The Chancellor can cut bills by helping to upgrade our leaky homes

David Ward, Policy & Public Affairs Advisor | ROCKWOOL UK

By all accounts we’re all due a shock this year as energy bills jump up to their highest levels for decades. They say an Englishman’s home is his castle – we may now be about to discover how much it costs to heat one.

Already more than three million households were behind on their payments in 2021.[1] The current price rises will push that number even higher, and even more will see their budgets stretched thin.

Of course the Chancellor can’t do anything about global gas prices when he gives his Budget, which could stay high into next year and beyond. But by reducing demand for energy, a serious and ambitious home insulation programme would create a lasting solution to bringing down household energy demand and skyrocketing bills.

Households could save on average £500 a year on their bills by getting their homes up to EPC C, and by raising the six out of ten homes in England below this level up to scratch, we could collectively save over £8bn, according to think tank E3G. These homes will need to be upgraded anyway if we’re going to get to net-zero by 2050.

We know people want to take action. In a recent survey by One Poll commissioned by ROCKWOOL, 87% said they would be more likely to make their home more energy efficient if they had financial support and other resources they needed. This is up from 84% when we asked people the same question last September.

We also know people are already expecting to feel the pinch from energy price rises. Almost a third (29%) of households admitted they will have to cut back on essentials such as accommodation and food costs to afford rising energy bills.

Whilst owner-occupiers are often termed ‘able-to-pay’ in the government’s language, many pensioners for example might own their house outright but won’t have the cash upfront for renovation work. In One Poll’s survey, 54% of all respondents said cost was a barrier, while 57% said they did not feel knowledgeable about how to apply for funding support, source advice on what to do or find qualified workers.

Government has made a start. Funding has been allocated to the Home Upgrade Grant scheme for low income households and to the Social Housing Decarbonisation Scheme. And of course there are plans to install 600,000 heat pumps each year by 2028. But heat pumps work best when the radiators can run at low temperatures. Without insulating the buildings first, we’ll still be paying for heat that goes straight out of the walls.

It doesn’t have to be this way and we don’t need to invent new technology to make a difference. Take Wilmcote House, a 1970s social housing block in Portsmouth. Heating there was so poor one resident said: “We go to bed and I’ve got the socks on, pyjamas on, dressing gown on…and it’s still so cold!”. After a retrofit by Portsmouth City Council, using ROCKWOOL insulation, not only were flats warmer and more comfortable, a study by the London School of Economics found residents’ energy bills went down by an average of £700 a year.

There are three immediate steps we could take to drive results like this nationwide.

First, Government could move forward with the final £2bn promised to the Homes Upgrade Grant, Social Housing Decarbonisation Scheme and Public Sector Decarbonisation Fund and set out clear delivery plans for industry and households to engage with.

Second, the Chancellor could set up a new nationwide retrofit scheme for other households who need some extra financial support to take action. At present two thirds of households have no access to support for making their home more energy efficient.

Third, we need a clear and comprehensive roadmap from government showing how and when retrofit schemes will be made available over the next decade. That clarity will enable households to plan as well as allowing manufacturers and the construction industry to invest in skills and capacity.

These price rises will be tough for everyone. If the Treasury doesn’t act now to reduce our energy demand by the end of this year or the next, we’ll be back in the same position - with less money. On the other hand, if we invest in fixing our homes now, we’ll be well prepared for the future.

David Ward is Policy & Public Affairs Advisor at ROCKWOOL UK.

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