Summary
This is a report on the fifth of a series of "prototyping weeks" run by mySociety in 2022. The central question for the week was:
How could a digital service improve energy efficiency in the private rented sector?
Housing accounts for 14% of UK emissions, of which around one fifth comes from the private rented sector. Meanwhile, over a third of "fuel poor" households in England live in privately rented properties. This is a sector with a significant impact on the country's Net Zero goals, and yet with the most challenges around making the cost of home energy improvements stack up.
Private rental tenants are often those least able to afford costly improvement works to their homes. And misaligned incentives between landlords and tenants mean that concrete action is thin on the ground – the "investment now to save on bills later" calculation that makes sense for some homeowners simply doesn't apply when tenants pay bills and landlords pay for improvements.
Our workshops at the start of the week identified three main challenges we could go on to explore: the power imbalance between landlords and tenants; a lack of information (for tenants and local authorities) on energy efficiency; and enabling tenants to make the most use of their existing rights in regard to legislation like Minimum Energy Efficiency Standard(MEES), Housing Health and Safety Rating System (HHSRS), and the Housing and Planning Act 2016.
We sketched out two potential prototypes—a tool for councillors and climate action groups to visualise the change required in energy efficiency in rented accommodation in their area, and an informational / educational tool for tenants to understand their rights and challenge incorrect EPC ratings—and chose to build and test the latter.
Our testing verified that the landlord/tenant relationship is indeed a major challenge. We found that cost savings are likely the strongest motivator for tenants (though not without their challenges, given the potential for landlords to raise rents to cover the cost of improvement works), and that more work needs to be done if we're going to scratch beneath the surface of energy efficiency for the typical rental tenant.
As a result, we've recommended a number of next steps, including exploration of how landlords can be prevented from passing an unfair proportion of retrofit costs on to tenants; how tenants can be empowered to understand and verify their own EPC assessments; and how we could introduce a ‘new normal' where landlords use the energy efficiency of their properties as a selling point.
About the prototyping weeks
mySociety is the charity behind UK civic services like TheyWorkForYou, WriteToThem, and WhatDoTheyKnow. We build open, digital solutions to help repower democracy, in the UK and around the world.
Our Climate programme has the goal of facilitating the reduction of the ~30% of UK carbon emissions that are either directly controlled or influenced by local government. We are doing this by deploying data and digital services to support a faster, fairer, more collaborative response to climate, enabled by local democratic institutions and processes.
We believe that digital services have a role to play via:
- More public participation to drive political action
- Local government learning, action and innovation
- A better information ecosystem around local democratic climate action
We're exploring ideas for new digital services, and actively looking to identify opportunities to work with and in support of other organisations. One way we're doing this is through prototyping weeks – where we work with others to research, explore, prototype and test ideas.
Themes for each prototyping week are chosen in advance, and participants for the week are invited from our own network of contacts, as well as relevant industry / public sector networks.
The theme for the prototyping week and therefore the subject of this report was improving energy efficiency in the private rented sector. What follows is a summary of what we did and found during that prototyping week.
Background: energy efficiency in the private rented sector
The decarbonisation of the private rental sector is a major part of the UK's roadmap to net zero by 2050. 14% of the UK's emissions come from energy use in homes – homes of which around 20% are privately rented.
Local authorities have direct and indirect influence over large amounts of the building stock in their areas – from owning their own council housing, to regulating many aspects of the social and private rental sector, and making planning decisions that impact the quality and energy efficiency of future housing stock. Most of the housing that will exist in 2050 already exists, so the challenge is bringing those existing properties up to the energy efficiency standards required for significant decarbonisation: a process usually referred to as "retrofit".
More than this, Russia's invasion of Ukraine in early 2022, and the effect it has had on Europe's access to fuel, has rapidly brought household energy efficiency into the national consciousness. Nowhere more so than in the private rental sector where, according to the Committee on Fuel Poverty, 35% of fuel poor households in England live in privately rented properties (2015/16 data).
Energy Performance Certificates (EPCs) are one way of measuring the energy efficiency of a building. Each EPC takes into account a number of characteristics of the building, such as its windows, doors, and roofing, as well as the type of heating used in the property, and uses this data to present a single efficiency "rating" for the building—on a scale from A (very efficient) to G (very inefficient)—as well as a report on energy efficiency improvements that could be made.
