The UK’s housing stock is the oldest in Europe.¹ It accounts for 15% of the UK’s carbon emissions,² and with c. 60% of British homes having an Energy Performance Certificate (EPC) rating of below C,³ the UK Government needs to take urgent steps to improve home energy efficiency and support homeowners to meet its 2035 target of an 81% reduction in carbon emissions.⁴
Upgrading the UK housing stock involves the successful delivery of a widescale home upgrade plan which requires leadership and a clear roadmap from Government. Barclays’ new report, Electrifying the future: boosting the energy efficiency of UK homes, explores the barriers delaying progress and outlines five strategic recommendations to help address them.
The Government has an opportunity to course-correct and accelerate progress to decarbonise British homes at pace, but a coordinated effort across industries is required to address the key challenges and barriers we see today.
Barriers
Barclays perceives the main challenges as structural and behavioural.
Five strategic recommendations
Barclays’ recommendations detail how Government action can drive real impact, and facilitate a holistic approach that can effectively engage key industry players, drive action, and motivate consumers, and meaningfully move the dial in terms of home energy efficiency efforts.
Roadmap
Delivery of the Government’s target for heat-pump adoption and improved efficiency demands a detailed, time-bound plan with milestones and an investment timeline. This should also clarify the role for tax breaks and incentives, as part of the agreed public financing envelope in addition to increased availability of private financing options.
Collaboration
To facilitate systematic action, Government should convene a Retrofitting Delivery Authority to address the implementation challenges of retrofitting, allowing the public and private sector to work together strategically.
Data
To help consumers and businesses commit to adopting energy efficiency measures, including installing heat-pumps, the Government should complete EPC reform including methodology updates to capture smart meter data as well as steps to increase their utility.
Safety
Government should incentivise a consistent consumer protection standard for key energy efficiency installations to reduce installation risks for consumers and increase uptake.
Education
To build homeowner support for greater energy efficiency, Government should commit to a bold, systematic public engagement approach that tackles the lack of awareness and builds support for home retrofitting by promoting the consumer benefits of energy efficiency.
Barriers to home retrofitting
Barclays’ research⁵ found that consumers find the topic of retrofitting their homes complex and expensive. While 70% of homeowners surveyed would like their home to be more energy efficient, more than one-in-three (35%) are dissuaded from making the improvements because they do not understand which options are right for their property⁶. There are a breadth of reasons which prevent homeowners from making improvements to their homes, the top ones being perceived expense and lack of confidence in the end results.
When asked who should be taking action to change how homeowners heat or cool their homes, more than two-thirds (67%) said it should be the Government.⁵
Learning from history
History has shown the impact of successful efforts to engage and motivate the public when led by the Government, for example with the energy switch in the 1970s, when the UK transformed the nature and origins of its gas supply.
A number of parallels can be drawn with the challenges the Government faced at the time. The energy transformation required a complete overhaul of the UK’s gas production and delivery network and of all gas-using household appliances. After the election in 1964, Harold Wilson’s Government was keen to embrace scientific and technological innovation, but faced significant fiscal challenges, including a substantial trade deficit.⁷ Despite these limits, the switch was delivered under budget and on schedule – and its success positioned the country as a world leader in the field.⁷ The Government played a critical role with clear policy and communications, including a sustained national public engagement campaign, as well as providing a centralised decision-making process around conversion which drove wider change across the country.⁷
In today’s landscape, a coordinated system, clear policy, and creative thinking is required to implement a nationwide movement that will result in substantial changes to housing energy efficiency.
The Government must take action now and act as the central source of strategy across industries to accelerate progress towards more energy efficient homes.
Footnotes:
- Adam Corlett & Lindsay Judge. The Resolution Foundation Housing Outlook. 2024
- Climate Change Committee. 2022 Progress Report to Parliament. 2022
- UK Finance. Net Zero homes: Time for a reset. 2022
- UK Government. UK shows international leadership in tackling climate crisis. 2024
- Barclays. Ipsos. Retrofitting and Net Zero: A behaviour change dilemma. 2023
- Barclays used Opinium to survey a nationally representative sample of 1,229 UK adults aged 18+ between 16 and 20 February 2024. Barclays. Barclays extends partnership with British Gas to offer half price home energy efficiency checks. 2024
- Dr Christopher Prior and Dr Charlotte Riley. University of Southampton. A revolution in the UK’s energy supply: From ‘town gas’ to natural gas