Scotland's housing providers have been adding up the cost of providing energy certificates for homes as demanded by the EU Energy Performance in Buildings Directive and questioning whether the results will justify the final bill.

The need to implement the EU's Energy Performance in Buildings Directive (EPBD) has been focussing minds across the housing sector, with the devolved administrations working towards their own solutions rather than adopting Defra's response for England and Wales.

The central plank of the directive is that all buildings will have to have an energy performance certificate (EPC) whenever they are sold or subject to a new lease or letting arrangement, with the aim of making occupiers more aware of energy costs and their own environmental impact.

The clock is ticking as EU member states were supposed to start implementing the directive from January this year and are allowed no more than three years to comply in full. In the UK, as in other member states, the absence of a pool of trained inspectors who are accredited for the preparation of EPCs is regarded as the main cause of delay.

Scotland is currently consulting on its arrangements, having proposed a timetable of May 2007 for post-construction EPCs for new buildings, early 2008 for EPCs at the point of sale, and January 2009 for EPCs to be offered whenever a new rental or lease is entered into.

But there is work still to be done on a whole range of technical issues, including the format of the EPC itself, establishing criteria for the training of inspectors and arrangements with organisations that will offer accredited training, and the question of what to do with all the data that is collected.

And, of course, there is the cost, with housing associations and local authorities bracing themselves for the additional cost of preparing an EPC every time a home is to be sold or let.

Ian Walker, chair of the EEPH's Scottish Managed Housing Group, says landlords have only recently woken up to the cost implications of producing EPC's following Scotland's decision to require inspections at individual property level, rather than through desk-based stock assessments.

"The rented sector's main concern is with the cost and who will provide the funding for the additional work," says Walker. "But the biggest flaw is that the demands of the EPBD are all to do with conveying information and will not serve as a trigger for action."

Fuel poverty charity Energy Action Scotland shares Walker's view that the EU's costly means of raising awareness will not in itself do anything to improve energy performance. "Our primary concern is that the current proposals do not link EPCs to any other policy instruments, or to any of the reporting structures that are already in place and established among local housing providers," an EAS spokesman told EEPH.

Current proposals are for energy performance ratings along similar lines to those familiar to consumers buying electrical white goods, and possibly a figure for carbon emission per square metre. But how meaningful is that likely to be to the typical fuel-poor tenant?

Energy Action Scotland wants to see EPC's that give simple running costs in terms of likely fuel bills for the property in a format that would allow the effects of improvements to be readily understood by non-experts. It is therefore calling for whole house energy rating, rather than ratings for space and water heating as proposed. It also points out that Scotland's colder climate will mean that EPCs will make Scottish homes appear less efficient than identical properties elsewhere in the UK.

In Scotland, having a legislative framework in place to accommodate the demands of the EPBD is proving the easy part. The directive will be implemented by the Scottish Building Standards Agency (SBSA) of behalf of the Scottish Executive. A new building standards system was introduced in Scotland last year in the wake of the Building (Scotland) Act 2003. The setting of energy standards and energy certification will therefore build on a system that will already exist in Scotland.

Changes to Scottish Building Regulations aimed at raising energy standards were issued for consultation earlier this year and a report is expected from the Scottish Executive in August (more information on the proposed changes is available here.)

The exceptions, for which new statutory provisions will have to be made, are the EPBD requirements for regular inspection of air conditioning systems and the provision of advice on the efficiency of boilers (Scotland and the rest of the UK are choosing to provide advice, rather than require boiler inspections, an option allowed by the EPBD).

EPCs for new homes

Scotland's target date of May 2007 for EPCs for newly-constructed homes aligns with the introduction of revised energy performance standards and guidance already in the pipeline in the form of amended building regulations. The Scottish construction industry has been digesting changes issued for consultation since March this year; revisions revolve around a shift to whole building assessments (for dwellings and non-dwellings), rather than minimum standards for building elements, using a methodology that will satisfy the EPBD.

The calculation tool to be used for dwellings will be SAP 2005, a rating system that has already been released and which can be used to generate the indicators needed for energy performance certificates.

EPCs for existing houses for sale

Early 2008 for EPCs for homes for sale has been chosen to align with the introduction of the proposed 'Single Survey', which will have to be prepared for all homes going on the market.

