SME housebuilders could fold if new carbon emission rules happen
A new bill forcing builders to assess the carbon emissions of a new project prior to construction will force SMEs out of business, the industry has warned.
Conservative MP Duncan Baker’s private members bill would require them to measure, report and reduce a scheme’s carbon emissions during the design process.
SME construction firm Hofton & Son, based in Nottinghamshire, has said if the bill is passed on its second reading on 18 March then it will stop building homes.
Managing director Mark Shouler said: “It’s going to bring SMEs to a grinding halt. This will add enormous costs. We are just about keeping our heads above the water.”
He has calculated that a small development of 12 homes on a 1.2-acre site estimated to make £650,000 profit would incur a £1m loss if the rules on whole-life carbon emission come into force.
The proposals come at a time of great change for the sector with biodiversity net gain rules happening in November and future homes standards on energy efficiency going live in 2025.
SMEs at risk because they sell direct to the homebuyer
The National Federation of Builders, NFB, said members of its housebuilding association hadn’t been consulted. The trade body said SMEs were more at risk because they build properties they have to sell whereas large construction firms are commissioned.
NFB housing and planning policy head Rico Wojtulewicz said: “It’s easier to meet these requirements if you have embraced off-site and modular building which SMEs haven’t done yet.”
He added building material manufacturers should be encouraged to produce more renewable products as there were insufficient supplies of green materials such as cross-laminated timber.
If Mr Baker’s bill is passed the new part Z regulations would be adopted for commercial properties by January next year, for residential by 2025 and for all buildings by 2027.
Construction giants Cundall, Mott MacDonald and Wilmot Dixon are among the housebuilders supporting part Z as well as professional bodies such as the Royal Institute of British Architects.
The regulations will apply to projects of more than ten homes with a gross internal area of 1000 metres squared.
Property finance intermediary Hank Zarihs Associates said development finance lenders regarded SMEs as vital for training apprentices and offering variety and high housebuilding standards.
