core principles, so we want to support developers making the change to greener development practices as part of the Team Wales effort to build a stronger, greener economy.

“Our Green Homes Incentive offers reduced lending costs for housing schemes that will help to deliver more thermally efficient and lower carbon homes in Wales. It’s the first of several initiatives as we look to support the journey to net zero with funding that helps forward-thinking companies to address climate change.”

Cenydd Rowlands, Property Director at the Development Bank, said: “We are already seeing examples of developers wanting to make the change towards more eco-friendly options particularly given the upcoming changes in building regulations which are likely to impose higher eco-standards across all new schemes.

“We know the importance developers place on certainty of funding.  This has become even more important of late given the additional uncertainties around other key elements of development, such as supply availability and material cost inflation. Our dedicated property team is here to help with a quick decision-making process that is designed to get more developers building greener housing as quickly and efficiently as possible.”

Cardiff-based developers Wellspring Homes hope to use the Green Homes Incentive for their next development. Using local contractors, the company is close to completing the construction of its first property built using Hempcrete, a natural ‘better than zero carbon’ material that is breathable. Planning permission has been granted for their next development in Neath that will feature eight low-carbon homes. With an A grade energy rating, all will have solid wall construction using Hempcrete and will be fitted with air source heat pumps.

Director Hadleigh Hobbs said: “We’ve got an opportunity to build housing differently in Wales by using more innovative methods of construction to deliver the next generation of living space. Each one of our homes is being built using solid Hempcrete walls. This gives really good thermal mass with its unique properties helping to store and release heat from the building’s walls, limiting fluctuations in temperature, reducing energy costs and virtually eliminating condensation by releasing internal moisture. The use of hemp within the walls also locks up carbon dioxide in the structure of the building.

“However, funding is essential for our industry if we’re going to scale-up and deliver more low carbon homes in Wales. This is what will enable us to refine the technology and make the homes of the future commercially viable.  The Development Bank understands this challenge and is now able to offer the support needed to drive down carbon emissions with the development of new homes that are well-built, beautiful to live in and beneficial to our natural environment.”

(Lead image: Wellspring Homes)

The Welsh Government have announced new planning laws, a statutory licensing scheme and proposals to change land transaction tax as part of a package of measures aimed at addressing numbers of second homes in Wales.

First Minister Mark Drakeford and leader of Plaid Cymru Adam Price set out the next steps in a programme of actions to help create thriving communities and to support people to afford a home, in a joint press conference today (Monday 4 July).

The Co-operation Agreement between the Welsh Government and Plaid Cymru includes a commitment to tackle the issue of second homes affecting many communities in Wales.

The package of measures being announced today includes changes to planning regulations by the end of the summer. These will introduce three new planning use classes – a primary home, a second home and short-term holiday accommodation. Local planning authorities, where they have evidence, will be able to make amendments to the planning system to require planning permission for change of use from one class to another. The will also be changes to national planning policy to give local authorities the ability to control the number of second homes and holiday lets in any community.

Also announced were plans to introduce a statutory licensing scheme for all visitor accommodation, including short-term holiday lets, making it a requirement to obtain a license. The Welsh Government say this additional regulation will help raise standards across the tourism industry.

Following a consultation about varying land transaction tax (the Welsh version of Stamp Duty) locally in areas with large numbers of second homes, the Welsh Government announced that work will start today (Monday 4 July) with local authorities to develop a national framework so they can request increased land transaction tax rates for second homes and holiday lets to be applied in their local area.

The Welsh Government say they have already introduced a range of measures to address the issue of second homes, including giving councils the discretionary power to increase council tax premiums on second and empty homes and it has changed the rules on holiday lets so owners and operators make a fair contribution to their local communities.

First Minister Mark Drakeford said: “We are today setting out the next steps in a radical programme to ensure everyone has the opportunity to afford to live in their local community – whether that’s buying or renting a home.

“We have a shared ambition for Wales to be a nation of thriving communities – a country where people do not have to leave to find good and rewarding work and a country which people want to come to visit and to live.

“Tourism is vital to our economy but having too many holiday properties and second homes, which are empty for much of the year, does not make for healthy local communities and prices people out of the local housing market.

“There is no single, simple solution to these issues. Any action we take must be fair. We do not want to create any unintended consequences, which could destabilise the wider housing market or make it harder for people to rent or buy.”

Plaid Cymru Leader Adam Price said: “We are committed to using a range of planning, taxation and property levers to tackle the issue of second and unaffordable homes – and to do so with urgency.

“The package of purposeful measures that have been developed as a result of the constructive cooperation between Plaid Cymru and the Government in this area will, together, begin to address the injustices in our housing system and make a real difference to people and communities right across our nation.

“The aim is to give everyone ‘yr hawl i fyw adra’– the ability to live and work in the communities in which they grew up.”

The bus industry in Wales is set to receive a support package worth £48m to help them recover from the impact of the pandemic and deal with emerging financial challenges, the Welsh Government has announced today.

The Bus Emergency package will provide ‘gap funding’ until the end of this financial year for bus operators to maintain the necessary bus services and routes in their area, in return for greater public control over Welsh bus services.

This funding is one of a number of short-term measures that have been taken by the Welsh Government to support bus operators at a time when they needed it the most. With the longer-term future of the bus industry in mind a review of the existing Bus Services Support Grant (BSSG) scheme will also be taken to consider how it can be used to move the industry away from a reliance on emergency funding schemes and bridge the gap to franchising.

Announcing the latest emergency funding package, Deputy Minister for Climate Change, with a responsibility for transport, Lee Waters said: “The bus industry is emerging from some of its toughest times, and we need to continue to provide support to help the industry recover and secure a healthy future.

“During the pandemic passenger numbers fell by around 90% and have still only returned to between 50% and 70% of pre-Covid levels, leaving operators struggling with reduced revenue and contending with the latest challenges of rising fuel and operating costs.

“The funding I’ve announced today will provide a short-term solution to help the industry to begin to recover from the challenges it has and continues to face whilst we develop a longer-term solution to tackle the gradual decline in passengers over the years.

“In March I set out our plans to bring forward legislation to change the way bus services are delivered across Wales. Throughout this process we will be working closely with local government, the bus industry and passengers, to design a system that is ‘easy to use, easy to access and well connected’ providing people a ‘real sustainable transport alternative’ to the private car.

“We will provide an update on how these plans are progressing later this year.”