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Action needed to get low-carbon housing plan back on track to meet green targets and keep bills down


The UK needs millions more energy efficient homes to help cut bills and carbon emissions, although much more needs to be done at pace to get on track with meeting the UK Government’s key target,  according to new research published today (Monday, 26th June).

  • Residential properties account for 16% of the UK’s carbon emissions
  • 6 million homes should be insulated by 2030 to meet UK Government target to reduce energy consumption by 15% with existing policies expected to deliver around 1 million
  • More support is needed to encourage uptake of low-carbon solutions like heat pumps, particularly for lower income households, to pick up the pace and fill the gap

A study for WWF UK and ScottishPower, the first major UK energy company to generate 100% renewable electricity, found a substantial gap emerging between what is on course to be delivered and what is needed to reach the UK Government’s desired energy reduction target of 15% by the end of the decade.

The report carried out by Frontier Economics shows that the UK Government needs to significantly step up its plans to accelerate the delivery of energy efficiency measures in homes, such as better insulation or replacing fossil fuel boilers with electric heat pumps, to get on track with meeting its ambition.

Currently 6 million homes need to be better insulated by 2030 to meet the UK Government’s target, however, existing policies are expected to deliver around 1.1million. As well as better insulation, it is estimated that 1.5 million homes will still need heat pumps installed and a further 600,000 homes will need connection to low-carbon heat networks.

The study from Frontier Economics follows earlier research commissioned by WWF and ScottishPower that has been recently updated with Ofgem’s latest energy price cap. It finds that homes equipped with a range of low carbon technologies, including solar panels, EV chargers and the right energy efficiency measures, could currently save a typical household up to £2,300 on their energy bills each year, compared to homes without.

Making low carbon improvements could also increase the long-term value of a home by up to £10,000, while also helping to reduce its carbon emissions.

Isabella O’Dowd, Head of Climate Policy at WWF said: “We know insulating homes protects consumers from high energy bills and we can’t wait until winter - summer is the time to fix the roof. With our homes accounting for 16% of the UK’s carbon emissions, the UK Government must act now and tell us how it will insulate the extra 5 million homes it needs to keep us on track to meet its green ambitions and drive down bills.

“Insulating millions more homes is vital for the Government to meet its energy efficiency target and could benefit households to the tune of hundreds of pounds every year.”

Robert McGaughey, Head of Smart Heat at ScottishPower, said: “We were pleased when the UK Government set a new target for reducing energy consumption from homes by 15% by the end of the decade – and this report from Frontier Economics highlights the scale of the task ahead.

“It shows that delivery needs speeding up and support scaling up – planned polices need to come off the drawing board and be actioned, and some new policies are needed too. Accelerating action now to achieve this target will help more households to reduce their heating bills sooner.

“In all of this, there needs to be a strong focus on delivering a whole house approach to those on low incomes, combining insulation improvements with greener heating options such as efficient heat pumps. There is no time to waste in filling the gap – and ScottishPower is ready to play its part.”

The UK Government recognised the importance of energy efficiency measures in last year’s Autumn Statement by setting a new target to reduce energy demand by 15 % by the end of the decade.

This latest research on energy efficiency from Frontier Economics compared the deployment of energy efficiency measures (including heat pumps) required to meet the 15% target (measured against 2021 levels), to expected deployment through existing and planned Government policies.

As well as assessing what’s needed to meet the 15% target, the research also considered a 20% stretch target. This target is likely to be closer to the reduction needed in 2030 on the way to meeting the Net Zero challenge under the Climate Change Committee’s Net Zero Balanced Pathway.

The Frontier Economics report makes it clear that reaching the 15% target in the next seven years would need to see the additional delivery of 5 million households receiving fabric efficiency (insulation) retrofits, 1.5 million heat pumps installed and a further 600,000 existing homes connected to low carbon heat networks like district heating systems.

If the UK aimed for the more ambitious target of a 20% reduction in consumption by 2030, with all committed and planned policies accounted for, an additional 5.4 million homes would require fabric efficiency retrofits, an additional 1.4 million homes would require heat pumps and a further 1.4 million homes would require connecting to a heat network.

View the Filling the Gap report - Frontier Economics Analysis

View the Filling the Gap report - Summary