Lack of action on leaky homes will cost taxpayers billions – new LGA analysis

Slow progress in insulating homes will cost Government at least £4.2 billion in energy waste over the next two years, councils warn today.

New analysis from the Local Government Association, which represents more than 350 councils across England and Wales, projects poorly insulated homes will be leaking £12.7 billion of energy over two years, with a third of that cost being incurred by the Government under its recently announced Energy Price Guarantee.
Homes with an EPC D rating or lower will have an average of £488 of heat per year escaping out of poorly insulated doors, windows, roofs and walls.

While families in inefficient homes will lose a total of £8.6 billion in energy waste over the two year scheme, the costs incurred by Government under the intervention could increase if energy prices rise as projected next year.
The most wasteful homes in England are older and more likely to be occupied by older people and those on lower incomes, with over 60 per cent over 65s living in England’s least energy efficient homes. 
Owner occupied and private rented homes are almost twice as likely to be rated EPC D or below than social homes. 
Councils are best placed to deliver programmes to help decarbonise England’s buildings, generate skills and jobs, and promote and protect public health. 
They have the local knowledge, experience, trusted status, relationships with residents and the ability to forge local partnerships, and deliver with precision and pace.
The LGA is therefore calling for the Government to renew its partnership with councils to redouble urgent efforts to better draught proof, insulate and retrofit all homes and accelerate the shift to renewable energy, as well as give residents energy saving advice.
This action won’t just benefit the household and public purse in the short term, it will mean long term savings on energy costs and a decrease in carbon emissions. 
It will help protect more vulnerable people from suffering cold and damp conditions that could lead to a health crisis for the NHS.
Cllr David Renard, environment spokesperson for the LGA, said: 
“Retrofitting more homes is a practical, sustainable and economically responsible solution to keep many people warmer and safer through winters.
“Investment now will save households and taxpayers money further down the line, ease the cost-of-living crisis, reduce health crisis for people in cold and damp homes, and mean families have added security and flexibility within their budgets. 
“Alongside a transition to renewable energy, a retrofit renaissance could be the centrepiece of renewed efforts to drive economic growth, create more jobs and increase productivity, and deliver net zero to protect our environment now and for the future.
“Councils are eager to help the Government deliver on this win-win-win agenda as fast as possible.”

Note to editors

Cost incurred by energy wasted from the 13 million dwellings that are EPC D or below under the Energy Price Guarantee (EPG)


1 year (October 2022–October 2023) – Average per dwelling

1 year (October 2022–October 2023) – All dwellings

2 years (October 2022–October 2024) – Average per dwelling

2 years (October 2022–October 2024) – All dwellings

Households – energy waste under EPG unit rates £328 £4.27 billion £656 £8.55 billion
Government – energy waste from meeting the cost difference between EPG unit rates and Ofgem Q4 2022 cap on unit rates* £160 £2.08 billion £320 £4.16 billion
Total cost of energy waste for households and Government £488 £6.36 billion £976 £12.71 billion


* Waste for Government will vary with energy costs over the time of the Energy Price Guarantee. Latest projections are for energy costs to rise over 2023, but these are not included in the estimates on energy waste.