Six million poorly insulated homes to face £320 ‘surcharge’ from April

Soaring energy bills will hit those living in poorly insulated homes the worst, according to new research highlighting the true cost of the government’s inaction towards insulating Britains’ homes and the worsening cost of living crisis. 

Families living in homes with an energy efficiency rating E or worse will face annual heating bills at least £320 higher than those living in C-rated homes from April, according to new research from the Resolution Foundation.

While homes with poor insulation have always been more expensive to heat, the scale of the difference is laid bare in the findings.

Four million homes have an E insulation rating, while 1.5 million families live in homes with an even worse rating of F, and will face a surcharge of £390.

The government’s green homes target will require landlords to insulate privately rented properties to a C-rating by 2028, but there is no plan for the two-thirds of households who are homeowners. 

In April, the energy price cap is expected to rise by around £700 at the same time as new taxes are levied and inflation is driving up the costs of everyday goods. 

The Bank of England has warned Brits to prepare for the steepest drop in living standards for 30 years as the cost of living crisis sets in from April. Interest is predicted to soar to 7.25 per cent, meaning the cost of everyday goods like groceries will rise even further while wages continue to stagnate.

“It is vital that the Government ramp up progress in insulating homes and reducing the costs of public charging points for electric vehicles so that the whole of society can benefit financially from a low carbon economy,” said Jonny Marshall, senior economist at the Resolution Foundation.

The key to delivering Britain’s net zero transition, will ultimately depend on “delivering the infrastructure around (low-carbon technologies) – such as better insulating Britain’s housing stock,” he continued. 

The new report, produced in collaboration with the LSE, funded by Nuffield Foundation, calls on the government to reverse “the previous decade of abject policy failure on home insulation.”

In a bid to tackle rising energy costs, the government is looking at scrapping a scheme that makes low-income homes more energy efficient, The Guardian recently reported.

The Energy Company Obligation (ECO) is a £1bn levy on energy bills which helps to pay for installation of energy efficiency measures in low-income households. Experts have warned, however, that removing the levy would save little money – about £29 on the average bill – and would ultimately leave poorer households paying the price.