“Our new research focuses on the key barriers to decarbonisation, the incentives needed to drive progress and contains insight from people who have retrofitted their homes."

Dr Rebecca Heaton
Director of Environmental Sustainability
23 November 2023
3 min read

At the time of writing, the UK’s 28 million residential and two million non-residential buildings account for 17% of total carbon emissions. The UK has the oldest and draughtiest housing stock in Europe – upgrading it will be a major factor in whether we reach net zero carbon emissions by 2050.  

Significantly, this issue is high on the agenda at this year’s Conference of the Parties (COP 28), where climate experts and world leaders will gather to reveal the results of the world’s first global stocktake and assess progress towards the Paris Agreement.

In preparation for this, and with the help of WPI Economic and Censuswide, we have produced a report: Decarbonising the UK’s Homes: A Housing Stocktake which deals specifically with UK housing stock and provides a thorough look at the current state of decarbonisation across UK homes and residential properties. The research also identifies the main barriers to decarbonisation and, importantly, contains knowledge gleaned from homeowners and landlords who have gone through the process already.


Decarbonising the UK’s Homes: A Housing Stocktake, 2023

Read full our report (PDF, 4MB)

Where are we currently?

As part of the research, WPI Economic and Censuswide polled 2001 respondents and gathered insights from 252 property managers. 

Ultimately, we found that despite Britons showing eagerness to decarbonise their homes, progress has nonetheless slowed in recent years. In fact, the total number of energy efficiency measures installed through government schemes fell notably from 2021 (453,000) to 2022 (204,000) according to figures from the Department of Energy Security and Net Zero,1  and despite the UK Government’s proposal to scale-up the market for heat pumps to around 600,000 by 2028, rates are currently just 11% of this figure.2

Moreover, statistics from the UK Climate Committee also show that the UK came last out of 21 of neighbouring countries for per capita installations of heat pumps in 2022, and 11th out of 21 for total volume installations.3 Put simply, we’re moving too slowly, and will need to seriously ramp-up efforts to deliver the substantial change we need over the coming months and years ahead.



What do we mean by 'net zero ready?'

The term ‘net zero ready’, as defined in the bespoke research carried out by WPI Economics and Censuswide in October 2023 for our report, refers to a property with “EPC C with insulation, double glazing and heating from a low carbon source”.


What’s stalling progress?

Despite both landlords and homeowners having the desire to make their homes greener (57% of homeowners and 67% of landlords said they think it’s important to take steps towards making their property ready by 2035) just over half surveyed knew their EPC rating. And only 28% said they’d know what to do to make their property net zero ready  for 2035. In addition, most homeowners and landlords say don’t have the necessary cash to make their property net zero by 2035 right now either. 

It’s clear, then, that cost and knowledge are significant barriers in the way of people decarbonising their homes. But alongside financial incentives and improved education, homeowners, landlords and the market also need policy certainty.

The Government’s announcement that it will not continue with its plans for higher energy efficiency standards for rental properties resulted in landlords cancelling plans to invest in energy efficiency measures. And over half said they were unlikely to make such investments in the future. 

Our research shows the powerful catalytic effect policy certainty and legislation can have on driving uptake of retrofit when delivered effectively. If we look at the example existing UK government legislation has had on UK landlords, 84% said they have considered or actually taken action to improve energy efficient over the last five years. In turn, this led to additional retrofit action and saw landlords outperformed homeowners on the implementation of additional energy efficiency improvements such as solar panels, triple glazing, heat pumps and battery storage.


"If we look at the example existing UK Government legislation has had on UK landlords, 84% said they have considered or actually taken action to improve energy efficiency over the last five years."


Who is responsible for getting the UK ‘net zero’ ready?

Almost 68% of homeowners and 87% of landlords want support from their bank. But many believe that both governments and banks aren’t currently doing enough to support the transition.

Now, more than ever, it’s vital that financial institutions and businesses work with the UK Government to establish a comprehensive plan going forward. Our own five key policy asks include a long-term framework that provides certainty around sustainable home initiatives, calls for improvements on Energy Performance Certificates (EPCs), a system of stamp duty that rewards green home improvements, removing tax barriers for employers and the use of employer tax incentives to encourage green improvements.

Looking ahead

At the time of writing, we’ve provided over 2,000 customers with cashback for approved energy improvement initiatives through our Halifax Green Living Reward and Lloyds Bank Eco Home Reward.4

And as I say, as part of our recent Making Homes Greener initiative, we’re calling on the UK Government to deliver a clear, five-point plan to help make the UK’s homes more energy efficient. Yet despite the progress we’ve already made in supporting our customers to boost the energy efficiency of their homes, we know that now is not the time for complacency.

Our research shows that there’s significant room for improvement, but there’s also reasons to be optimistic. There’s still time to reduce carbon emissions and help our customers make their homes warmer and cheaper, but it will require collective action and collaboration from policymakers, energy companies, house builders, landlords, and banks to tackle the challenges ahead.  


Dr Rebecca Heaton
About the author Dr Rebecca Heaton

Director of Environmental Sustainability, Lloyds Banking Group

Dr Rebecca Heaton has a 25-year global career working at the interface between business, science, and policy. Her expertise spans energy, climate change and land-use and the role business must play in enabling the UK to decarbonise. After an early career in academia, she has held senior roles in a number of large energy companies and is currently the Director of Environmental Sustainability for Lloyds Banking Group.  

She was a member of the UK Committee on Climate on Change from 2017 to 2021, and currently sits on the Natural Environment Research Council. She is a Fellow of the Institute of Chartered Foresters, has a PhD on climate change, energy and forestry from Cardiff University and was awarded an honorary Docter of Law from Bangor university for her work on climate change policy. In 2021 she was selected as one of ‘one hundred women to watch in business’ by Cranfield University.

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