Since 2008, the Minimum Energy Efficiency Standards (MEES) have required that rental properties in England and Wales reach a minimum EPC rating of E (or an exemption) in order to be rented out. However, in 2020, the government set a commitment to "upgrade as many private rented sector homes as possible to EPC Band C by 2030, where practical, cost-effective, and affordable."
The (draft) Energy Efficiency (Domestic Private Rented Property) (Scotland) Regulations 2020 proposed that Scottish tenancies should reach EPC Band D by 2022, but after COVID-19 disruption made the 2022 deadline unachievable, the draft regulations were scrapped. Meanwhile, the Minimum Energy Performance of Buildings (No. 2) Bill has been progressing through UK parliament since 2021, with the aim of requiring a minimum EPC rating of C for all new tenancies in England & Wales, starting from 31 December 2025, and all existing tenancies ("where practical, cost-effective, and affordable") from 31 December 2028.
Thanks to the Energy Efficiency (Private Rented Property) Regulations 2015, private rental tenants in England & Wales have a right to request alterations to their property, and the landlord cannot unreasonably refuse consent – but knowledge of this right is likely quite low, and the legislation does nothing to prevent unfair increases in rent, or ‘retaliatory' evictions, as a result.
Perhaps as a result, EPC ratings for private rental properties in the UK right now remain low: 60% of the current private rented stock would need some kind of improvement to meet a C grade.
Above: Proportion of private rental properties in each EPC band, in England & Wales. Source:EPC data for England and Wales, Department for Levelling Up, Housing & Communities (2022-05-04)
It seems highly unlikely that increased energy efficiency in the private rental sector can be left to the market. Without additional funding, landlords looking to recoup the costs of improvement works will inevitably end up raising rents. Many landlords in the lower end of the market will find the Local Housing Allowance's effective cap on rents means the deepest, most effective improvement works simply cannot be paid for through rent increases alone.
Setting aside the issue of misaligned incentives, public sector bodies have questioned how we could possibly enforce an increased minimum efficiency standard when many landlords are already failing to meet the current, lower standard. The Committee on Fuel Poverty made a number of recommendations for stronger enforcement of MEES standards, including:
- Better monitoring of properties through a national landlord register, funded by landlord fees
- Better use of existing datasets to piece together energy efficiency data
- Building of capacity within local authorities (and specific funding to allow them to do so)
- Educating tenants on their rights, and empowering them to take rogue landlords to court
We have explored these recommendations in more detail, in our 2021 scoping report.
It is also worth noting there are a number of support schemes to enable landlords to improve their homes—including the Energy Company Obligation (ECO4) scheme and the Green Homes Grant Local Authority Delivery (LAD) scheme—but since these only apply to landlords and owner-occupiers they do little to empower rental tenants.
Workshop outputs
We were joined by participants from organisations including Generation Rent, London Renters Union, Carbon Co-op, and TowerBlocks UK, for the week's opening prototyping workshop, aimed at uncovering the challenges and opportunities around enabling private rental tenants to improve the energy efficiency of their homes.
We used a 'lightning decision jam' format first, to gather examples of success indicators and challenges. Positives included:
- Multiple benefits of efficiency – including not just cost savings, but also the health benefits of warmer, less draughty homes, and also the economic benefit of increased employment in the retrofit industry.
- Energy crisis – participants noted the cost of living crisis, fuel price rise, and continued climate crisis, have kept energy efficiency in the news, and there appears to be political will behind resolving the inequalities.
- Skills and enthusiasm – participants felt that a number of organisations with different skill sets—campaigning, legal rights, building design, retrofit—are all active in the space.
- Data – a number of participants were excited by the potential of open EPC data to enable action on under-performing properties, for example, as used in Friends of the Earth's Near You tool, to identify areas which should focus on retrofit over other climate actions. In addition, since MEES requires rented properties to have an EPC, coverage is fairly high.
- International examples – such as Ireland's National Retrofit Plan, and Italy's superbonus scheme which offers a tax credit of up to 110% on retrofit works for energy efficiency and disaster preparedness.
- Government interest in reform – including growing momentum for the Renters Reform Bill and a landlord registry. Participants were wary of getting too excited about reform that hasn't been delivered yet, but were positive that policy makers seem to be paying attention to detail, and learning from past failures.
Challenges noted by participants included:
- Power imbalance between landlords and tenants – the unfairness of tenancy agreements, the ability for landlords to end a tenancy for almost any reason they like, and the perceived tendency for courts to side with landlords in disputes, all contribute to a chilling effect, where tenants are discouraged from asking for better.
