Development projects in London are poised to become more expensive to deliver and carry more technical risk should the proposals in a new GLA consultation be adopted.
On 22nd June the GLA brought to a close their consultation on the Housing Standards Minor Alterations to the London Plan (MALP) that effectively removes the Code for Sustainable Homes (CSH) references for new projects in London and provides a worrying update on how development will be tasked to meet future emissions standards.
The consultation has serious implications for:
- New non-domestic development projects brought forward in a planning application from 2016, due to a tougher emissions target that 6 out of 7 projects in the supporting evidence study cannot achieve; and,
- The cost to development to obtain Allowable Solutions to meet zero carbon targets, thanks to a new Allowable Solutions hierarchy.
In context, the MALP consultation can be seen as the GLA’s response to the Housing Standards Review (HSR) undertaken by the DCLG. The HSR was completed early in 2015 to simplify policies, regulations and standards for housebuilders, providing them with less red tape while hoping to deliver similar quality homes to meet housebuilding targets. A major part of the restructuring heralded by the HSR was the scrapping of the CSH with its replacement by as yet unpublished set of National Technical Standards.
One of the main HSR proposals was to remove from local authorities the ability to set housing standards beyond Building Regulations. For the GLA, who were gearing up to levy a ‘Carbon Tax’ on development that didn’t meet their targets, this was a considerable disappointment! Unfortunately for developers in London the MALP consultation proposes tougher non-domestic targets from 2016 (a 50% emissions reduction from 2016-2019 compared to just meeting Building Regulations) as well as proposals on how Allowable Solutions, or the ‘Carbon Tax’ for development is applied to London projects.
Using a recent example and the GLA recommended carbon abatement cost this would result in a 3,500sqm commercial development being required to pay at least £79,000. A further complication and likely added cost is implied by the Allowable Solutions hierarchy which requires abatement to take place, if not on-site, then within the LB of development or at least in the wider GLA area. Given the scale of development in London this could mean that Carbon Tax costs in London are subject to extreme market forces.
Should developers wish to avoid a volatile marketplace for Allowable Solutions they could require their designers to add all available carbon reducing technologies into their development. Adding greater numbers of novel building features onto projects will increase the risk of poor building performance in use – by the simple factor of there being more opportunities for things to go wrong. Even adopting this approach and having a building connected to a best-in-class heat network doesn’t meet the targeted 50% reduction for all but one building in the evidence base to the consultation.
We recommend that all developers and construction professionals assess their project pipeline for the projects which will be sensitive to the proposed changes. The Housing Standards MALP consultation page includes a section on how to respond to the GLA’s proposals.