Energy inefficient homes face £1,730 bills rise

Energy Price Cap Insulation Crisis Heating Bills Winter
Energy Price Cap Insulation Crisis Heating Bills Winter

Two thirds of homes in England and Wales face significantly higher energy bills because they are poorly insulated, new research has shown.

Properties with an Energy Performance Certificate of D or below face an average bill increase of £1,730 a year when the energy price cap rise comes into effect in October, according to analysis by Kingfisher, the owner of B&Q, and the Centre for Economic and Business Research, an economics consultancy.

This compares to an increase of £982 a year for the homes that meet the Government’s target energy efficiency rating of C or above – a stark £748 gap.

Kingfisher said this would hit households in Wales, Yorkshire and the Humber, and the West Midlands the hardest when energy regulator Ofgem raises the price cap.

Most of Britain’s energy-efficient housing is confined to London, the research found, posing a challenge for the Government’s levelling-up agenda.

On Friday, the regulator announced the price cap, which limits the amount customers can be charged on a standard variable tariff, would rise by 80pc, from £1,971 to £3,459. This includes an 84pc jump in the unit rate for electricity and a 104pc rise for gas.

Cornwall Insight, an analyst, predicted the cap will rise by a further 50pc in January – to £5,387 – and again to £6,616 in April 2023.

The upcoming cap increase has spurred homeowners to look into making their homes more efficient. A survey by Kingfisher found that 60pc of respondents were more interested in energy efficiency than they had been previously due to recent rising bills.

Only 34pc of those surveyed planned to make green improvements, however. A third of respondents cited high upfront costs as a barrier to energy efficiency, while 27pc said it was too much work.

Rented properties are on average more energy efficient than owner-occupied homes, the research found. But the survey found that a majority of renters – 72pc – wanted their landlords to do more to improve the energy efficiency of their properties. Only one in five said their landlords had made improvements in the past year.

Thierry Garnier, of Kingfisher, said: “The UK’s housing stock is among the least energy efficient in Europe, with UK homes losing heat up to three times faster than European neighbours.

“With a nearly £750 gap between the bills in the most and least energy efficient homes, and with homes responsible for around 20pc of the UK’s emissions, tackling this challenge has never been more important.”