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NEWCASTLEUPONTYNE PROPERTY OPINION

Tuesday August 27 2019

Could LPG help the housing crisis?



Johnny H

JOHNNY H | Researcher




Could LPG help the housing crisis?

The UK’s housing ‘crisis’ regularly crops up in the news, but it’s not all negative.

Here, Flogas, who provide gas for business and domestic use, look at the use of LPG and how it is aiding the creation of affordable housing.

The UK and the problem of affordable housing

It’s no secret that the UK’s housing crisis remains a top issue. A government initiative to build 200,000 discounted homes to first-time buyers had not produced a single home by the end of 2017, according to a report by the Independent. Similarly, approximately 12% of chartered surveyors doubt that the government will be able to achieve its 300,000-new-homes-a-year target in 2018, with even Parliamentary Affairs Manager of the Royal Institution of Chartered Surveyors (RICS), Lewis Johnston, stating that it was “clear more radical action is needed.”

The issue isn’t just with the number of houses available, but the affordability of those houses. In a bid to boost availability, the government has claimed that councils which don’t build enough new homes will lose the right to determine the location of subsequent new houses. This ruling is part of a planning policy framework which details regulations regarding the number of homes that each council must construct — which considers localised aspects of an area including local house costs and average wages. Essentially, if a location has a particularly high level of unaffordability, that council will need to build a greater number of new, affordable homes.

Will this force councils to build upon rural areas? Perhaps. Former Housing Secretary and current Home Secretary, Sajid Javid, revealed plans in March to create several new towns between Oxford and Cambridge. He commented: "Along that corridor, there's an opportunity to build at least four or five garden towns and villages with thousands of homes."

Garden villages are an attractive option. According to the Town and Country Planning Association (TCPA), garden villages are ideally constructed away from established settlements and created on a basis of industry and jobs, with an aim to create diverse, well-designed and affordable homes.

Although this project is a potential solution to more affordable housing, the issue of powering and maintaining garden towns and villages in rural locations is a point that needs consideration.

The role of LPG energy

Around four million homes in the UK are off-grid. According to the Non Gas Map, which was created in collaboration with the Department for Business, Energy and Industrial Strategy; the reliance on the mains grid varies significantly across the UK. Certain locations — such as northern Scotland and central Wales — appear to show less dependence on being connected to the main network, while others, including north-east England and the Home Counties, have a greater percentage of homes that rely on energy provided by mains gas.

The need to build of rural areas brings concerns of power during production and for the intended homeowners. However, the data above shows that there is an opportunity to construct homes in areas that aren’t connected to the mains network, granted that an equally efficient alternative is implemented in its place. But how will this encourage affordable housing growth?

LPG suppliers can help with this issue. Currently, a small number of major commercial developers create the majority of the UK’s housing. By using LPG as an easy alternative to main network connection, we can widen the number of locations that a housing project can take place. Consequently, more small- and mid-size companies should have a greater chance of securing a plot for development in the sector and we may see a growth in affordable housing as a result.

LPG has so many benefits in terms of aiding affordable housing development. One of which is the fact that gas bottles, cylinders and tanks make LPG easy to transport and simple to store during the construction process. Keeping production costs as low as possible is essential to all businesses — no firm wants to go over budget. However, the ease of supplying and stockpiling LPG may help developers keep a track of energy costs and ensure that mains grid issues, such as power cuts, won’t affect productivity — another potentially costly side-effect.

Plus, the nation is pushing towards a greener future. In an industry like construction and housing, it’s easy to adopt less environmentally friendly products and practices. However, the demand to bring these down will only grow as the government strives to achieve its target of lowering carbon emissions by at least 80% of 1990 levels by 2050 — and not doing so may cost companies in the form of taxes and penalties. Fortunately, LPG is a relatively clean form of energy, releasing just 81% of the carbon dioxide that oil does and 70% of the carbon dioxide that coals emits. With tax relief offered to energy-efficient businesses, it’s helpful to be as eco-friendly as possible. If developers of affordable housing choose to utilise LPG, this could also work towards greater numbers of affordable housing projects.   

Affordable housing developers should certainly consider LPG energy. With demand increasing and only a few practical initiatives to ease the strain, such as garden villages, it seems as if they sector needs all the help it can get.

Sources:

https://www.independent.co.uk/news/uk/politics/housing-starter-homes-budget-philip-hammond-a8066571.html

https://www.bbc.co.uk/news/uk-43275611

https://www.ft.com/content/7fe5b936-1f9c-11e8-a895-1ba1f72c2c11

https://www.tcpa.org.uk/understanding-garden-villages

https://www.nibe.co.uk/news/news-2017/heat-pumps-should-be-the-preferred-solution-for-new-build-off-grid/

https://www.nongasmap.org.uk/

https://www.northernenergy.co.uk/advantages-of-using-lpg-over-other-fuels/

https://www.gov.uk/government/publications/2010-to-2015-government-policy-greenhouse-gas-emissions/2010-to-2015-government-policy-greenhouse-gas-emissions

https://www.gov.uk/green-taxes-and-reliefs



"Along that corridor, there's an opportunity to build at least four or five garden towns and villages with thousands of homes."
Sajid Javid








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