How to fix 30m draughty homes
And help Britain reach net-zero emissions
At first glance 47 Greenleaf Road in Walthamstow, a suburb of London, looks like any other house in the street. When the end-of-terrace property was built in 1902, coal was plentiful and the house used to lose heat by the scuttle-load. But after this exemplar home was insulated last year with modern materials its energy use fell by 84%. The home also has a plethora of energy-saving gadgets that its owner—the local authority, Waltham Forest Borough Council—hopes will help demonstrate how to fix the rest of the country’s housing stock.
Cold comfort
Share of homes in England, 2021, %
by type and year of construction
Energy-efficiency score (100=best) ↓
0
5
10
15
Semi-
detached*
Pre-1945
59
1945–90
65
1991+
73
62
Terraced
Pre-1945
68
1945–90
74
1991+
52
Detached
Pre-1945
65
1945–90
72
1991+
Bungalow
Pre-1945
55
62
1945–90
66
1991+
Flat
Pre-1945
63
1945–90
69
75
1991+
Sources: English Housing Survey,
DLUHC; The Economist
*includes end-of-terrace houses
Britain’s homes are among the oldest and least efficient in Europe. After the cost of domestic energy tripled this year in the wake of Russia’s invasion of Ukraine, the government introduced a price cap for households that limits the average bill to no more than £3,000 ($3,600) a year until April 2024. This short-term fix to prices will cost the state about £40bn and, in part because the government is now partially footing household bills, it will soon launch a campaign advising how homes can save energy.
But behaviour changes only get you so far. If people are to cut their energy use and benefit from lower bills in the long term, they will have to improve the energy efficiency of their homes. According to the latest government assessment, around 13m of England’s 25m residential properties need to be improved to meet the government’s 2035 energy-efficiency target, at an average cost of around £10,000 each.
Much more can be done, however. Because Britain’s housing stock is heterogeneous, there is no one-size-fits-all solution for retrofitting homes (see chart). But there are five significant renovations that nearly all householders can make.
Take a typical semi-detached three-bedroom house with a floor space of around 100 square metres (1,076 square feet) built in around 1900. (Semi-detached homes built before 1945 represent about one-in-seven of the country’s total housing stock.) Assuming it has not yet been modernised, it might have energy consumption of around 22MWh each year, which would cost about £4,000 at today’s prices.
A quarter of an uninsulated building’s heat is lost through its loft space according to the Energy Saving Trust (EST), a quango. The government recommends a minimum of 270mm (10.6 inches) of polystyrene or mineral wool insulation in lofts, but according to the latest data one in 30 lofts in England doesn’t have any, and half don’t have enough. Installing loft insulation in a semi-detached home costs about £650 but saves about £350 in bills each year at current prices, according to the EST. Topping-up from 120mm to 270mm pays for itself in around 12 years, well within the product’s 40-year lifespan.
Further improving thermal efficiency means fixing walls. As this house has solid walls there are two methods: cladding the outside or insulating the inside. Waltham Forest council wanted to retain the brick facade of 47 Greenleaf Road, so the front wall was insulated from the inside with 60mm of specialist insulation and then covered with plasterboard. The rest of the house was clad in an insulating blanket of 90mm of mineral wool which was then rendered and finished with a weatherproof top-coat. The Climate Change Committee, an independent body, reckons that similar insulation can reduce heating demand by 15-18%.
Such solid-wall insulation is disruptive to install and prohibitively expensive. Costs for insulating the walls of a semi-detached home vary from £8,500 to £12,000, and would save about £550 of energy a year in today’s prices according to the EST. That suggests a pay back period of 12-16 years. But around 65% of British homes have a vacant cavity-wall construction; insulation for a semi-detached home of this type costs about £1,200. About 20% of homes could still benefit from this simple fix, which would save households around £400 a year from current energy bills and pay for itself in three years.
When Angela Merkel, a former German chancellor, was asked what she thought of when she heard the word “Germany” she replied: “Pretty, airtight windows.” By contrast nearly 15% of Britain’s homes still lack fully double-glazed windows even though around 10% of a building’s heat is lost through single-glazed ones (depending on their size and number). Part of the reason is cost: the EST estimates that installing decent double glazing in a semi-detached home would cost £7,500 but saves only £235 of energy each year, taking nearly 25 years to pay back. For that reason households have tended to replace window frames only when they are beyond repair.
