The 2025 Gas Boiler Ban

solar alternative to gas boiler

IMPORTANT UPDATE:

In September 2023, the UK Government made significant updates to their over-all targets for Net Zero. Some of our articles relating to energy legislation provide timelines which are now inaccurate. We therefore have an updated summary for proposals and dates mentioned post 2023. For the latest updates, please see:

Government changes to EPC’s and gas boiler legislation – Finch (finch-app.com)

What's driving the 2025 Gas Boiler Ban?

“In 2025, compliance with the Future Homes Standard (FHS) will become mandatory. Its aim is to ensure that new homes built from 2025 will produce 75-80% less carbon emissions than homes built under the current Building Regulations.” – CBRE

The first thing to note with the new legislation is that gas boilers are not being banned in all properties from 2025 but instead, part of these new regulations are likely to be the substitution of gas boilers with energy efficient alternatives within new build homes. This means that current homes with gas boilers will continue on as they are, but developers and builders of new homes will need to make a decision on which alternatives will be installed into properties. 

Although this new legislation largely affects developers, landlords planning to extend their portfolio should still be aware of the new regulations. If for example, a landlord is considering a new build as their next investment, they should be mindful that although gas may not be running into the property for the boiler, a gas safety certificate may still be required if the property includes other gas appliances such as a gas cooker. 

For landlords with existing portfolios, British Gas have stated that: “There is no legislation on gas boilers that means you must scrap or replace your existing boiler, either before or after 2025. If yours is relatively new and still doing a good job, then there’s no reason to get rid of it

Is this a staged roll-out?

As this is still under technical consultation, the dates given are the past and current considerations to offer a good understanding of where the the Future Homes Standard stands. The initial consultation has been completed to determine the overall plan and so we are now at the technical consultation stage to map out how the FHS will be implemented. The key dates are:

  • 2019 (Spring) – Government announces a Future Homes Standard by 2025 “so that new homes are future-proofed with low carbon heating and world leading levels of energy efficiency.”
  • October 2019 – The consultation on both the conservation of fuel and power, and ventilation to make changes to The Building Regulations for new homes to improve the energy efficiency of England’s buildings.   
  • 2021 – The Government responded to the consultation and The Future Buildings Standard. 
  • 2022 – Overheating Regulations came into effect, meaning that developers must submit building notice, initial notice or deposit plans by June of 2022 for transitional arrangements to apply.
  • 2023 – Full technical consultation on the Future Homes Standard with consideration of required/ appropriate transitional arrangements.
  • 2024 – legislation to be put in place for Future Homes Standards.
  • 2025 – The Future Homes Standard will be implemented

What’s the reason for the removal of gas boilers?

The UK government has made a firm pledge to achieve carbon neutrality by 2050. Discovering an alternative to fossil fuels is crucial for attaining this ambitious goal. As a continuation of the Heat and Buildings Strategy, the upcoming focus is on addressing emissions from residences and enterprises. A significant component of this effort involves the gradual elimination of natural gas-powered boilers. The primary aim is to successfully realise the objective of reaching net zero emissions.

boiler ban

What are the alternatives to gas boilers?

As the ban affects new builds only, it means that the whole heating system will be designed and installed differently from the off-set. The advantage of phasing this in through new houses being built is that alternative systems don’t need to replace in a way that’s compatible with old designs.

Here are some options for alternative heating but not all of these will be used by home builders:

Air source heat pumps (ASHPs) are a type of renewable energy technology that can significantly help in reducing carbon footprints. They operate by extracting heat from the outdoor air and transferring it indoors to provide heating or hot water for buildings. This process is achieved through a cycle of compression and expansion of a refrigerant gas, similar to how a refrigerator works in reverse.

Ground source heat pumps (GSHPs), also known as geothermal heat pumps, are another renewable energy technology. These systems harness the relatively stable heat stored in the ground to provide heating, cooling, and hot water for buildings.

Infrared heating panels are a type of heating technology that operates by emitting infrared radiation, which heats objects and surfaces directly without significantly heating the air in a room. It’s important to note that the carbon footprint reduction achieved by infrared heating panels depends on various factors, including the energy source used to generate electricity, the efficiency of the panels themselves, and how they are used in a specific setting. However, their ability to provide efficient, targeted heating and minimize energy waste makes them a potential tool for reducing energy consumption and, consequently, carbon emissions associated with building heating.

Solar thermal panels, also known as solar water heating systems, are designed to capture sunlight and convert it into usable heat for various applications, such as heating water for domestic use, space heating, and even industrial processes. Their ability to directly convert sunlight into usable heat energy without emissions makes them a valuable tool in the transition to a more sustainable and low-carbon energy future.

Biomass boilers are heating systems that use organic materials, often derived from plant or animal waste, as fuel to produce heat for various applications, such as space heating, water heating, and industrial processes. the overall environmental impact depends on various factors, such as the type of biomass used, the efficiency of the boiler, the sourcing practices, and the management of the fuel supply chain.

Ground source heat pump gas boiler alternative

How a ground source heat pump works:

How close is the industry from meeting the targets?

Estate Agency Today has reported that “In November, research conducted by The Housing Forum’s Futures Network unearthed concern with the potential to meet the requirements set out in the Government’s 2025 Future Homes and Buildings Standards. One in five members surveyed said that their organisation does not have a plan in place that will allow them to deliver homes in line with the 2025 emissions targets, while three in four believed that the industry does not have the necessary skills and knowledge to meet the target within the next 10 years.”

In July of this year, Michael Gove The Housing Secretary, whilst talking about the ban of gas boilers in all new build properties from 2025, said this was ‘one area that I do think that we need to review’.

