Homeowners shun energy saving improvements due to cost of living

Homeowners are putting the brakes on making their properties more energy efficient because of cost-of-living pressures, according to new research.

According to research from NatWest and S&P Global, more than a quarter of homeowners (26%) say they are less likely to make energy-saving improvements over the next 12 months, such as installing insulation or upgrading their heating system.

According to the Institute for Public Policy Research, the average household could save £500 a year on bills with good insulation and heat pumps.

However, the high initial cost of the work required is by far the biggest barrier to implementing green home improvements.

Of those homeowners who had no plans to make changes to their property in the next 10 years, 71 percent said cost was the main reason.

Internal wall insulation costs around £8,200 for the average three-bedroom home, and double glazing typically costs between £4,250 and £15,000, according to the Energy Saving Trust.

Floor insulation and exterior wall insulation can also be very expensive. The cost of exterior wall insulation is usually around £100 per square metre, according to Checkatrade, with the average cost ranging from £8,000 for a small flat to £22,000 for a large detached house.

Average floor insulation starts at £770 for a smaller room and up to £1,000 for larger rooms.

However, it can be easy to forget that there may be additional costs involved, such as new carpeting or new carpeting.

It is estimated that a quarter of heat loss from poorly insulated homes is through roofs, a third through exterior walls, a quarter through doors and windows, and the rest through floors

Those looking to insulate over solid concrete floors would have to pay between £950 and £2,200 per room, according to Checkatrade.

With insulation under a floating wood floor, you can expect to pay much less – usually between £300 and £750 per room.

Perhaps unsurprisingly, seven in 10 homeowners said they had no plans to make any changes to their property in the next 10 years.

Households are trying to reduce energy consumption

Instead of retrofitting their properties, homeowners say they are reducing their energy use instead.

Almost two-thirds of households are trying to minimize energy consumption at home, compared to 59 percent a year earlier.

Homeowners are increasingly trying to cut costs on household appliances such as tumble dryers and dishwashers, which are among the most energy-consuming appliances in the household.

NatWest’s research showed that the most common energy habit people take action on is not to overfill the kettle, which almost half of the households surveyed said they do.

Nearly half reported turning down the heating, with some even going so far as to turn off the radiators altogether. These actions were generally more common in older age groups.

Other common measures included turning off appliances when not in use, using appliances less often, and reducing the use of lighting.

>> Green dryers pay for themselves in two years! They are often demonized for consuming power, but new energy-efficient models could change that

Better EPC ratings can help sell a home

While homeowners are less likely to try to make their homes greener, those looking to buy a home say that the energy performance certificate rating – the most important measure of a home’s efficiency – is more important than ever.

The EPC is a classification scheme that classifies properties between A and G, with an A rating being the most energy efficient and G being the least efficient. The most common EPC rating for homes in the UK is a D.

According to NatWest, the energy efficiency of a property is now a higher priority than other factors, such as the amount of local greenery and access to public transport.

Easy as EPC: More than one in five potential home buyers said an EPC rating of C or higher was an essential feature when choosing a property to buy

It found that one in five potential homebuyers said an EPC rating of C or higher was an essential attribute.

This may be a result of the UK Government’s target for all existing homes to achieve an EPC rating of Class C or higher by 2035, as well as improved energy efficiency, meaning lower bills.

Lloyd Cochrane, Head of Mortgages at NatWest said: ‘While people care about EPC ratings and individual energy efficiency measures, there are still barriers when it comes to taking steps to retrofit their homes.

“We know that homeowners are eager to make changes that save money and combat climate change, but the cost of making these changes remains a barrier for homeowners.

“As supply chain issues are also increasingly a bottleneck to decarbonising our homes, it is critical that we support customers financially so that they are not dissuaded from driving demand for energy-efficient products and services.”

What energy premiums are there for homeowners?

While there are schemes available to help homeowners green their properties, most will still have to pay the bulk of the upfront costs themselves.

The government says it is investing £12bn in ‘Help to Heat’ programs to ensure homes are warmer and cheaper to heat.

This includes the Boiler upgrade schemethe Municipal Delivery Scheme, Subsidy Upgrading Home and the Energy Company Obligation.

The financing does not come directly from the government, but via installers, municipalities, energy companies and other bodies.

For example, the Boiler Upgrade Scheme gives grants to homeowners to install low-carbon heating systems such as heat pumps.

It essentially offers to save £5,000 on the cost of installing an air source heat pump or biomass boiler and £6,000 on the cost of installing a ground source heat pump.

For many people, however, it won’t be enough to entice them to upgrade.

This is because the supply and installation of an air source heat pump can cost up to £18,000, according to Checkatrade.

Meanwhile, an installation of a ground source heat pump for a typical home will cost between £13,000 and £35,000 on average.

Going to the ground: With a ground source heat pump, the heat energy is collected from water circulating in underground pipes, which is pumped to a heat exchanger in the house

The scheme is only open to people in England and Wales. To qualify, homeowners must have installed or plan to install a new heating system on or after April 1, 2022.

They also have to replace fossil heating systems such as oil, gas or electricity.

The property must also have a valid EPC rating, with no outstanding attic or cavity wall insulation recommendations. In other words, the building must already be relatively well insulated.

To apply, homeowners must choose one MCS certified installer who in turn must confirm their eligibility for the scheme.

The installer will apply on behalf of the homeowner on the Ofgem website and the value of the grant will be deducted from the amount they subsequently pay for the installation.