- Misaligned incentives – landlords do not benefit from energy bill cost savings, and tenants do not benefit from making permanent improvements to the property. There was anecdotal evidence that, once a property's energy efficiency is raised, the rental price also increases, cancelling out any energy bill savings.
- Delayed / flawed regulation – as mentioned above, there was scepticism over whether the promised reforms for the rental sector would ever come. Meanwhile, the protection offered by existing regulation (such as MEES, HHSRS, and the Energy Efficiency Regulations 2015) is patchy, and often lets down even the most vulnerable renters.
- Data limitations – while a valid EPC is theoretically required for all rental properties, in reality many EPCs are out of date or missing. We heard how EPC data is useful in aggregate but less useful at an individual property level, and how the EPC methodology for retrofit is too simplistic.
- Local authority capacity constraints – rental standards are regulated by chronically under-funded local authority enforcement teams, meaning local authorities are very rarely proactive. Less and less central government funding is made available to local authorities or citizens themselves for retrofit projects.
- Practical barriers to retrofit – including the disruption caused by retrofit works (which might require tenants to move out), the challenge of finding and organising retrofit suppliers, and the danger of poorly installed retrofit measures actually having a negative impact on homes over the long term.
Related successes and challenges were then prioritised through dot-voting, drawn out into groups, and investigated through the generation of "how might we" statements on four overall themes.
Through consideration of these statements, along with quick-fire "Rapid Eights" ideation and open discussion, a number of potential ideas for prototyping emerged, which we have listed below, under each theme.
How might we incentivise landlords to do the right thing? How might we protect tenants against retaliatory rent increases or evictions? How might we enable collective action or safety in numbers? How might we make between-tenancy retrofit more efficient for landlords?
Ideas for testing included:
- Organised action against large-scale landlords.
- Services to promote / create renters unions.
- Getting letting agents to play a positive role in coordinating improvements / retrofit.
- Tie-ins with "green mortgage" lenders, to give preferential rates to landlords who make their properties more efficient.
- "Meet in the middle" – splitting bill savings with landlords, to incentivise their cooperation.
- Template letters or group sign-up (conditional commitment) amongst rental neighbours, to provide safety in numbers, and a united proposition to landlords.
How might we help tenants understand the impact of EPCs on their lives? How might we help tenants understand their rights? How might we help landlords and tenants make a long-term plan for energy efficiency improvements? How might we produce datasets that can be incorporated into platforms like Rightmove?
Ideas for testing included:
- "Is your EPC dodgy?" – tool for finding, understanding, and verifying your rental property's EPC, identifying mistakes or inaccuracies that were used to push your property up a band higher than it really should be.
- Send postcards to properties with borderline EPC scores – "Here's what you can do about it" – routes for both owner-occupiers and rental tenants.
- Visualise the effect that improved EPC scores could have on emissions in your area.
- Service that suggests interventions that are most suitable for your property (something similar already exists for social housing providers).
- Online league table of council action on energy efficiency in rentals.
How might we help tenants access routes of appeal? How might we make rent repayment orders more accessible? How might we build an evidence base of incorrect/corrupt EPC ratings, to give to government? How might we help tenants find out if their EPC is wrong, and fix it / challenge it?
Ideas for testing included:
- Guides and online forms for accessing Rent Repayment Orders.
- Guides and template letters for asking your landlord to improve energy efficiency, and routes to escalate if they don't. Ideally including examples / case studies from people who've already done this and succeeded.
Prototype: Renters Energy Checklist
By this stage in the process, participants were interested in two potential ideas for prototyping. While we could only take forward one idea, we include a summary of both below, in case someone else wants to pick up the second (un-used) idea.
Informational / educational tool for tenants to understand their rights and challenge incorrect EPC ratings | |
|---|---|
Key points
| Testing what?
|
Informational / educational tool for tenants to understand their rights and challenge incorrect EPC ratings
Key points
- What EPCs are and why they matter. What a D/E or F/G grade means for your rights.
- Find out if your EPC might be wrong – you might be due extra support in lowering your energy bills.
- How to challenge incorrect EPCs.
- Show people local groups to join for support.
- If we ask people to tell us whether their EPC was correct, we could generate aggregate data on incorrect EPCs, and the assessors handing them out.
- Danger that nothing will happen as a result – challenging an EPC is hard, and not much pay-off for tenants.
Testing what?
- How do we make energy efficiency and EPCs make sense to tenants?
