Despite bill drop, go slow on making homes warm costing bill payers £3.2billion
ECIU analysis finds that a lack of progress on insulting Britain’s homes is costing energy bill payers £3.2 billion a year under the new price cap.
By George Smeeton
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Despite Ofgem announcing a slight fall in energy prices on Thursday, new analysis from the Energy and Climate Intelligence Unit (ECIU) has found that a lack of progress on insulting Britain’s homes is costing energy bill payers £3.2 billion a year under the new price cap. [1]
If the rate of insulating homes hadn’t fallen over the past decade, an additional 11 million homes could have benefitted from energy efficiency improvements by now. The UK has some of the least energy efficient homes in Europe which is one of the key reasons why British households have been hit so badly with high bills during the gas crisis.
Commenting on the analysis Dr Simon Cran-McGreehin, Head of Analysis at ECIU, said: “Millions of British bill payers are still counting the cost of inaction and low investment in insulating homes over the past decade. Renters are in a particularly difficult situation given they don’t have any control over improving the warmth of their homes. Bills may have dropped slightly, but they are due to rise again ahead of winter when having a properly insulated home is the difference between affordable and astronomical energy bills.
“The UK has been particularly badly hit by the crisis because we’re so dependent on gas for electricity and home heating. Shifting to net zero means building more British renewables and insulating more homes and so becoming less dependent on foreign gas imports.”
Upgrading a typical home (EPC D) to reach the government's own target (EPC C) would have saved the household over £200 a year under the new prices. For the 4.4million homes that have even worse energy efficiency, the savings would have been almost £400 for EPC E and £550 for EPC F.
The government last year cancelled plans for private landlords to upgrade their properties, which have worse than average energy efficiency. Upgrading these homes would save those households £1.4bn a year under the new prices.
Previous ECIU analysis has found that the UK spent £100bn on wholesale gas in the first 2.5years of the gas crisis, an additional £75bn compared to an equivalent duration beforehand [2]. This translates to hundreds of pounds for bill payers and also tax payers who subsidised bills.
ENDS
Notes to editors:
1. Analysis of savings per home is based on: unit rates from Ofgem's price cap for Q3 2024; and median annual consumption values by EPC band for gas and electricity from the government's English Housing Survey. Numbers of homes at each EPC band are estimated based on the English Housing Survey. Where necessary, as a first approximation, data for England is scaled to the UK. Estimates of the number of homes that could have been upgraded are as per discussion in the report The Cost of Not Zero 2023 (ECIU, 2024).
For more information or for interview requests:
George Smeeton, Head of Communications, ECIU, Tel: +44 (0)7894 571 153, email: george.smeeton@eciu.net