Mail Online reported Matthew Pratt, Redrow chief executive, as saying that the move would ‘future-proof’ homes, adding: ‘This will provide the opportunity for our customers to reduce their costs and carbon footprint.’

Moving away from the Future Homes Standard and looking to the broader topic of the Governments goal to improve energy performance within UK homes, The Negotiator reported the Chair of the National Infrastructure Commission, Sir John Armitt as saying; “There have been negligible advances in improving the energy efficiency of UK homes, the installation of low carbon heating solutions.”

In the same article referencing the Governments net zero targets, a survey by the British Property Federation and JLL, said that 90% of property sector leaders “do not believe current government policy will deliver a carbon-free property sector in less than 30 years.”

What are the largest fines in residential property?

Agencies and landlords being fined

We’ve all either heard the stories of or even have experience with troublesome tenants, lousy landlords and non-compliant agents, but are the tens-of-millions of pounds in fines handed out last year really down to an increase in these badly behaved few? Or is the increase in fines down to the newly tightened rules around compliance with the effect of well-meaning landlords and agents unknowingly falling short of compliance requirements?

Here we take a look at some of the biggest fines landlords, lettings agents and sales agents could face in 2023. We also hear from some of the industries’ leading voices to see what they have to say, and look at how you as an agent, can avoid inadvertently landing one of these big fines.

High profile, big ticket fines include:

The industry as a whole seems aligned to the spirit of the rules, regulations and requirements, However, there is no doubt that differing opinions exist regarding the specifics and their application.

Non-compliance issue
Possible fine value
AML compliance
£500,000+
Right to Rent compliance
£1,000 – unlimited + up to 5 years in prison
EPC
£5,000
Incorrect or no licensing
£20,000 – unlimited
Safety certification breaches
£30,000

Are the fines proportionate?

Nigel Lewis at Landlord Zone, reported that Ben Beadle, chief executive officer of the NRLA, when speaking about Right to Rent fines where “Repeat breaches will be fined up to £10,000 per lodger and £20,000 per occupier” he said that; “The announcement is little more than a gimmick.” Ben told The Telegraph “that piling pressure on landlords would merely fail to deal with the root cause of immigration and “make it more difficult for poorer British nationals to find housing because they are more likely not to have passports or driving licences they can use to prove their citizenship status”.

Ben Beadle

In July of this year, Graham Norwood at Landlord Today reported on Ben Beadle’s response to the £10,000 cap on improvement works for MEES to be raised for an EPC.

In 2018 a Minimum Energy Efficiency Standard was introduced, requiring all properties to be let to meet an energy efficiency band of E. Any properties within the bands of F or G can not be let and need the landlord to take appropriate action to comply. The cost relating to the landlord’s appropriate action has a financial cap of £3,500 and includes actions such as loft and wall insulation, upgraded boiler, double or triple glazing, etc. Beyond this maximum cost, a landlord can apply for an ‘All improvements made’ exemption and will be awarded the EPC to let the property. The minimum spend cap is being increase from £3,500 to £10,000 before exemptions can be requested.

Ben Beadle advised Lord Callanan, the Energy Efficiency Minister on the “uncertainty and nervousness over the timescales, and their fear that a cap on improvement works at £10,000 per property might create huge bills for those landlords with the most problematic properties.” Adding that “Landlords are not the ‘fat cats’ the media would make us out to be, with almost 70 per cent basic rate taxpayers. However £10,000 also has a different value depending where in the country you and your portfolio are based”

What must be done to avoid fines?

This isn’t an exhaustive list of all potential residential property fines, but we’ve sourced advice from industry voices to look at avoiding some of the larger fines and navigate recent legislation changes to highlight how to stay clear of any unexpected penalties.

 AML – Anti Money Laundering: Advice from the Fintech Times

To mitigate the risk of incurring AML fines in 2023, agents and landlords should:

  • Enhance customer screening measures to streamline onboarding processes through automation and exceed regulatory requirements
  • Implement a transaction monitoring solution that screens in real-time and can be configured according to different risk appetites for various business flows
  • Access real-time global coverage with robust watchlists and sanctions-screening software
  • Provide thorough training to compliance staff on AML requirements, including reporting obligations, sanctions/asset-freezing measures, and conducting adequate SOF and source of wealth (SOW) checks

Right To Rent: Advice from Finch’s Right to Rent article

Landlords and agents are required to check the following during the Right to Rent Check, as per UK law:

  • They must check that all the documents provided are genuine, original, unchanged, and belong to the tenant in a face-to-face meeting or digitally through a digital trust framework.
  • They need to check that the dates on the tenant’s Right to Rent in the UK have not expired.
  • Landlords and agents must ensure photographs are the same across all documents.
  • If the documents presented have different names on them, the landlord or agent must receive supporting documents showing why they’re different.

Non-compliance with Licensing Schemes: Advice from Housing Anywhere

“Failing to obtain the correct licence is one of the common reasons for costly landlord fines. To avoid this fine, visit your local council’s website and research the required licences and permits in your area. Make sure you obtain them before you start renting out your property.”

Licensing has recently become more complex due to different licenses now in some cases, being required for different sides of the same street. It is crucial now, more than ever that the landlords and agents are up-to-date on license requirements in their areas. Two helpful tools we’ve managed to source to help with this are:

Safety Certificate breaches: Advice from Choices.co.uk

Faulty gas appliances can kill. So, naturally, failing to comply with the Gas Safety Regulations is a serious offence. You are breaking the law if you can’t provide an up-to-date gas safety record. The fines for this are unlimited and can also result in a prison sentence.

If you are a landlord without a valid EICR in place, then you are committing an offence. Breaching Electrical Safety regulations can result in fines of up to £30,000.