- What are the next steps they will take?
- Which hook is best? (cost saving, wellbeing benefits, or emissions reduction).
- Will tenants challenge their EPC, given the anti-tenant power dynamic?
- Is there a good bridge from more EPC information to council action?
- Could this help local authorities detect EPC "fraud"?
A tool for councillors and climate action groups to visualise the change required in energy efficiency in rented accommodation in their area | |
|---|---|
Key points
| Testing what?
|
A tool for councillors and climate action groups to visualise the change required in energy efficiency in rented accommodation in their area
Key points
- Current state of energy efficiency in rented sector in your area.
- Producing stuff that local authorities steal and put into their presentations – making a case to decision-makers.
- Visions of the future – emissions estimated in good and bad scenarios.
- Data – EPC averages/distributions; Council climate goals; Energy costs over time, with/without retrofit.
Testing what?
- Effective means for applying local pressure?
- Useful tool for local campaign groups?
- Is there a UK nation this works better/worse in?
- Are we duplicating effort from other organisations, like Friends of the Earth?
- Useful to local councillors? (pre/post-election).
- Useful to council officers? (making a case for funding, etc).
- Which hook is best? (cost saving, wellbeing benefits, or emissions reduction).
We decided to test the tool for individual tenants to understand and challenge their EPC ratings, and quickly storyboarded and built a point-and-click prototype, which is available at https://mysociety.github.io/renters-energy-checklist. The two screens from the prototype are included below.
The homepage features a strong call to action "Energy prices are soaring … here's one way to take control", along with a summary of how energy efficiency affects your energy bill, and a form to "Find my EPC" by postcode. There's a checklist describing the features of the tool, along with a mention of "UK charity mySociety" to engender trust.
The form leads to a page with five main sections. First there's a summary of the property's EPC data, including the current and potential ratings and costs. Next there's a warning about an EPC "on the borderline", followed by energy efficiency features in your property that you should check. Then there are next steps (guides, support groups) and links to support organisations in the sector.
Prototype feedback
We tested the prototype with eight target users:
- 4 rental tenants, in locations across the UK
- A researcher, with a focus on ethnicity, disability, and marginalised communities
- A researcher in AI and Data Ethics, at Data Trusts for Net Zero
- An organiser at London Renters Union
- The deputy director of Generation Rent UK
Their feedback helped us understand more about the questions we'd identified:
Although our prototype attempted to simplify EPCs and energy efficiency for a non-expert audience, it's clear that we could have gone further in eliminating or explaining some of the jargon in the sector. Displaying a complex-looking EPC number, and describing it as "RdSAP" confused one of our testers. Another tester asked what the point of the expiry date was – and what they should do as a result.
Testers generally responded well to the A-G banding, especially on the homepage graphic, but once they were shown their property's specific grade, it was hard for them to know how "good" or "bad" that grade was, out of context and without more detail. We found the concept of "being on the borderline" was also quite nuanced – it took a while for testers to understand what their position close to the E/F boundary meant for them, and even whether it was good or bad. (Notes)
"Your EPC is on the borderline - ah, wow! That's interesting. So by the law I should have an E or above?… I didn't realise that was a legal requirement."
— User testing participant
"It says ‘EPC type RdSAP Warning!' I would have expected a tooltip to explain that more. It looks negative, but it's actually an opportunity, because it means I'm more likely to be able to get my landlord to act."
— User testing participant
A couple of respondents asked whether we could reduce the geeky jargon and instead be bolder about showing potential energy cost savings. One asked that, where savings are already shown, we perhaps try to break them down, to explain how they've been calculated, so that tenants could work out which actions might apply in their situation. The question of which "hook" is best—cost saving, wellbeing benefits, or emissions reduction—is something we revisit later in this document.
Finally, we got the sense that the service would be more persuasive if people could plug in their own energy usage figures and get a more personalised estimate of costs/savings. But we are also aware of the limited smart meter penetration in the private rented sector, and even for tenants who have one, the challenge they might face in extracting the right information out of it. Where a smart meter is present, integration with one of the data providers in the Smart DCC network could potentially enable fully automatic extraction of usage patterns, though likely at a cost. (Notes)
"The more specific this is, the more interesting. So if there was a way to plug in annual energy use data, you could actually quantify gains or particular changes."
