Which political party comes out on top in terms of the environment? Here’s our view

As the political parties strive to gain our attention, we need clarity around environmental and sustainability policies. Many organisations in the real estate sector are ready and willing to work towards creating an industry with a lower carbon footprint and to help societies achieve the same goal. But unless we know what the government’s priorities are, and the financial implications, that task is difficult.

While the political parties like to call each other out on their different policies and approaches, they all have one thing in common: a lack of detail. They may announce impressive targets, but there is rarely a concrete plan to reach them. This is despite the fact Labour’s biggest spending commitment is £23.7 billion for green measures during the next parliament.

As a result, there is a danger that environmental agendas will be pushed aside in favour of more headline-catching policies. We’ve seen a lot of backlash in the US on ESG and sustainability, which some politicians are labelling as too ‘woke’, rather than a real and pressing issue. We do not want Europe to fall into the same trap.

Already, Rishi Sunak’s warning of pursuing “unaffordable eco-zealotry” suggests he is throwing doubt on the need to increase the UK’s efforts to reach legal targets. This is despite the Climate Change Committee’s warning that the UK is not on track to cut greenhouse gas emissions by 68% by 2030, as laid out in the Paris Agreement.

To encourage the real estate sector to prioritise sustainability, the government needs to play its part. It takes Capex to improve a property; an investor needs to know they will see returns. We all know more stringent regulations are coming, such as mandatory disclosures, which pose legislative risks. But without knowing exactly how the regulatory landscape is moving it is hard to determine what those risks are.

As we get closer to the General Election on 4th July, our hope is that more definitive plans are published, to end uncertainty for the property sector. In the meantime, we have detailed some of the green policies of the main two parties below.

Cutting carbon emissions

While the Labour and Conservative parties like to do battle over each other’s net zero plans, they don’t appear highly dissimilar. Labour says it will decarbonise the grid by 2030, while the Conservatives say they will ensure 95% of energy is low carbon by the same year, with full decarbonisation by 2035.

In terms of concrete plans, there is little detail available. The Conservative party has a Carbon Budget Delivery Plan, but this has been declared unlawful. The Lib Dems and The Green Party have bold net zero ambitions, but they also lack real information.

Labour still plans to invest in existing oil and gas schemes, though it won’t approve any new projects. In contrast, the Conservatives will continue to approve new projects.

The growth of green energy

Labour is focusing much of its overall green stance on energy plans and its pleasing that this is a major point in its manifesto. The party has committed to spend £1.7 billion a year creating Great British Energy, a publicly owned green energy company.

Currently, onshore wind is being largely blocked by policy and planning and there is little to suggest the Conservatives would loosen the system. Labour plans to double onshore wind capacity, while quadrupling offshore wind and tripling solar power. Other plans revolve around nuclear projects and other sources of power such as green hydrogen. The Lib Dems will accelerate the deployment of wind and solar power so 90% of electricity is generated by renewables by 2030.

More bold policies around installation of solar PV systems in urban environments would certainly benefit the real estate industry. However, only the Green Party has explicitly addressed the installation of solar panels on car parks in several of their local manifestos. For example, they advocate for the installation of solar canopies in council car parks to promote renewable energy and reduce carbon emissions. At LSH we are working with clients to install PV systems across industrial, retail and offices and their carports.

Retrofitting homes

At 38%, the UK has the largest proportion of pre-war homes than any other European country. Over the last few years, the government has attempted various measures to tackle the energy efficiency of homes, such as the Green Homes Grant, but their implementation has faced criticism for inefficiency.

Labour aims to deliver a Warm Homes Plan to upgrade homes using measures such as loft insulation, committing £6.6 billion during the next parliament. However, this plan was impacted by the cuts to Labour’s previous £28 billion green investment strategy back in February. Funding for the Warm Homes Plan went from £60 billion to upgrade 19 million homes over ten years to £13.2 billion for five million over five years.

The urban environment

Buildings’ energy efficiency aside, a huge aspect of the urban environment is transport. In September, Rishi Sunak pushed the target to stop selling combustion engine vehicles from 2030 to 2035; Labour says it will reinstate the 2030 goal.

But where’s the infrastructure to support that? Currently we’re in limbo, with electric vehicles promoted but we are nowhere closer to solving the major pollution and transport emissions problems related to urban environments. The only incentives that currently exist to purchase electric vehicles are for businesses. While Labour has plans to improve green transport, the financial support is unclear.

The Conservatives say they will allow communities to vote on low emission zones - and will scrap the extension of London’s ultra-low emission zone. In 2023, Labour dropped its commitment to setting up clear-air zones across the country, and little has been said since.

Nature

The government is not going nearly far enough to support nature and biodiversity. However, Labour has pledged to protect at least 30% of the UK’s land and sea if elected, in line with the commitment made by the government in 2020. Currently, just 3.22% of land in England and 8% of the sea is protected, according to a report from Wildlife and Countryside Link.

The recent introduction of biodiversity net gain targets was a move from the current government in the right direction, but it does not go far enough. Any new development must make the natural environment a key concern.

Planning policy

Labour is very clear that if elected, the party will reform the planning system. However, this is a mammoth task and the party has given no detail about where it will start. Amid the reform, the hope is that environmental issues will be better integrated into planning policies.

Back on renewable energy, Labour says it will introduce tough targets for consenting decisions for renewable projects. The party will guarantee decisions don’t sit unread for months.