Although the government is focused on a “fabric-first” approach to housing, after the easy-to-treat insulation is done, it must also replace the millions of gas-fired central heating and hot-water systems with low-carbon alternatives. Although a number of different solutions exist—from hydrogen power to heat networks (biomass-fuelled generators that provide heat and energy to several hundred homes at once)—the most common replacement is likely to be air-source heat pumps.
Heat pumps work like an inverted fridge: rapidly compressing cold air from outside produces heat which is used to warm water. Although the government has set a target of installing 600,000 each year by 2028, just 55,000 were installed in 2021. The EST estimates installation costs of £7,000-13,000, versus around £4,000 for a new natural-gas boiler. Unlike insulation, heat pumps do not pay for themselves in energy savings. The government hopes that heat pumps will reach price parity with gas boilers by 2030, and it intends to ban the sale of natural-gas systems by 2035.
Microgeneration of electricity is likely to become one answer to high energy prices. Last year such small-scale installations accounted for 3% of electricity generated in Britain, mostly from photo-voltaic (PV) solar panels. Today around 800,000 homes have PV panels which, when combined with hot-water tanks and batteries to store the energy, are an important part of the government’s energy strategy. The EST estimates a solar array able to generate a maximum of 3.5kW would cost around £5,500. With the benefit of the “smart-export guarantee”, which currently pays around 5p for each kWh of power sent to the grid, PVs pay for themselves in 7-12 years.
Taken together, these five fixes would cost a princely £34,000. However, a back-of-the-envelope calculation suggests that the energy use of our home would fall approximately 35% from 22MWh to 14MWh each year. At today’s eye-watering energy prices that would save about £1,250 a year, paying for itself in 15-25 years, depending on the outlook for energy prices. The “deep retrofit” at 47 Greenleaf Road—which included a number of other solutions such as ventilation systems and heat exchangers—cost a cool £67,000.
Bundle up
Costs and savings of retrofit in our exemplar
three-bed semi-detached home, £’000
Annual savings, £
0
5
10
15
20
At cap*
No cap
Loft insulation
410
510
Solid wall insulation
330
410
Double glazing
130
160
Heat pump
nil
nil
Solar panels
440
650
Total
1,310
1,740
*Energy price guarantee will cap annual bill at around £3,000
Sources: Climate Change Committee; Energy Savings Trust;
The Economist estimates
Even when properties are improved there may be a large gap between the theoretical performance of insulation and its real-life efficiency gains. The behaviour of occupants matters as much for energy saving as any thermal material: some people may respond to their warmer homes by turning the heating up. That is partly why the deployment of smart meters—which provide timely readings of energy consumption and spending for use by households, suppliers and governments—needs to rise from half the country today to all of it by 2025.
The government is now hoping it can jump-start an insulation drive. On November 28th it announced a £1bn fund for insulation grants for middle-income households. The money will primarily target easy inexpensive tasks such as cavity walls and loft insulation. It brings total funding through to 2025 via a confusing alphabet soup of initiatives—primarily aimed at low-income households in especially draughty homes—to £7.6bn. Another £6bn has been earmarked for 2025-28.
With some support in place, the next challenge for the government will be providing adequate information and advice to households on how much to spend on what. It has so far failed to keep its promise of a retrofit advice service and some are calling for it to help set standards, too. Without that, many home-owners may find themselves paying for work that will provide them with little comfort in the depths of winter. ■ Correction (December 1st 2022): an earlier version of this article stated that microgeneration earned 5p for each KWh of electricity generated. In fact it is only paid when it is sent back to the grid. Apologies.
Illustrations: Manuel Bortoletti
More from Britain
How to fix 30m draughty homes
And help Britain reach net-zero emissions
Britain gets serious about sealing up its draughty homes
Insulation is part of the solution to the energy crisis
Britain’s social-care sector is in even worse shape than its health service
That is awful for the old and the vulnerable