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Housing Minister Grant Shapps today published an improved green rating for new homes that will help deliver the next generation of green properties, which are built to the highest standards of sustainable design, and could reduce future utility bills by up to £2,250 a year in the most energy efficient homes.

The Code for Sustainable Homes was introduced in April 2007 as a standard to improve the overall sustainability of new homes. The Code scores against a star rating system, using one to six stars depending on how the property performs against categories such as energy use, waste, materials and water.

Mr Shapps said the Code has been updated to take into account the tougher new rules for energy efficiency in buildings, and help developers make new homes greener without getting bogged down in unnecessary 'gold plated' design features.

The Code, which has been updated after an extensive consultation with housebuilders and industry experts, will also make it easier for consumers and homeowners who want to grade the standard of their properties.

Grant Shapps said:

"Over a quarter of the country's carbon emissions come from our homes, and if we're serious about tackling climate change we need to reduce this. So I welcome these changes to the Code that bring it in line with the tough new rules for energy efficiency in the Building Regulations.

"We need greener homes, but I also want to make it easier to build the homes this country needs. Good building standards can only be effective if they are easy to understand, and only applied where they are appropriate. That's why the Code has been updated to iron out problems that have arisen over time, and streamlined so building standards can be used in a sensible way that suits the local situation.

"It's important house builders meet the standards local communities demand, but I'm determined to simplify the complicated processes they have to go through to achieve this. That's why I've pledged to tackle the 'alphabet soup' of standards and red tape that blight efforts to start new developments, and I will be working with industry to get this done."

The Code is rated from one to six, one being the entry level - above the level of the standard, mandatory Building Regulations - and six as highest, reflecting outstanding sustainable development.

In the first three years, nearly 8,000 homes have been completed to Code level standards. Ministers believe this figure is too low, partly because the current Code is too complicated and bureaucratic. The updated version will be a first step towards making it is easier for developers to deliver more green homes. The new Code's green rating system has been improved by:

• Aligning the Code with the latest developments in building regulations - it will now take into account, and in some cases go beyond, the tougher new Building Regulations to reduce carbon emissions from buildings. For example, a Code level 4 home will now be 25 per cent above this minimum standard. The new Code will also strongly incentivise the introduction of 'fabric energy efficiency standards', so developers can use building materials and techniques that improve the energy efficiency of new homes.
• Streamlining the Code and associated processes - to ensure that the Code is focused on the issues of greatest significance, instead of including unnecessary standards that duplicate existing regulations or create difficulties for developers. For example, there is now an exemption from the 'lifetime homes' standards for sites where it is too steep to apply, and the mandatory requirement for site waste management plans has been removed since it is required by other regulations.
• Resolving problems that have arisen in use of the Code - for example, clarifying parts of the Code that set standards for reducing the risk of flooding. Clear surface water management standards have now been set, enabling developers to understand exactly what is required.

The new Code will have key role in helping people cut their carbon emissions and lead more sustainable lifestyles. The standards reflect the future goals for zero carbon homes and include measures for reducing energy consumption, minimising and recycling waste, reducing potable water demand, reducing the risk and impact of flooding, reducing carbon intensive travel by providing cycle storage as well as promoting facilities for working at home. It encourages a reduction in energy through the choice of building materials as well as the energy used during the construction.

Notes to editors

1. The Code is a voluntary standard with flexibility for developers to determine the most cost-effective mix of issues to cover to achieve any particular level, subject to a limited number of mandatory requirements to secure particular Code levels. However, it is also used as a condition by local authorities when they want to set sustainability-based planning conditions on housing developments in their area. However, before setting such a condition, planning guidance (PPS1 Supplementary Guide) currently requires authorities to undertake a full viability assessment setting out the costs to industry, and the benefits. The new Code and technical guide can be found at: www.communities.gov.uk/publications/planningandbuilding/codeguidesummary2010.

2. Compared to the current version of the Code, the changes being introduced today could result in an overall net present value benefit to the UK economy of nearly £110m. Full details are available in the Impact Assessment which is also being published today at: www.communities.gov.uk/publications/planningandbuilding/codeimpactassessment2010.

3. A major potential saving for developers has been made by making requirements over rainwater management more sensitive, which was proposed by many developers. This, in conjunction with other measures, could reduce the cost of constructing Code homes by up to £50m, depending on the location.

4. Average savings for householders on utility bills are set out below. In 2010, taking into account feed in tariffs, households built to Code level 6 could save between £1250 for a flat and up to £2250 for a detached house in energy and water bills.

Annual Fuel bill and feed-in tariff revenue relative to a Part L compliant home in 2010

5. Practical experience of working with the Code is also informing the development of other aspects of sustainability policy. For example the development of surface water management proposals in the current Floods and Water Management Bill.

6. The Government is committed to reduce the burden of regulation, and to reducing duplication. Future plans to review the future role of the Code are currently being considered, alongside a wider rationalisation of housing standards.

7. The rating standards in the Code are assessed against nine categories:

• Pollution
• Heath and Wellbeing
• Management
• Ecology
• Energy and CO2 Emissions
• Water
• Materials
• Surface Water Run-off
• Waste

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