— User testing participant
Here we found a really mixed picture. Some tenants we spoke to would be happy to raise the subject with their landlord (especially if they had support materials that helped them couch it in a positive, constructive way). Others were more apprehensive. (Notes)
"I'm someone who is savvy about managing this stuff once I know what it is that needs to be managed. I'd be comfortable going off and speaking to my landlord if there's some wording spelling out what I'm asking of them. Don't have particularly good relationship, but privileged in all the ways you'd expect. I'm a good tenant."
— User testing participant
"Lots of people are worried about asking their landlord for anything [that] will get them kicked out, so emphasising that this is something you have a right to is important. Still, even that might not be enough to give people the confidence to engage their landlord…"
— User testing participant
We heard from two tenants who considered their landlords to also be friends – one thought the pre-existing friendship would help them raise the subject (in a "let's fix this together" way) while the other worried it might sour their relationship.
One size is clearly not going to fit all, and next steps will vary significantly based on the type and strength of a tenant's relationship with their landlord.
One respondent suggested sticking much more to the angle that this level of energy efficiency is your right, and requesting it is nothing personal against the landlord. Another was feeling quite apprehensive about the proposition of asking their landlord to improve standards, until they saw the wording around this being a legal right, which emboldened them somewhat: (Notes)
"You'd be surprised at how little people know about their rights, or the responsibilities of their landlord. There's a general feeling that, unless it's the boiler breaking, it's the tenant's responsibility."
— User testing participant
"Now that I've seen the ‘By law' bit, I'm thinking now maybe it does apply to me!"
— User testing participant
We expected testers might ask for support materials to help them raise concerns with their landlords – much like the template letters available to tower block residents in a previous mySociety joint project, FixMyBlock.
While some testers mentioned template letters, we were surprised to see that many actually thought landlord-facing materials would be more useful. Such advice for landlords could not only demonstrate value for money, and answer the landlord's questions about how the whole process works, but potentially also link landlords up with funding opportunities. (Notes)
"If it pointed at funds and grants available to landlords, it would be easier for tenants to engage with landlords."
— User testing participant
"Could it provide a template they can use for engaging their landlord? And make it seem less scary? It should be something that I would be able to understand (in case I'm challenged) and that I felt wouldn't get me into a confrontation. More geared for the landlord to benefit from – something to make me feel less like they'll retaliate."
— User testing participant
As expected, cost savings serve as an eye-catching hook. But a number of respondents were less keen once they followed the thought process to its conclusion and realised landlords would likely just increase rent to recoup costs, cancelling out any energy efficiency cost savings for the tenant. One tester noted that, even if their rent did go up, "it's a net positive from an environmental perspective" – although we doubt most tenants would see it that way.
The feedback did lead us to wonder whether there might be ways to incentivise the more socially-conscious landlords to keep rents the same – a pledge perhaps? Such a scheme would, however, also need to account for other reasons landlords might increase their rents, such as the high inflation we're currently seeing in the UK. (Notes)
"The fact that the financial saving is headlined is good – clear reason why I'd go to the effort of doing this stuff."
— User testing participant
"Money is my top priority, and health next. […] I'm aware of the environmental concerns but that's not the primary consideration for anyone I know."
— User testing participant
Our respondents were generally receptive to the environmental benefits of making energy efficiency improvements to their home – but we expect that is really a result of our limited sample. We know that rental tenants are more likely to be vulnerable, or on a limited income, than home owners. It seems unlikely that the public good of environmental change will trump the sheer cost and inconvenience of retrofit, for tenants like these. Especially if the very act of asking for the efficiency changes to be made, might endanger your tenancy itself. (Notes)
"Would I put time and effort into making someone else's property more energy efficient without benefit to me? I'd like to say yes, but realistically, it would be very low on my list. Unless you know you're going to live there for an extended period, it's very hard to see that there's a financial incentive."
— User testing participant
One respondent wondered whether the angle of improving "energy security" might be a way to get local councillors on board – who could then potentially act as impartial third parties in landlord/tenant disputes, or de facto enforcers thanks to the local authority's regulatory powers over private lettings in their area.
Finally, there was some indication that people might check a tool like this when looking to move into a new rental property – "Just like you look up the crime stats for an area before you move there," said one respondent. Another wondered whether the service could integrate with rental listings and search sites – showing not only the current EPC of the property, but also the landlord's willingness to work with the tenant to improve it.
Copyright and licensing
This work is licensed under a Creative Commons Attribution 4.0 International Licence. (CC BY 4.0)
It can be downloaded at https://research.mysociety.org/publications/prototyping-work