by Ian Babelon
How can social housing retrofits help tackle the cost-of-living and climate crises that are currently exercising the minds of landlords, householders, tenants and governments? In this, blog post, Ian Babelon looks at the potential of retrofits for making homes more energy efficient and for futureproofing the built environment.
The benefits and costs of retrofitting
Around 38% of all homes in the UK were built before 1946. As a result, the UK’s housing stock is not only the oldest, but among the most poorly insulated in Europe, leading to higher energy bills and a lower quality of life. At the same time, UK homes account for over 66m tonnes of direct carbon emissions, undermining government decarbonisation efforts.
On many different levels, making Britain’s housing more energy efficient makes sense. Estimates by the UK’s Department for Energy Security and Net Zero (DESNZ) suggest households could save £220-400 in energy bills per year. In addition, retrofitting homes can address fuel poverty, provide decent homes, reduce public health costs, and help deliver decarbonisation targets.
But energy efficiency requires investment. Insight shared by the Greener Futures Partnership shows that it could cost between £13,000 and £25,000 to bring a social home to EPC (energy performance certificate) band C. This does not take into account training and skills requirements to retrofit homes, nor the significant variations in property condition, fabric type, fluctuating costs of construction materials, retrofit design choices, scheduling of renovation works, and availability of construction labour with the right skills. Retrofitting social homes at scale therefore requires working on multiple fronts at the same time.
The cost of not retrofitting
The 2022 Cost of Living Crisis in Scotland report by the Scottish Government shows that as many as 35% of households in Scotland may be fuel poor. In England, figures for 2022 by DENSZ indicate that fuel poverty affects 13.4% of households.
The consequences of fuel poverty are wide-ranging. The annual cost of treating health conditions associated with cold, damp homes in England amounts to £1.3 billion. Poor housing also affects mental health, can impair children’s learning opportunities, and puts older people at greater risk of strokes and other severe health conditions.
A 2021 National Housing Federation report showed that the UK’s social rented sector has made great progress in tackling fuel poverty (64.3% of housing association homes already have an EPC rating of C or above). But the study also underlined how much more needs to be done. An additional £36bn of investment is required, said the report, to bring the remaining 39% of housing association homes up to a C rating, as well as installing heat pumps and other clean heat technologies in all 2.7 million homes.
Financing challenges and solutions
Social landlords also face significant costs for remediation and building safety improvements that hamper their efforts to retrofit homes and meet national energy efficiency targets. As DESNZ rolls out the second wave of the Social Housing Decarbonisation Fund, the NHF has called for long-term funding certainty so retrofits can pick up the pace.
Fortunately, more financing opportunities are becoming available for social landlords looking to make their properties more energy efficient, as reported in a report by the Green Finance Institute. These include local climate bonds, leaseholder finance and insurance-backed ‘comfort plans’, such as the Energiesprong approach, which can pay for insulation measures with energy and maintenance savings.
Fabric first…
It pays to insulate homes before investing in complementary measures such as renewable energy generation or smart technologies. This ‘fabric-first’ approach is an attractive alternative to the large up-front investment costs for deep, ‘whole-house’ retrofits that may be prohibitive for social housing landlords.
Incremental retrofit approaches can combine initial fabric improvement with scheduled upgrades, such as replacing gas with energy-efficient electric heating and hot water, installing air-source heat pumps (ASHP) or introducing smart home devices.
Strategic planning is essential to avoid piecemeal interventions that might prove more costly and less effective over time. The Social Housing Retrofits for the Future report commissioned by the Greener Futures Partnership highlights the need for cross-sectoral collaboration to tackle technical, financial, legal and customer engagement requirements simultaneously by providing extensive evidence from across Europe and the UK.
LETI, a volunteer network of over 1,000 built environment professionals, has published a Climate Emergency Retrofit Guide for use by social housing landlords, designers and contractors. The guide provides an engaging infographic overview as well as guidance for a range of home archetypes.
… Or building from scratch
Are all poorly performing homes worth retrofitting? So-called ‘hard-to-treat’ and ‘hard-to-decarbonise’ homes (about 2% of all social homes) can be very costly to upgrade. LETI provides a decision aid to determine whether one should retrofit or build anew, to be used in conjunction with other guidance.
A key aspect of this decision is to differentiate between embodied carbon (carbon emitted in making construction materials and during actual construction) and operational carbon (emissions produced during occupancy). All things considered, it is usually more worthwhile to renovate and reuse homes than to knock them down and redevelop them.
Beyond retrofitting
As performance increases to meet sector-wide energy-efficiency targets, designing for and monitoring air tightness will become increasingly important to help achieve decarbonisation.
High-performance standards such as Passivhaus ENERPHit are premised on sound air tightness and ventilation to guarantee thermal comfort while reducing energy costs. The Passivhaus Trust provides resources and case studies to help councils, ALMOs and housing associations deliver energy-efficient retrofits and new builds, along with a recent evidence-based research report that makes the case for whole-house, low-carbon retrofits.
The next frontier for retrofitting social housing at scale lies in neighbourhood-wide retrofits that could appeal even more to green finance but would require commensurate public-private partnerships and coordination.
Final thoughts
Overall, retrofitting social housing is a win-win for everyone involved. It is good for the environment, the economy, and the people who live in social housing. The up-front costs can be substantial, but the long-term benefits should make these investments cost-effective.
The social housing sector has clearly been taking action to deliver more energy efficient homes, and it’s working with residents, contractors, local authorities and other stakeholders to ensure that the Social Housing Decarbonisation Fund succeeds.
Challenges remain, notably concerns about skills shortages. But the prize of warmer homes, affordable energy, a better quality of life and a cleaner planet is well worth the effort of overcoming these obstacles.
Ian Babelon, UX Researcher, Idox
A longer version of this article is available for subscribers to The Knowledge Exchange Information Service. To retrieve it from our online database, use the reference number: B67199.
Photo by Erik Mclean on Unsplash
Further reading: more on energy efficient housing from The Knowledge Exchange blog
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