With an anticipated 100,000 homes per year expected to need a Single Survey, the case for coordinating this with the EPBD demand is overwhelming. Indeed the EPC will become an integral part of the Single Survey in much the same way that energy ratings will form part of the Home Information Packs that will become mandatory for homes going on the market in England and Wales from June next year.

However the Single Survey itself is still in development and ministers have yet to announce exactly who will be able to carry them out.

Scotland has decided to ally itself closer to Northern Ireland than England and Wales, with both opting for a single-page EPC format that will be shorter than the multi-page draft recently unveiled for England and Wales.

The arguments runs that the 2008 timetable will give the system a chance to bed down and ease local authorities into the routine of providing EPC's ahead of the requirement for rented housing the following year.

Less detail is required for the preparation of EPCs for existing homes, so the front-running proposal is a reduced data version of SAP 2005 (RDSAP) which should not require an intrusive property survey.

EPCs for housing for rent

Although January 2009 is still some way off, local authorities and housing associations have been worrying about the additional cost of producing EPCs and who will foot the bill. Cost projections have been varying significantly. At a seminar on the EPBD in Glasgow in June, the Scottish Federation of Housing Associations warned of independent assessor costs of up to £150-200 per property. Other commentators have suggested that EPCs produced by suitably trained in-house staff could bring costs down to a little as £10 per dwelling.

Local authorities and other social housing landlords already have an obligation to monitor the energy performance of their housing stock under the Scottish Housing Quality Standard (SHQS). These can be SAP or NHER ratings produced by suitably-qualified inspectors, whether bought-in or in-house. Compliance with SHQS is already a prerequisite for social housing funding.

It is hoped that these existing ratings, if not too old, could be readily converted to produce ratings that satisfy the EPBD without the need for re-surveying, so discussions on this front have been revolving around the scope for continuity.

Further complicating the picture is the prospect of a Scottish Energy Rating Tool (SERT), which had already been commissioned and is still in development as a rating tool for existing dwellings. Housing associations trialling SERT had found it relatively user friendly and so regard the likely adoption of the more demanding RDSAP as a setback.

The SBSA's position on SERT is that development work should continue, keeping open the option of its use at some later date if it proves to be robust. As an unproven tooI, SERT is not therefore at the top of the SBSA's agenda as it tries to reach consensus on EPBD implementation.

The training question

Training arrangements are still emerging. The plan is that the SBSA will enter into training protocols with organisations able to support training in procedures demanded by the EPBD, although to date the SBSA's discussions have been limited to the Chartered Institute of Building Services Engineers (CIBSE).

What to do with the information?

While the EPBD does not require it, the collection of the data generated by EPC activities is being advocated by a number of agencies, not least the Energy Saving Trust. Failure to collate the data, which over time could create a comprehensive snapshot of the energy performance of Scotland's housing stock, would be regarded as a missed opportunity.

There are a number of options under consideration, particularly as the absence of a central register of EPCs would not allow simple verification of whether an EPC had been issued for an individual property.

One option would be to extend the Building Standards Register that is already maintained by local authorities to keep track of the issuing of building warrants, notices etc. Such a register could give ministers direct control of the register, which could also be made publicly accessible on the Internet.

There are public sector cost issues here, of course, but these disappear if the task of maintaining the register is taken on by non-public body.

Step forward the Energy Saving Trust, which last year launched its own Home Energy Efficiency Database (HEED) with the aim of building up a picture of the energy performance of dwellings across the country. The EST has offered to gather the input data from the preparation of EPCs, which suits this purpose very well, with the added dividend being that a record of the date on which data was logged would service as a proxy register of all EPCs in circulation.

However, HEED will not be publicly accessible. Instead there would be different levels of access for ministers, energy suppliers and local authorities.

The Trust's case is strengthened by the fact that it is already working as a partner organisation with SBSA for the implementation of another element of the EPBD, the provision of advice to all of Scotland's householders on the efficiency of their boilers. Should HEED be used to implement both articles of the EPBD, the need for only one database clearly offers efficiency gains.

No decision has yet been taken. The SBSA's stated reservation on HEED is that because it is exploring the register option as an alternative (permitted by the EPBD) to the mandatory display of EPCs in existing buildings, it feels it should be able to fall back on a public sector-maintained register to justify the legislative opt-out.

The SBSA's consultation paper on implementing the EPBD can be viewed here.