Given the economic outlook, the net zero agenda might feel a lot lower down the priority list than dealing with the immediate cost of living crisis.

It might seem that way at first glance, but in fact so much of the financial crisis households face currently is intrinsically interwoven into the energy system – itself a core element of delivering net zero.

Let us not forget that the UK’s carbon reduction targets are enshrined in law and every government we’ve had under Theresa May, Boris Johnson, Liz Truss and now Rishi Sunak has underlined their commitment to delivering on net zero.

The Chancellor Jeremy Hunt’s Autumn Statement put energy at the very centre of this government’s agenda – announcing massive investment in renewable energy infrastructure, offshore wind, carbon capture among many other initiatives.

That commitment is part of the country’s drive towards net zero but it is just one element. Becoming less reliant on fossil fuels is not only a case of largescale infrastructure investment; improving the energy efficiency of UK households is also an enormous task which cannot be overestimated.

Replacing gas boilers and heating systems with heat pumps and other electricity-based systems is going to be expensive and require highly skilled workers to achieve.

In spite of Hunt’s November commitment of a further £6billion to be spent on insulating the UK’s ageing housing stock, that is going to be a challenge on more than one front.

There are targets for the private rented sector, requiring minimum EPC band ratings of C and above by 2025 for new tenancies.

Getting to that level is going to take significant sums invested by private landlords – we are already seeing many of them sell up and move out of the market because the commercials no longer add up. And that’s before higher mortgage rates are factored into the buy-to-let market.

Along with higher taxes, higher energy bills, higher food costs, higher inflation and higher mortgage costs facing British households in the coming year, homeowners’ financial ability and appetite to upgrade their homes looks seriously depleted.

And then there’s the practical side. UK Finance noted in a recent report that the current skills shortage is already presenting a barrier to the sector.

The Committee on Climate Change estimates that an additional 200,000 workers will be required to meet the UK’s 2050 target. But in its Q2 2022 survey, the Federation of Master Builders reported that 61 per cent of members had delayed jobs due to a shortage of skilled tradespeople in that quarter.

UK Finance warned that, consequently, there is likely to be an increase in the number of rogue tradespeople offering retrofitting services. That raises questions about quality and further complicates property condition valuations.

That this will have consequences for property values, particularly as net zero targets get nearer, is fast becoming a tangible challenge for lenders.

“As public awareness of energy efficiency increases (e.g. driven by minimum EPC standards), instances may arise in which properties are devalued if homeowners are unable to afford to retrofit the house,” UK Finance admitted.

We know net zero is the destination and there is a broad sense of the journey we must take to get there. Now we need to quantify the size of task and it will take innovative forward thinking and close partnerships between lenders and surveyors with support from the right partners to get that right.

Mark Blackwell