Upgrading homes would slash billions off customer bills

A large-scale drive to upgrade the UK’s energy inefficient homes would slash billions off customer bills.

Citizens Advice research claims that upgrading 13 million inefficient homes to EPC C by 2030 would save customers £951 per year per household, totalling a combined £23.8 billion.

The group adds that “existing [government] support is inefficient” with most people either unaware of grants available or unable to access to them.

It calls for a greater public and private funding schemes to pay for the upgrades.

“Fuel poverty levels are set to rise, with energy bills likely to remain high despite recent price fluctuations,” Citizens Advice report adds. “By improving efficiency, homes are warmer and bills are lower, helping people avoid fuel poverty – particularly in regions with the leakiest homes.”

It adds: “The average cost of increasing a home’s energy efficiency to EPC C is £3,800. Like any large-scale infrastructure project, achieving this will require a range of financial levers from Government funding, subsidies and private finance.

“We need careful planning to meet this challenge including inputs from initiatives such as the Energy Efficiency Taskforce, and taking on learnings from other countries that have successfully rolled out large scale schemes that help people upgrade their homes.”

As well as reducing customer bills, Citizens Advice says that upgrading the UK’s housing stock would reduce energy demand during peak times.

It claims that better insulated homes would reduce national and peak electricity demand by 8%.

It adds: “As well as directly saving consumers money on their bills, lower energy use also reduces demand on energy networks. Energy network costs usually represent between 5%-20% of domestic energy consumers’ bills.”

The report adds that putting less strain on energy networks lowers the cost of producing and distributing energy by:

• Reducing the need for costly infrastructure upgrades to reinforce the network and allow it to meet energy demand.
• Improving the stability of the energy grid, meaning less money needs to be spent on balancing the energy supply to match consumer demand.
• Reducing the cost of operating the gas system.

The group also champions the effect upgrading homes would have on achieving net zero goals. It adds: “Improving energy efficiency stops heat leaking out into the atmosphere, meaning people have to use less energy to heat their homes to the same level.”

The report concludes that £9.3 billion could be achieved in societal savings including lower CO2 emissions and avoided excess winter deaths.

Citizens Advice adds that upgrades would save the NHS £2 billion due to lower treatment costs. This is because warmer homes would reduce the cases and severity of illnesses associated with cold homes.

Dame Clare Moriarty, chief executive of Citizens Advice, said: “The impact of raising minimum energy standards would be profound: giving a boost to household budgets, improving people’s health, increasing energy security and helping the UK reach its net zero targets.

“This report shows that insulating our homes is about so much more than reducing energy bills. It’s a long-term solution that makes running the NHS cheaper and boosts quality of life in areas that need it most.

”The government must make improving our draughty homes a top priority.”

The Association for Decentralised Energy (ADE) recently called for all homeowners to be forced to meet minimum energy efficiency standards before they were able to sell their homes, in a bid to upgrade the UK’s housing stock.

Affordability is one of the themes at Utility Week Forum this October. To find out more click here.